Netflix has removed its $9.99 ad-free “Basic” plan in the US and UK, forcing new customers to sign up for a more lucrative subscription option for the streaming giant.
Go to its registration page Netflix On Wednesday morning it showed just three options for new customers: its $6.99 “standard with ads” tier, $15.49 “standard” plan and $19.99 “premium” plan, both without ads.
In an FAQ on its signup page, the company wrote that “The Basic plan is no longer available to new members or rejoiners. If you currently have a Basic plan, you can stay on that plan until you change plans or cancel your account.” In other words, current Basic Plan customers can keep that plan for now, and the new changes only apply to new customers or those who re-subscribe.
A spokesman for it Netflix declined to comment.
Its executives Netflix They said the ad-inclusive tier already generates higher revenue per subscriber than their standard tier, though they added that they are neutral on which tier users choose to subscribe to. The removal of the Basic plan will force new users to choose between the ad-supported plan or the standard plan, which more than doubles the price of the ad-supported plan.
A month after removing the basic plan in the US, the company made the same move in Canada
Promotion level Netflix, which launched late last year as “basic with ads,” now has “nearly 5 million” monthly active users, the company said in its first ad preview presentation in May. Active users are not the same as subscribers (perhaps a subscription can have multiple users), but this is a step in that direction.
The company also said that engagement with its ad-supported plan is, like its ad-free plan, an important piece of data because the more time users spend with a service, the more ad revenue it can generate.
Netflix Earnings are scheduled to be reported after markets close on Wednesday afternoon.
Through: The Hollywood Reporter
Editor’s note: Remember when we paid for cable TV with ads and then these streaming platforms came out where you just had to pay a monthly fee and there were no ads? Explain to a time traveler how we got to where we are.
