Around 1.5 million people in the U.S. have signed up to pay for Netflix’s tier of service that carries ads, the streaming service has told advertisers in the past two weeks, according to industry executives. That’s a tiny fraction of both Netflix’s total U.S. subscribers and the roughly 30 million subscribers who pay for Hulu’s ad-supported tier, demonstrating that Netflix isn’t yet a force in advertising.
Hulu’s ad-supported tier is 15 years old, however, while Netflix’s service was ad-free until last November, when it launched the ad-supported tier at $6.99 a month. Since that tier’s launch, Netflix ad executives have been cautious in describing its near-term outlook, although they remain optimistic about the long-term prospects. Netflix recently eliminated its lowest-priced ad-free tier costing $9.99 a month, which means the ad-supported tier now costs less than half the price of its cheapest ad-free tier. That could drive more people to the ad-supported tier.