Netflix's ad plan now drives most new subscriber growth globally

Netflix's ad-supported plan now drives the majority of new customer sign-ups in markets where it is available, confirming the platform's strategic pivot toward a dual revenue model of subscriptions and advertising. The announcement cements the industry-wide move toward television-like business practices.

The ad-tier pivot

The company's "Standard with ads" plan has become its primary engine for subscriber acquisition. This holds true across the 12 countries where the option is currently offered. Netflix, the streaming service behind the acclaimed drama The Crown which concluded in 2023, initially resisted advertising for more than a decade before launching the lower-cost tier in November 2022. The move was a direct response to slowing subscriber growth and increased market competition.

The ad-supported plan offers a lower monthly price in exchange for viewers watching approximately four to five minutes of commercials per hour. While Netflix has not released figures breaking down the exact percentage of new sign-ups, company executives have repeatedly stated in earnings calls that the ad tier is exhibiting strong momentum and that most new additions are opting for it.

A new streaming normal

Netflix's success with advertising mirrors a larger industry-wide trend. Nearly every major streaming service has now embraced a similar strategy. Disney+, which launched its own ad-based plan in late 2022, and Max have both made ad-supported options central to their growth strategies. This marks a significant convergence between the once-disruptive streaming model and the linear television business it sought to replace.

For streamers, the benefits are clear. Ad-supported tiers provide a more accessible entry point for price-sensitive consumers in a crowded marketplace, while simultaneously opening up a lucrative second revenue stream from advertisers. The shift suggests the future of streaming will look much like the past of television: a hybrid ecosystem where consumers can choose to pay less if they are willing to watch ads.