Explained: Why did Netflix remove the "Basic" ad-free plan?

After Netflix removed its "Basic" ad-free plan from Canada, thousands of Americans noticed that the company did the same in their country. The streamer's $9.99 plan gave subscribers the luxury of watching their favorite shows and films without advertisements. Unfortunately, this service could be used on a single device at a time.

According to The Hollywood Reporter, the company has taken this decision to push its users into subscribing to more profitable plans. The streamer now has a $6.99 basic plan which comes with ads. Meanwhile, the ad-free plans cost $15.49 and $19.99. The former is called the "Standard" plan, while the latter is called the "Premium" plan.

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Netflix removes "Basic" ad-free plan to make profits

The "Basic" ad-free plan was first removed in Canada and then in the USA and UK. This move was made a few months after the streamer announced that sharing passwords was chargeable. Any user outside the vicinity of a particular household had to pay to avail of the service.

Executives from the company previously revealed that the ad tier drew way more revenue than the standard tier. According to The Hollywood Reporter, since the "Basic" tier is now history, users will either turn to the $6.99 add-supported plan or the $15.49 standard plan. The latter is more than double the price of the latter.

According to the streamer's FAQ section, the "Basic" plan is obsolete.

"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," the FAQ section states.

The above words meant that existing subscribers could keep the Basic plan for the time being, but that option was not available for new and returning users of the service. In May 2023, the company announced that its Basic plan with ads had garnered almost 5 million active monthly users.

After that announcement, Netflix co-CEO Greg Peters said:

"The signals are promising: engagement on our ads plan is similar to our comparable non-ads plans. That’s critical because it all starts and ends with consumers. It’s why, despite all the competition out there, Netflix is the most popular streaming service today. To be the one to watch, you need everyone watching. And that’s what sets Netflix apart."

President of worldwide advertising Jeremi Gorman added:

"We treat our ads with the same care we treat our incredible content: serving them locally; seamlessly transitioning between shows and ads with no latency; and implementing industry-leading frequency caps with an ad load of four to five minutes per hour."

Co-CEO Ted Sarandos said:

"You’ve heard a lot from us today, and I think it all boils down to one thing: Netflix is a little bit different. In the past – when consumers had very little choice of where to watch – it didn’t matter so much which network a show or film landed on. They were all very similar. Today, we believe that having a title land on Netflix makes all the difference in the world."

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What new films have Netflix released in 2023?

Here are a couple of movies the streamer has released so far this year:

• The Pale Blue Eye
• Dog Gone
• True Spirit
• We Have a Ghost
• Luther: The Fallen Sun
• Blood and Gold
• Extraction 2
• The Out-Laws

Some awaited releases are They Cloned Tyrone, Heart of Stone, The Monkey King, etc.

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