As if Netflix wasn’t getting expensive enough, the streamer has now confirmed that it will be “retiring” the Basic ad-free tier. Essentially raising the cost of being able to watch Netflix content without being subjected to commercials. Which is kind of funny, considering how Netflix pushed back against the idea of advertising on its platform for so long.
Netflix confirmed this change to shareholders and executives during its latest earnings call. Essentially Netflix is taking the next step to scrapping its Basic ad-free plan in countries where Netflix with ads is available. This kicked off last year, when the streamer stopped new and returning subscribers from signing up for the plan in the U.S., U.K. and Canada.
Netflix has said is that it is looking to “retire” the ad-free Basic plan, starting with the U.K. and Canada in Q2 2024. This will presumably happen in the U.S. at some point as well, but it's unclear when.
Netflix has also confirmed that anyone still on a $11.99 Basic subscription plan will have to switch to another Netflix tier. Your ad-free options are the $15.49 Standard tier or the $22.99 Premium tier, and either option is essentially another price hike. The Standard with ads tier costs $6.99, but obviously subjects you to advertising while you stream.
Netflix has been quick to specify that the Standard tier does come with perks not available to Basic subscribers — regardless of whether you choose the ad-supported or ad-free option. There's Full HD resolution and the option to watch two streams simultaneously, but is that worth an extra $2.50 a month?
Maybe if you made that choice independently, rather than because Netflix gave you no choice. I have no idea how many people are still on a Basic Netflix subscription, but I can't imagine any of them will be thrilled to have to choose between paying more or watching commercials.
If I were to guess, Netflix is hoping on those subscribers dropping down to its ad-supported tier. But considering Netflix with ads is already $5 cheaper and offers better video quality than the Basic tier, I'd wager anyone happy with advertising would either have made the switch or was planning on doing so anyway.
Still, it’s interesting to see how Netflix’s view on advertising has changed the past few years. Especially since Netflix co-founder and former-CEO Reed Hastings insisted the company had no interest in the ads business as recently as 2020.
I guess increasing competition (and new leadership) will do that to a company. Especially when they realized just how valuable customers viewing ads actually were. More financially valuable than subscribers on the ad-free Standard plan according to Netflix’s Q1 2023 earnings call.
It's going to be interesting to see how this plays out, and how long it'll take for Basic to be retired in the United States.
This post has been updated with official details from Netflix.
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Tom is the Tom's Guide's UK Phones Editor, tackling the latest smartphone news and vocally expressing his opinions about upcoming features or changes. It's long way from his days as editor of Gizmodo UK, when pretty much everything was on the table. He’s usually found trying to squeeze another giant Lego set onto the shelf, draining very large cups of coffee, or complaining about how terrible his Smart TV is.
Well, Netflix needs to find some way to pay the more than $5 billion -- FIVE B-B-B-BILLION DOLLARS -- it has agreed to pay the WWE for its ridiculous fake sport broadcast rights, I suppose.Reply
It's just a darn shame that part of it will be coming out of my pocket.
what % of marketing & ad revenue is shared to Netflix?Reply
It's the price model, not the features that come with each tier. Consumers will always go for the cheaper version if they can. As long as Netflix doesn't go the route of Hulu and Paramount with ads every ten minutes, many will endure one ad every 30 mins. They should have the ads at beginning and end of show, and "maybe" in the middle. Doing a series of "repetitive" ads every ten minutes takes away from the enjoyment and thought process & continuity of a show or event, rendering shows meaningless and NOT enjoyable--and numerous clicks and walkaways. Hour shows--especially news-- are really only 30 mins or less in total length. C ya Netflix, and Amazon Prime going that way as well. Gonna go read a book...get rid of my tv
This is crazy, why don't they just charge those who want WWE or F whatever, extra, and let us who never cared for it, stay paying a reasonable price!?Reply