Netflix cancels its basic ad-free plan for new subscribers

Netflix (NFLX) dropped ad-free subscription least expensive in the US and UK with the aim of increasing revenue and attracting more users to the ad-supported offering it posted last year. #39;last year.

Key Points to Remember

Netflix has dropped its basic ad-free plan, which cost $9.99 per month.
The cheapest option for users will now be a $6.99 per month plan with advertising, which the company launched in November.
This is part of an effort to increase revenue and attract more users to the ad-supported plan.

How does this impact Netflix users?

The platform's basic ad-free plan, which costs $9.99 per month, was no longer available on the company's website for new members or new members as of Wednesday. Customers who are currently subscribed to the plan will not be affected unless they change plans or cancel.

The cheapest option for subscribers will now be a $6.99 per month ad-supported plan, which the company introduced in November. It offers HD viewing of all but a few movies and shows, the ability to stream on two devices, and access to unlimited mobile games, according to Netflix's website.

Netflix Advertising -Supported Plans to Generate Revenue

Executives have praised the new ad-supported plan in the past, touting it as a key revenue driver.

'In the US it's actually even higher than our standard plan,' Chief Financial Officer Spencer Adam Neumann said of the plan's earnings, during the company's first-quarter earnings call in April.

Netflix Releases Second Quarter Results quarter Wednesday afternoon.

Other options are Netflix's Standard and Premium plans, which are ad-free and allow users to download content and share their account with one or two people outside their household, but are more expensive at $15.49 and $19.99 per month, respectively. The Premium plan also allows Ultra HD viewing on up to four devices and downloads on up to six.

Netflix is the latest major entertainment company to introduce ads to its streaming service in a bid to boost revenue and profits. Earlier this year, the company cracked down on account sharing between households after seeing subscriber growth stall, blaming it in part on users sharing their login credentials with friends and other households. .

Netflix's former CEO Reed Hastings admitted last year that the company was slow to embrace advertising because it was primarily focused on competing with big tech companies. Other streaming platforms, including HBO Max, Hulu, Peacock and Paramount+, already had cheaper, ad-supported options, while Disney (DIS) was actively developing one for its platform. -Disney+ streaming form.

Netflix shares were at little near stable Wednesday after the announcement. They are up over 60% so far this year.