I don’t get it how people can be so dumb to go for that…also paying full price for Netflix. For about 5 years I am paying about 5 CHF (1:1 to USD) For Netflix UHD over Turkey. Just Google how 
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Netflix Launches 'Basic With Ads' Plan, But It Doesn't Currently Work on Apple TV
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Yes it would, they have to simply charge more to their advertisers. I’ve been advocating this for years.
Tier 1 - Free with Lots of ads
Tier 2 - Cheap with some ads
Tier 3 - No ads
CBS All Access used to sort of do this (before they become Paramount+). I used to watch on their site (CBS.com) without an account nor sub, for free (but episodes did expire). IIRC, it was roughly 8 minutes of commercials per 1-hour time slot of TV (so around 42 to 54 minutes of actual air time). I heard their $7/mo plan with limited commercials was indeed half the duration of commercials. Don't know if anybody does that anymore. Perhaps Peacock since they have 3 tiers? However, I think the only differences between their basic and Premium (middle one) tiers is Basic is free, limits the # of hours you can watch per year, and not all of the full content is available. They're both still the same amount of ads.
It guess it depends on the streaming service (ss). For example, Hulu w-ads when it was only $1 per month (via Thanksgiving/black Friday promo) makes far more money than Hulu ad-free at $13 per month. To the dismay of Hulu users, this is why the latter is never discounted
You do have some "lesser" ss like Freevee and Peacock basic tier (the lowest one) that are free, and completely ad supported. YouTube has always been free (although I'm glad I was able to get in on a YouTube Premium family plan, as I could swear they doubled the amount of ads in recent weeks).
Don't know if Peacock Plus vs Premium is just ads now still, but Paramount+ now locks some content to Premium like sports.CBS All Access used to sort of do this (before they become Paramount+). I used to watch on their site (CBS.com) without an account nor sub, for free (but episodes did expire). IIRC, it was roughly 8 minutes of commercials per 1-hour time slot of TV (so around 42 to 54 minutes of actual air time). I heard their $7/mo plan with limited commercials was indeed half the duration of commercials. Don't know if anybody does that anymore. Perhaps Peacock since they have 3 tiers? However, I think the only differences between their basic and Premium (middle one) tiers is Basic is free, limits the # of hours you can watch per year, and not all of the full content is available. They're both still the same amount of ads.
It guess it depends on the streaming service (ss). For example, Hulu w-ads when it was only $1 per month (via Thanksgiving/black Friday promo) makes far more money than Hulu ad-free at $13 per month. To the dismay of Hulu users, this is why the latter is never discounted
You do have some "lesser" ss like Freevee and Peacock basic tier (the lowest one) that are free, and completely ad supported. YouTube has always been free (although I'm glad I was able to get in on a YouTube Premium family plan, as I could swear they doubled the amount of ads in recent weeks).
Some may want that or 480p for their phones, or otherwise lower bandwidth/smaller data caps.
For me, my beef is with 64 GB base storage. That needs to be 128 GB these days, minimum.
I first got cable in 1974 in Benton Harbor Michigan. It was in an apartment complex I lived in. I clearly remember the sales pitch of "No Commercials". It was brand new at the complex and I had just moved in.
Besides premium movie channels like HBO, pay-per view channels, and local government information/access channels, do you recall what commercial-free channels were available on your system in 1974?