The price gap between ad-supported and ad-free plans for both Netflix and Paramount Plus is growing with the removal of the least expensive ad-free plan on both services in some regions. Netflix has dropped its “Basic” ad-free plan in Canada, which used to cost $9.99 CAD per month, as reported by TechCrunch. Meanwhile, Paramount Plus has dropped its least expensive ad-free plan, which used to cost $9.99 in the US, and is also increasing the price of its cheapest ad-supported plan from $4.99 to $5.99 per month.
Sitting between Netflix’s $5.99 CAD ad-supported plan and the $16.49 CAD “Standard” ad-free plan used to be a $9.99 CAD “Basic” plan. That has been dropped in Canada, making the jump from a plan with ads to one without ads a whopping $10.50 CAD. While this change has only happened in Canada and, currently, only affects new customers, it’s likely that this trend will extend to other regions and existing customers at some point.
Netflix has already stated that its ad-supported plans are more profitable than its ad-free plan on a per customer basis. That likely explains why it’s pushing new customers towards its ad-supported plan over its cheapest ad-free plan. In most regions, Netflix already hides its cheapest ad-free plan behind a “See All Plans” button, so it seems like just a matter of time before the budget ad-free plan and the button disappear.
In a similar move, Paramount Plus has dropped its $9.99 ad-free plan, which did not include Showtime, leaving its $11.99 plan with Showtime as the only ad-free option. Paramount Plus has simultaneously increased the price of its ad-supported plan from $4.99 to $5.99 per month. While this simplifies Paramount Plus’ offerings to just two plans, it increases the gap between ad-support and ad-free plans.
As streaming services continue to fine tune their offerings, the least profitable plans are being made more expensive or being dropped altogether. These changes by Netflix and Paramount Plus seem to indicate that the mid-tier ad-free plans are going to be the first ones to go.