Alphabet’s YouTube Launches Cheaper Paid Ad-Free Plan In US As Global Subscriber Number Tops 125M: Retail Sentiment Lags

Alphabet, Inc. (GOOG) (GOOGL) has announced a new cheaper, ad-free subscription tier for its YouTube video hosting platform.

In a blog post late Wednesday, Jack Greenberg, Director and Product Management of YouTube Premium, said the company will begin expanding its “Premium Lite” pilot to its U.S. users. 

The new plan will provide users with a cheaper way to access most videos, with the price fixed at $7.99 per month compared to the $13.99 per month for the “Premium” Plan.

The Premium plan’s provisions of an ad-free option for music and music videos as well as allowing downloads and background play, are not available with the Premium Lite plan, with the latter mainly targeting users who do not watch music videos or listen to music.

Greenberg said the new plan will be available to all users in its current pilot countries, which include Thailand, Germany, and Australia, in the coming weeks.

The executive updated that YouTube Music and Premium now have over 125 million subscribers, which includes trials, globally. “YouTube Music and Premium, and the expansion of Premium Lite, also continue to create additional revenue opportunities for our creators and partners,” he said.

Alphabet reported revenue of $10.47 million from YouTube ads in the fourth quarter (Q4) of the fiscal year ending Dec. 31, 2024. This made up roughly 11% of its total revenue. Subscription revenue from YouTube is clubbed under Google Subscriptions, platforms and devices, which together contributed $11.63 million. 

CEO Sundar Pichai said on the third quarter (Q3) earnings call in October that YouTube’s combined ad and subscription revenue surpassed over $50 billion on a trailing 12-month basis. 

On Stocktwits, the retail sentiment toward Alphabet stock stayed ‘bearish’ (37/100), and message volume tapered off to ‘normal’ levels.

Alphabet stock fell about 1% in premarket trading, and has lost about 8.60% year-to-date, with the weakness resulting from the macro concerns.

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