Breaking: Netflix Discontinues Cheapest Ad-Free Plan for New Subscribers in the US, UK
Potential Netflix users have one fewer option to sign up for today. The company has officially decided to give its $9.99 per month “Basic” plan the axe, informing users on its American Help Center page that new customers and previous Netflix users who are returning to the service will note its absence going forward.
“The Basic plan is no longer available for new or rejoining members. If you are currently on the Basic plan, you can remain on this plan until you change plans or cancel your account,” Netflix says.
The change affects users in both the United States and the United Kingdom.
As of now, new users can purchase the Standard with Ads plan for $6.99 per month, or step up to the Standard plan for $15.49 per month to go ad-free. The Premium tier also streams with no ads and incorporates higher viewing and audio quality at a $19.99 per month price point.
What Are the Differences Between Netflix Subscription Plans?
| Tier | Price Per Month | Ads Per Hour | Streams | Video Quality | Offline Mode |
|---|---|---|---|---|---|
| Standard with Ads | $6.99 | 4-5 min. per hour | 2 | 1080p | No |
| Standard | $15.49 | N/A | 2 | 1080p | Yes |
| Premium | $19.99 | N/A | 4 | 4K+HDR | Yes |
Netflix signaled such a move was in the offing in late June when it shut down the Basic tier in Canada. Since Netflix views its Canadian and American markets as highly similar — it combines subscriber numbers from both countries into one figure during earnings reports, for example — that maneuver was considered by many as a warning to American customers that they could be next.
The reason the Basic plan is being discontinued is relatively simple: money. Netflix wants to drive more users to its Standard with Ads plan, which provides the company with more money per customer than the Basic plan did, despite its higher subscription cost. Ad-supported streaming plans allow providers to double-dip on monetizing a user, as they collect both subscription dollars and revenue from advertisers for every customer watching.
It’s a similar strategy to the one Netflix used when it was rolling out new rules against password sharing. Those guidelines were made official in Canada first, several months before the same rules were enacted in the U.S. The streamer uses data it gets from the smaller Canadian market to see how its policy shifts will affect its larger American consumer base.
The move comes just hours before Netflix is due to unveil its second-quarter earnings. It’s the first earnings report after the company’s password-sharing rules were enacted, and at least one market analyst expects the streamer to have added 2 million new customers.
Netflix
Netflix is a subscription video streaming service that includes on-demand access to 3,000+ movies, 2,000+ TV Shows, and Netflix Originals like Stranger Things, Squid Game, The Crown, Tiger King, and Bridgerton. They are constantly adding new shows and movies. Some of their Academy Award-winning exclusives include Roma, Marriage Story, Mank, and Ma Rainey’s Black Bottom.