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Aiming to shore up its subscriber base through a cheaper plan, Netflix co-CEO Ted Sarandos on 23 June confirmed that the online streaming platform is working on adding a new ad-supported tier to its subscription offerings.

Sarandos, while speaking at the Cannes Lions advertising festival, said that the firm following a loss of 2,00,000 subscribers last quarter, the firm would be introducing a less-expensive ad-supported tier to its service in a bid to bring in new customers.

ALSO READ: Netflix lays off hundreds of employees in second round of job cuts

"We’ve left a big customer segment off the table, which is people who say: ‘Hey, Netflix is too expensive for me and I don’t mind advertising,'" The Hollywood Reporter quoted Sarandos speaking on the Cannes Lions stage with Sway podcast host Kara Swisher.

"We adding an ad tier; we’re not adding ads to Netflix as you know it today. We’re adding an ad tier for folks who say, ‘Hey, I want a lower price and I’ll watch ads.'" Sarandos added.

Netflix’s presence at Cannes Lions is a clear sign the company is looking to embrace the ad industry, adds the report. Also, Sarandos confirmed that the company is in talks with potential ad-sales partners.

Though Netflix spokesperson told Engadget that the company was "still in the early days" of developing the ad-based tier, and hadn't nailed down its approach.

"We are still in the early days of deciding how to launch a lower priced, ad supported option and no decisions have been made. So this is all just speculation at this point," the statement reads.

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