This recent move follows Netflix’s unexpected introduction of an ad-supported tier in November 2022, despite previously stating that it would not offer such an option. The ad-supported tier was launched in Canada, the United States, and ten other countries. By removing the basic plan, Netflix is nudging more of its customers towards the ad-filled viewing experience. The motivation behind this decision is simple: Ad-supported plans can be highly lucrative for Netflix’s financial performance. Surprisingly, in the first quarter of 2023, the basic plan with ads brought in more revenue per user in the US than the standard plan, even though the ad-supported tier was priced at $6.99, compared to the standard plan’s cost of $15.49.
