Netflix to scrap its cheapest ad-free subscription plan

Netflix has revealed it will be 'phasing out' its cheapest advert-free tier, starting with the UK and Canada. The move will see the streaming service offer just three subscription plans once its 'basic' £6.99 a month plan is scrapped.

Instead members must soon fork out an extra £4 a month for the 'premium' subscription to keep their streaming advert-free. Or, they can save a bit of money by opting for the advert-supported £4.99 a month plan.

The company's latest financial report, published on Tuesday (January 23), said the advert-supported plans accounted for 40% of all sign-ups and had increased by almost 70% quarter over quarter. The report added: "We’re looking to retire our Basic plan in some of our ads countries, starting with Canada and the UK in Q2 and taking it from there."

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Netflix did not mention an exact date the basic plan would be scrapped, but it could be anytime between the start of April until the end of June. The plan's phase out began last year, when it was axed for new and returning customers.

The streaming giant also launched a clamp down on password sharing. The shake-up meant that non-household members on standard and premium plans had to pay an additional £4.99 a month to continue their subscriptions.

It comes as the company's fourth-quarter results showed a huge increase of 13.1 million worldwide subscribers during the October-December period, well above analyst projections, according to FactSet Research. The holiday season gains — the biggest Netflix has posted in the fourth quarter — exceeded the 8.8 million additional subscribers Netflix posted in the July-September period, which in turn jumped above the numbers