Netflix is removing its classic Essential plan at €10.99 per month for everyone. If you are still subscribed to this offer, you will soon have to change your plan and accept advertising or pay more!
It was to be expected. After removing from its catalog its classic Essential formula without advertising at €10.99 per month for new customers, Netflix will also remove it for old subscribers who benefited from it. These “loyal people” will soon have to change their offer, switching to the Essential formula with advertising or a more expensive formula.
Ad-free video streaming increasingly seems to be reserved for the deepest wallets! What was originally the main argument of SVOD (subscription video on demand) services to attract viewers tired of repeated ads between their TV programs, is becoming a more than expensive privilege. The fault lies in increased competition between platforms and the call for profitability. But Netflix decided to go a step further by removing the Essential subscription, which allowed you to enjoy the company’s entire catalog and HD quality (720p) on a single screen for €10.99 per month, In France. It was the least expensive offer if you wanted to skip advertising.
It was through a banner that Netflix shared the news on December 12, 2023. In the “Change offer” section of the “Your account” page, we can read:“The Essential offer is no longer offered. If you change your offer, you will not be able to revert to Essential.” At that time, this disappearance only concerned new subscribers: old subscribers who had subscribed to this offer could continue to benefit from it at the same price. This time, it’s over: Netflix will force them to switch to another formula.
This decision is a way of casually increasing the prices for its future subscribers, since it will now be necessary to pay €13.49 per month to benefit from SVOD without advertising – compared to €5.99 with –, and a good bad news in this period of widespread inflation, especially since the company has already significantly increased its prices since its arrival on the market. However, this is not a big surprise, because the Essential subscription had already been canceled last October in Germany, Spain, Japan, Mexico, Brazil and Australia, when it was already no longer offered in the United States, Canada, United Kingdom and Italy for a while (see our article). And, since then, the platform has hidden it in its catalog: you had to click on a very discreet link to access it on its subscription page. HAS As the Standard formula with advertising was equipped with more advantageous characteristics, such as the possibility of enjoying two screens simultaneously and Full HD quality, the future of the Essential formula seemed more than compromised…
Netflix prices: 67% increase since the beginning
This decision comes after a significant price increase last October. In fact, the Standard offer with advertising remained at the price of €5.99 per month, while the Essential subscription increased from €8.99 to €10.99 per month – an increase of 22%. . For its part, the Standard subscription remained at €13.49. On the other hand, the Premium formula had undergone an increase of 11%, going from €17.99 to €19.99 – which, at around €240 per year, represents a significant budget for a family.
In France, Netflix has increased its prices twice since January 2019 for its ad-free offers. The Standard subscription thus increased from €8.99 per month in 2014 to €11.99 per month in June 2019, before increasing to €13.49 in August 2021, a total increase of 50%! At the same time, the Premium plan, offered at €11.99 per month in 2014, then increased from €13.99 per month, then to 15.99 euros, then to €17.99, before reaching the €19.99, or 67% increase in total. As for the Essential offer, it had “only” increased by 38% since its launch, going from €7.99 to €8.99 per month, before finally reaching €10.99. In the meantime, Netflix has set up a significantly cheaper entry-level plan, at €5.99 per month, but with advertising breaks called simply Standard with advertising (see our article).
The very serous Wall Street Journal had warned of this increase in its edition of Tuesday October 3, 2023. According to the American daily, the streaming platform was in fact preparing to once again revise its prices upwards. In the United States and Canada initially, but it was suspected that other countries would have to follow, as had been the case with previous tariff changes.
Netflix increase: an increase to better pay screenwriters?
Netflix’s motivations are multiple. First, like all companies and individuals, the platform must face generalized inflation, with a significant increase in the costs of the energy essential to its servers. Then, after reigning supreme over video on demand for a long time, Netflix must now face formidable competition, in particular from Disney+ – which also has its own prices (see our article) –, Amazon Prime Video – which is preparing to introduce advertising into its basic offering – Paramount+ and Max – which will soon arrive in France.
Finally, and above all, the platform was not spared by the strike of screenwriters and actors in Hollywood. A social movement which blocked all audiovisual productions for months, these creative professionals demanding better remuneration and safeguards in the face of the arrival in the introduction of generative artificial intelligence which could completely change the rules of game, leading to numerous job cuts. Agreements were finally reached last October with the writers, which will have an economic impact for streaming platforms like Netflix if they wish to continue producing new original content.
The fact remains that Netflix had a very good third quarter with a turnover of 8.5 billion dollars (i.e. +8% compared to last year), profits of 1.7 billion (+20%) and 8.8 million new subscribers. Results that stem from SVOD’s decision to charge for account sharing, which has proven to be very lucrative for the company. “The churn level remains low, beyond our expectations, and the conversion of those using a third party account into paying subscribers demonstrates good retention,” she rejoices. Everything is going well in the best of all possible worlds… except for the users’ wallets!