Disney+ to introduce ad-supported plan as market shuns SVOD

Disney is to introduce an ad-supported plan to its streaming service Disney+ later this year in a bid to reach 260 million subscribers by 2024.

Set to roll out in the US in late 2022 followed by the international markets in 2023, Disney will provide consumers with service cheaper than its $7.99 ad-free service. “Expanding access to Disney Plus to a broader audience at a lower price point is a win for everyone – consumers, advertisers and our storytellers,” said Kareem Daniel, chairman of Disney Media and Entertainment Distribution.

The move reflects the growing trend toward ad-supported video on demand (AVOD) as consumers tire of expensive plans and service stacking. Recent Comcast research revealed 80% of consumers prefer an ad-supported service over a higher cost ad-free SVOD service.

The news comes as ITV’s share plummeted by 30% following its announcement of its SVOD service ITVX, signaling a loss of confidence in the subscription model.

Disney+ will follow the likes of Peacock, Paramount+ and Discovery+, which all have ad-free tiers.

“More consumers will be able to access our amazing content. Advertisers will be able to reach a wider audience, and our storytellers will be able to share their incredible work with more fans and families,” Daniel said.

Disney+ currently costs $7.99 per month and since its 2020 launch has netted 130 million global subscribers.

“Since its launch, advertisers have been clamoring for the opportunity to be part of Disney+ and not just because there’s a growing demand for more streaming inventory,” added Rita Ferro, president, advertising, Disney Media and Entertainment Distribution.

Disney’s ad-supported announcement follows today’s news that Disney Advertising Sales is partnering with Horizon Media to help it expand the measurement capabilities of its data clean room.