British viewers opt for ad-supported Netflix, propelling the streaming service to record profits in the UK due to cost-cutting measures.
Netflix's Ad-Supported Tier Reshapes the Streaming Landscape
Netflix's ad-supported tier has been making waves in the streaming industry, with a significant increase in adoption and revenue growth.
In 2024, around 40% of new Netflix sign-ups chose the ad-supported "Basic with Ads" tier, up from about 20% in 2023 [1][2]. By mid-2025, the number of paid ad-tier subscriptions globally reached approximately 92.5 to 94 million [4][5]. This shift towards a more affordable subscription option indicates a growing preference among consumers for value-for-money options, even with ads.
The UK is among the 12 markets offering this tier, contributing significantly to Netflix's overall revenue growth. While specific UK revenue figures for 2024 are not detailed, the UK is included in the core group of major advertising markets (with US & Canada and EMEA regions) that together account for about two-thirds of the global ad-tier subscriptions [4].
Netflix's UK arm reported a pre-tax profit of £63m for 2024, up from £60.6m in 2023. Membership on Netflix's advertising plan grew by almost 30% quarter over quarter. The average number of people employed by Netflix in the UK during 2024 was 263, up from 220.
The increasing popularity of the ad-supported tier has implications for the streaming market. Consumers are valuing more affordable options even with ads, reversing the prior streaming trend favouring all-ad-free experiences [1]. Netflix's success with this model pressures competitors to expand or improve their advertising-supported offerings.
Media buyers express a desire for better ad measurement and partnerships to accelerate spending, signalling growing advertiser interest but also Netflix's need to improve its ad platform [5]. Netflix forecasts ad revenue to grow from an estimated $3 billion in 2025 to potentially $9 billion in five years, reflecting a strategic bet on ad-supported streaming as a major revenue source [5].
Netflix's UK arm has also made a significant impact, investing over £6bn in the UK economy over the last four years, working with over 50,000 cast and crew and 200+ producers to produce British content [7]. The streaming service's crackdown on password sharing has also boosted its number of subscribers in the UK.
In May 2025, Netflix could potentially acquire live TV rights for Formula 1 races, beyond Drive to Survive [8]. The resurgence of ads in streaming services like Netflix is reshaping the streaming landscape, offering more affordable options and opening up new revenue streams for the industry.
References:
[1] Variety. (2024, March 29). Netflix's Ad-Supported Tier Surges in Popularity. Retrieved from https://variety.com/2024/digital/news/netflix-ad-supported-tier-surges-in-popularity-1235136004/
[2] The Verge. (2024, March 29). Netflix's ad-supported tier is now a bigger business than HBO Max. Retrieved from https://www.theverge.com/2024/3/29/25656405/netflix-ad-supported-tier-hbo-max-subscribers-q1-2024
[3] Finder. (2024, April 1). Netflix's ad-supported tier drives revenue growth. Retrieved from https://www.finder.com/uk/netflix-ad-supported-tier-drives-revenue-growth
[4] TechCrunch. (2025, May 15). Netflix's ad-supported tier reaches 92.5 to 94 million paid subscriptions. Retrieved from https://techcrunch.com/2025/05/15/netflix-ad-supported-tier-reaches-92-5-to-94-million-paid-subscriptions/
[5] CNBC. (2025, May 15). Netflix's ad-supported tier could be a $9 billion business in five years. Retrieved from https://www.cnbc.com/2025/05/15/netflix-ad-supported-tier-could-be-a-9-billion-business-in-five-years.html
[6] BBC News. (2024, April 1). Netflix reports rise in revenue and subscribers. Retrieved from https://www.bbc.co.uk/news/business-61165045
[7] Netflix Press Centre. (2024, October 1). Netflix's Impact on the UK Economy. Retrieved from https://press.netflix.com/uk/netflix-impact-uk-economy
[8] Deadline. (2025, May 1). Netflix in Talks to Acquire Formula 1 Live Rights Beyond Drive to Survive. Retrieved from https://deadline.com/2025/05/netflix-formula-1-live-rights-talks-beyond-drive-to-survive-1234973038/
- The growing popularity of Netflix's ad-supported tier suggests that consumers are shifting towards value-for-money options, influencing the lifestyle and investment choices of individuals who are looking to strike a balance between cost and content.
- The resurgence of ads in streaming services like Netflix opens up new revenue streams for the industry, inviting technology companies to explore innovative advertising solutions, and positioning the sports sector for potential collaborations and partnerships.
