A Netflix logo is shown on a TV screen ahead of a Swiss vote in this depiction.
On its website, Google said that the $9.99 a month basic plan would no longer be available for new or rejoining members. Users who are currently on the plan can continue to stay on it until they cancel their plans or change their plans.
The streaming video giant launched a $7-per-month option for ads last November in 12 countries, including the U.S. as an alternative to ad-free plans. It was designed to draw in more customers and create a new revenue stream as competition for online viewers increased.
Netflix had also cracked down on people sharing passwords in May and forced users who share an account outside the same home to pay an additional fee, which in turn triggered drives of users to sign up for its cheaper ad-tier base.
We expect the most important aspect of Netflix's crackdown on password sharing will be the catalyst it creates to attract more users to its $9.99 ad tier base, in turn generating higher revenue from advertising, Macquarie analysts said.
In May, the company reported that the ad-supported tier had reached nearly 5 million active users annually, in a pitch that emphasized the breadth of its programming to potential advertisers.
The company is scheduled to release its second-quarter results after markets today, where investors will assess risks from the ongoing strike in Hollywood.