Netflix is kicking US subscribers off its cheapest ad-free plan soon

Netflix today confirmed suspicions that it will stop letting people pay $12 per month to stream without commercials.

The ad-free Basic plan was the cheapest way to watch Netflix without commercials. The plan limits users to 720p resolution and one device and lets people download content. Netflix stopped offering the Basic plan to new subscribers in January. In June, Netflix started booting subscribers in the UK and Canada off the plan and automatically put them onto a cheaper subscription plan with ads.

In a letter to shareholders today [PDF], Netflix confirmed publicly for the first time that it “will now start” to phase out the ad-free Basic plan in the US and France. This will make the cheapest commercial-free Netflix plan $15.49/month in the US. That Standard plan supports up to two devices, downloads, and 1080p resolution.

Netflix thinks killing the Basic plan will help it gain more subscribers who watch commercials, which, on average, generates more revenue for the company.

As expected from a streaming company these days, Netflix touted its ad tier to shareholders, noting that the $7 tier now represents “over 45 percent” of new sign-ups in areas where it’s sold. Per Netflix’s letter, ads will only be an increasingly larger part of its strategy, as Netflix aims to “achieve critical ad subscriber scale for advertisers in our ad countries in 2025, creating a strong base from which we can further increase our ad membership in 2026 and beyond.”

The news comes as streamers grapple with increasing streaming subscription costs. Netflix most recently hiked pricing in October. In January, the company suggested to shareholders that more price hikes were possible, saying that it would “occasionally ask our members to pay a little extra to reflect” platform improvements.

Not cozying up with competition

If today’s news makes you hope for a convenient streaming-only deal that lets you subscribe to Netflix and another video streaming service for cheaper, you’re out of luck. Netflix today said it’s not interested in streaming-only bundles.

Bundle deals, which combine streaming and other services for a cheaper subscription rate, have become the streaming industry’s answer to high cancellation rates among subscribers, including those who quickly cancel and resubscribe depending on what’s available to stream that month.

In its letter, Netflix noted that although cable or mobile providers or device-makers may offer deals combining Netflix and another streaming service, Netflix does not make deals that bundle it with another rival streamer, like Disney+ or Max. The company claimed that Netflix is already “a go-to destination,” which “limits the benefit to Netflix of bundling directly with other streamers.”

That means if you’re hoping to save money on your Netflix subscription, which keeps getting more expensive, the only options are to watch Netflix with commercials or get a cable-reminiscent bundle that includes a different kind of service, like Comcast or Verizon Wireless.

We know which option Netflix would like you to pick. But for frustrated streamers, finding a reasonable way to watch all the stuff you want online the way you want keeps getting harder.