Disney+ is home to a plethora of content from Marvel, Star Wars, Pixar, Disney, and National Geographic. The popular streaming service has experienced exponential growth in its subscriber count over the years, while also consistently expanding its content library. As Disney+ expands with fresh shows and movies, the House of Mouse recently decided to stir things up by adding a new way for consumers to enjoy the service with advertisements.
Disney+ has been ad-free ever since its launch in November 2019, but this new payment plan will offer subscribers Disney+ at a reduced rate with commercials. Reports have emerged that the reason behind this change was partly due to the popularity of Marvel and Star Wars, thus making advertisers interested in jumping aboard the Disney+ hype.
Now, new details about the new subscriber option has emerged.
Disney+ Expands with Ad Tier Option
Disney+ is set to expand its plans by adding a new ad tier option.
Disney's president of ad sales and partnerships Rita Ferro sat down with the Wall Street Journal to explain the streaming service's new subscriber option while also sharing the House of Mouse's plan for collecting data:
“We’re never going to collect data on individual kids to target them."
In the report, it was revealed that the plan is to have about a four-minute-an-hour ad load, which is strikingly smaller than most of Disney+'s rivals and what can be found on traditional TV.
Ferro revealed that the ad-supported tier of Hulu shows commercials for "nearly twice as much time as Disney+."
In comparison, NBC Universal's Peacock service has about five minutes of commercials within an hour, while Warner Bros. shared that HBO Max would not have more than four minutes of ads an hour. In traditional TV, ad loads are usually between the 18 and 23-minute range per hour, based on Kantar's research.
Wall Street Journal noted that ad buyers are saying that Disney+ is seeking to charge advertisers $50 to $60 for reaching 1,000 viewers. However, Disney declined to comment on the aforementioned pricing.
Still, ad buyers unveiled that the price range is in line with other top streaming services. Despite that, the price is still expensive, considering that brands are unable to request having their ad appear on specific programming.
Amidst all of that, WSJ acknowledged the fact that the prospect of ads on Disney+ is an exciting one, mainly because streaming services are best when it comes to reaching young people since this social group is using traditional television less and less.
In a separate report, Variety noted that Disney has already alerted ad agencies that the new tier option of Disney+ will not accept "alcohol or political advertising" at its launch. In addition, Disney+ is also not expected to take ads from rival outlets or entertainment studios, in order to prevent rivals from luring away subscribers.
Disney is set to be cautious as well about running commercials alongside "shows aimed at pre-school audiences." It will also not run ads when a user profile indicates that a young child is watching the shows.
Will Ads Hurt Disney+ in the Long Run?
While advertisements may be cumbersome for some, a cheaper option is an advantage for consumers who have yet to purchase a Disney+ subscription. This move is also a welcome development for international territories, mainly because they can offer it at a more affordable price point.
Still, there is an unfortunate circumstance when it comes to ad-based subscription tiers. Ad-based platforms are subject to frequent social media complaints of the nuisance caused by interruptions.
It could also potentially disrupt a key feature that Disney+ introduced, which is the GroupWatch program. If one user is subscribed to an ad-tier-based plan, then that viewer will not have a seamless watch party with the rest of the group who availed of the ad-free premium.
Also interesting is the note that younger viewers may not be subject to ads. Could this be a potential workaround for subscribers at the ad-supported tier?
Whatever the case, Disney is expected to ultimately find a way to please subscribers in the long run, and it's safe to assume that this is only the beginning of new innovations.