Next question: Who exactly will get hit from the big move?
John Hodulik, media analyst for UBS, expects advertising revenues will grow slowly at Netflix -- with ad revenues for the U.S. and Canada expected to hit $2 billion in 2025.
Hodulik did not reveal more specific details about where exactly those ad revenues would come from. But we can assume persistent general erosion of national TV platforms -- live, linear TV platforms in particular -- will mean cable TV networks are likely to get hit.
At the same time, Disney+ is also starting up its ad-supported service, is likely to be competitive as well. And you might again wondering how much self-erosion will be at its live, linear TV networks -- broadcast and cable.
We already see where dollars are moving from -- and to -- streamers. NBCUniversal's Peacock noted earlier this year it pulled in $1 billion in upfront advertising revenue commitments. How much of this was intended for the NBCUniversal-owned TV networks?
Drill down into this. We know that Netflix, for example, currently has very limited ad avails for marketers to buy -- on a limited number of TV series and movies. On the other side, Peacock and Paramount+ hourly ad loads are currently more comparable to on linear TV network schedules.
These streaming platforms are likely to cause quicker erosion -- including some of parent owned live linear TV networks.
In two years, UBS estimates for Netflix at $2 billion would roughly result in a national TV share of 5% -- assuming around $40 billion in advertising spend on national TV (linear and streaming) per year currently.
Hodulik estimates advertising revenue from Netflix ad-supported subscribers will yield an average revenue per user of around $3 initially. Still overall advertising revenues will result -- at least initially -- on Netflix's overall revenue.
For the second quarter of this year, the top five network-based media owners -- in terms of overall market share -- went this way: Warner Bros. Discovery (21%), Walt Disney (19%), Comcast Corp. (18%), Paramount Global (16%), and Fox Corp. (5%).
So figured from this list -- again roughly -- where new streaming platforms will tap into eroding live linear TV services.
Tracking exact advertising-revenue movements into Netflix will be harder.