Netflix's New $20 Ad-Free Plan Pushes Streaming Closer to Old TV
Netflix raised the US price of its ad-free standard plan to $20 a month. The move is designed to push more users toward the cheaper ad-supported tier, and analysts read it as fresh evidence that streaming is converging with the old pay-TV model.
Netflix raised its US ad-free standard plan to $19.99 a month, up from $17.99. The increase continues a series of step-by-step price hikes that have made the company's ad-supported tier — currently $7.99 a month — look comparatively cheap by design.
Analysts said the move shifts more of Netflix's growth strategy toward higher revenue per user rather than subscriber adds. The ad tier lets the company keep account totals intact while stacking subscription and advertising income on top of each other, lifting average per-user revenue.
According to CNBC, the new price puts the US ad-free plan within striking distance of a traditional cable package. Wall Street has welcomed the pricing power as supportive of the stock's recent run, though investors will watch closely next quarter for how quickly price-sensitive viewers migrate to the cheaper ad-supported tier.
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