Netflix's Nobody Wants This - NY Fan Screening

Everybody wants this? More than half of Netflix sign-ups were for ad-supported memberships last quarter. Adam Brody and Kristen Bell screen Netflix’s “Nobody Wants This” (Jamie McCarthy/Getty Images for Netflix)

Ad-ding up

More than half of new Netflix signups were for the cheaper advertising tier

In markets where ads are an option, over 50% of potential customers chose them. Now Netflix just has to figure out how to sell the ads.

Rani Molla

10/21/24 10:13AM

More than half of Netflix sign-ups were for its tier with advertising last quarter, a number that’s been steadily climbing since the company unveiled its less expensive ad-subsidized memberships at the end of 2022.

Growing interest in the ad tier, which costs $6.99 in the US compared to $15.49 for the cheapest ad-free tier, is good for Netflix’s two-part plan to have the ad tier become a primary revenue driver.

“Priority number one was we have to grow our ad-tier memberships so that we can get to a sufficient scale to be relevant in each market for advertisers,” co-CEO Greg Peters said on the company’s earnings call last week. “And the big priority number two is we have to improve our capabilities and attractiveness to advertisers and, therefore, the monetization of all that inventory.”

In other words, Netflix has to get better ad tech and more advertising customers to sell more ads and make more money off them.

Currently, Netflix isn’t making as much money on its ad-supported memberships as it is on ad-free, putting it at odds with other streaming competitors.

As Netflix improves its ad technology and viewership, it’s hoping that the ad tier will becoming a “more meaningful contributor” in 2025 and a “primary” revenue contributor after that.

Jon Keegan2/6/26

Report: OpenAI may tailor a version of ChatGPT for UAE that prohibits LGBTQ+ content

In June of last year, OpenAI CEO Sam Altman appeared in Abu Dhabi, UAE, alongside Nvidia CEO Jensen Huang to announce “Stargate UAE,” a project that includes a 1-gigawatt AI data center in Abu Dhabi, and a commitment to invest in the Stargate USA project.

OpenAI has announced that it is interested in jumping on the “sovereign AI” train, helping countries roll out their own AI services that reflect their own language, culture, and version of history.

Today, Semafor is reporting that OpenAI is in talks to develop a tailored version of ChatGPT for the UAE that would align with the kingdom’s conservative social laws and speech restrictions, such as disallowing discussion of LGBTQ+ content. The UAE-owned MGX investment firm is an investor in OpenAI.

The company announced its OpenAI for Countries initiative in May of last year, which aims to “help interested governments build sovereign AI capability in coordination with the U.S. government — rooted in democratic values, open markets, and trusted partnerships.”

The UAE is a monarchy with a history of human rights violations.

OpenAI’s plan for “democratic AI”

The UAE is a monarchy with a history of human rights violations.

Allen & Co Brings Together Media And Tech Titans In Sun Valley

Analysts think Amazon’s sky-high capex is a good thing, even if there’s “shock value” for investors

That said, several analysts also lowered their price targets for Amazon the day after its downbeat earnings report.

Rani Molla2/6/26

Jon Keegan2/6/26

Big Tech’s $1.1 trillion cloud computing backlog

Now that the big dogs of cloud computing have all reported their quarterly earnings, we can step back and get a sense of the searing demand that AI is driving toward their businesses.

Amazon, Google, and Microsoft each reported hundreds of billions in RPO (remaining performance obligations) — signed contracts for cloud computing services that can’t yet be filled and haven’t yet hit the books.

Collectively, the big three cloud providers reported a $1.1 TRILLION backlog of revenue.

This gargantuan demand could be good news for the “neoscalers” like CoreWeave and Nebius. But even CoreWeave is reporting a substantial backlog of its own — $55 billion last quarter.

Rani Molla

Apple of another’s AI

2/6/26

Apple is the only Big Tech company whose capex declined last quarter

One of these companies is not like the others.

Apple Headquarters in Cupertino of California

Rani Molla2/6/26

Big Tech capital expenditure soared in 2025. It’s going up another 50% in 2026.

Last quarter was one for the record books when it came to Big Tech’s purchases of property and equipment. Combined, Amazon, Alphabet, Microsoft, and Meta spent nearly $400 billion on capex, sans leases, in total last year, mostly in service of building out the AI infrastructure that they hope will furnish their futures.

And 2026 is only getting more expensive.

The four are expected to spend 50% more in 2026 than in 2025: roughly $600 billion. Amazon said it’s on the hook for $200 billion in capex this year, while Google expects to spend between $175 billion and $185 billion. Not too far behind, Meta estimated its 2026 capex would be $115 billion to $135 billion. Microsoft didn’t give an estimate, but analysts have its 2026 calendar year capex at around $114 billion. However, it should be noted that analysts’ expectations for 2026 were way lower than the reality for the rest.