In a landmark shift for British television, the number of UK streaming subscribers on packages that include advertisements has now surpassed those on more expensive, ad-free plans. This represents a significant turning point for an industry that once championed uninterrupted viewing as its core selling point.
The End of the Ad-Free Dream?
When Netflix launched its streaming service nearly two decades ago, its promise was simple: watch anything, anytime, without a single advert. This philosophy became the bedrock of the streaming revolution. As recently as 2019, Netflix's then-CEO Reed Hastings positioned the platform as a "safe respite" free from the controversy of exploiting users with advertising.
However, the landscape has fundamentally changed. Three years ago, Netflix itself led a dramatic U-turn, introducing a cheaper, ad-supported tier to combat a post-pandemic slowdown in subscriber growth. This move paved the way for a broader industry shift.
Cost-Cutting Drives the Switch
According to research firm Ampere Analysis, the total number of UK subscribers on ad-inclusive plans is forecast to reach just under 26.5 million by the end of this year. This is an increase of almost 7 million from 2023. In stark contrast, subscribers on ad-free packages fell from 26.7 million to 23.1 million over the same period.
The driving force behind this change is overwhelmingly financial. With a proliferation of services, the monthly cost for a "typical subscriber" taking standard plans from major players like Amazon, Netflix, Disney+, Apple TV+, and others has risen to around £64. This is a 14% increase from £56 a month in 2022.
"Ongoing macroeconomic pressures mean that UK consumers are seeking more cost-effective ways of getting their entertainment services," said Richard Broughton, Executive Director at Ampere Analysis. The price difference is stark: Netflix's cheapest ad-free package now costs more than twice its ad-supported tier.
A Growing Market for Streaming Ads
While streamers have been cautious about ad load to avoid alienating long-time subscribers, the market for streaming advertisements in the UK is expanding rapidly. It is projected to be worth £1.38 billion in 2024, having more than doubled in size over the past four years. This now represents almost half of the £3.15 billion spent on traditional linear TV advertising.
The impact on traditional broadcasters like ITV, Channel 4, and Channel 5 has so far been limited. Advertisers were initially hesitant due to high prices, but the ability to target audiences watching premium content like Stranger Things is a powerful draw.
Top advertisers on UK streaming platforms now include major brands such as:
- Apple
- Tesco
- McDonald's
- Subway
- Sky
Netflix has stated it does not expect advertising to become a "primary driver of revenue" until at least 2026. Nevertheless, the subscriber numbers tell a clear story: the era of ad-free streaming as the default choice for UK households is over, replaced by a new model where a few commercials are a trade-off millions are willing to make for substantial savings.
