Benchmark stays cautious on Netflix, despite 'surprise' Microsoft deal for advertising
Mario Tama

Netflix (NASDAQ:NFLX) shares dipped on Thursday as investment firm Benchmark said it remained "cautious" on the company, despite yesterday's announcement that it would be partnering with Microsoft (NASDAQ:MSFT) on advertising.
"The new pact attests to Netflixâs aggressive late 2022 AVOD time-to-market ambition and concomitant necessity for a full outside ad tech stack," analyst Matthew Harrigan wrote in a note to clients, caveating that Microsoft (MSFT) "is not perceived as a first-tier digital video ad tech ecosystem entrant" like Google (GOOG) (GOOGL), NBCUniversal/FreeWheel (CMCSA), Roku (ROKU) or The Trade Desk (TTD). 
"Market complexities suggest it might have been advisable to also work in tandem with companies besides Microsoft as its pre-Xandr acquisition ad serving experience was concentrated on the Bing search engine," Harrigan added.
Conversely, it was recently reported that Walt Disney (DIS) had signed a deal with The Trade Desk (TTD) to allow for targeted automated ads across Disney properties.
Netflix (NFLX) shares fell 0.75% to $175.24 in premarket trading.
Harrigan noted that Netflix (NFLX) will have to divulge full viewing information to make sure the ad market is satisfied, which would be a departure from its DNA.
Earlier this week, it was reported that Netflix (NFLX) was in talks to revamp its content deals with Hollywood studios as part of its new advertising-supported streaming TV option.