I agree, but they’d get a large number of users to subscribe.
And then maybe they wouldn’t complain when they raised the price to $3. And a few months later maybe $3.50. Then $5.
A few years ago, people wouldn’t have paid over $15 for a standard Netflix tier without 4K. But the way to boil a frog is to make them nice and comfy in lukewarm water, then keep increasing the temperature slowly… So even if they lose money, maybe a low price for the ad-free YouTube could make sense, from a business perspective.