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WSJ News Exclusive | Comcast’s NBCUniversal, Google Among Front-Runners to Partner With Netflix to Help Create Ad-Supported Tier

Comcast Corp’s NBCUniversal and

Alphabet Inc.’s

GOOG 1.28%

Google have emerged as top contenders to partner with

Netflix Inc.

NFLX 6.15%

and help the streaming giant create an advertising-supported tier of its service, according to people familiar with the matter.

Netflix, which is hoping to boost revenue by selling ads around its programming, is still in the early stages of developing the strategy and has explored a range of tie-ups in recent weeks.

A partnership with NBCUniversal would likely be exclusive, the people familiar with the matter said. Comcast’s video ad unit, FreeWheel, would supply technology to help serve up ads, while NBCUniversal’s ad sales team would help sell ads in the U.S. and Europe, the people said.

A partnership with NBCUniversal would likely involve revenue-sharing, and one issue might be whether Netflix will be guaranteed a certain amount of revenue, they said.

Linda Yaccarino,

chairman of global advertising and partnerships for NBCUniversal, would be a major player in such a partnership.

Google brings to the table its own ad serving technology and experience in video through YouTube and its online channel bundle, YouTube TV, people close to the discussions said. Google already has a commercial relationship with Netflix, which is a major customer of its ad-buying tools, they said. It is likely Google would also pursue an exclusive arrangement.

“We are still in the early days of deciding how to launch a lower priced, ad supported option and no decisions have been made,” a Netflix representative said.

Roku Inc.

ROKU 4.83%

has also had early talks with Netflix about ad partnerships, the people familiar with the matter said. The Information previously reported that Netflix talked to Comcast and Roku about getting help on technical infrastructure or ad sales.

Netflix’s subscriber count fell for the first time in nearly a decade, causing its stock to post its worst one-day percentage decline since 2004. WSJ’s Joe Flint walks us through three strategies the company might try to continue growing, and what the changes could mean for other streamers. CORRECTION: An earlier version of this caption said Netflix’s stock plummeted to its lowest point since 2004.

Write to Sarah Krouse at [email protected], Patience Haggin at [email protected] and Lillian Rizzo at [email protected]

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