AppleInsider Staff
While other streaming services experiment with ad-supported tiers to grow subscriber numbers, Disney is content with keeping its premium Disney+ service a completely for-pay experience.
Speaking at the Credit Suisse 23rd Annual Communications Conference, Disney CEO Bob Chapek said the company has no plans to add an ad-supported tier to Disney+ in the near future, reports The Verge.
"We're always reevaluating how we go to market across the world, but we've got no such plans now to do that. We're happy with the models that we've got right now," Chapek said. "We won't limit ourselves and say no to anything. But right now, we have no such plans for that."
Chapek elucidated on Disney's streaming price strategy while answering a line of questioning from Credit Suisse managing director Doug Mitchelson. Of note, Mitchelson said many Disney customers are inured to commercials and ad breaks, coming from the company's cable offerings. While true, the benefit gained by including ads to offset a portion of monthly Disney+ streaming costs would apparently be immaterial at this stage.
The line of thinking was borne out by customer response to Disney's recent price hike from $7 a month to $8. According to Chapek, the change did little to impact subscriber numbers.
"We did launch at a very attractive price-value opening point," Chapek said. "The first price increase that you mentioned in the first 16 months happened recently, and we've seen no significantly higher churn because of that."
Disney is also in the enviable position of operating a popular streaming with a massive content catalog to which new exclusives and originals are continually added. In May, the company reported 103.6 million subscribers at the end of April, just 17 months after the service launched. Initial expectations were set at between 60 to 90 million subscribers by 2024.
Disney's announcement arrives as segment competitors introduce ad-supported models to reel in customers. For example, HBO Max in May turned to ads to cut its monthly rate by $5.
Apple does not provide an ad-supported tier of Apple TV+, though the company has been offering one-year trials to new device buyers. That period was reduced to three months this week.
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15 Comments
I appreciate that Disney+ doesn't have ANY ads. Whereas Paramount+ shows tend to have a 15 second "promo" for some other program at some point during each episode of each program I watch. And to add insult to injury, the promos are usually for shows that aren't available in my country. Apple also has begun showing "promos" about 30 seconds long at the beginning of many episodes of its shows. Although the Apple ad comes with a SKIP button. I'm going to write a macro on my Mac which monitors for that skip button and auto-presses it. That should be 5 minutes of work. I'm hopeful that I can write this macro using the built-in OCR capabilities of Maverick macOS; right now I'm using a third party product for my OCR code.
I consider promos to be ads. Therefore Apple and Paramount+ do not have truly ad-free services, in my opinion. True, it's just a single short ad per episode, but it's not ad-free.
The only thing I didn't like about Disney+ is that watching it in Safari on my iMac always had a multi-gigabyte memory leak, (which didn't happen in Firefox) and required refreshing the browser every 5 minutes to restore my memory, or just using Firefox. But switching to an M1 Mini, I haven't had that happen at all.
Ok. Now it’s time to bring Disney into the courtroom for behaving in a business like manner and wanting to drive a profit.
That’s OK because I have no interest in supporting a company who panders to communist China and who also treats their domestic employees “cast members” with such disdain. It’s really too bad because I like a lot of their content. Every time they buy up something like Marvel Comics it makes me angry. I’ll watch the movies from Netflix if and when I can get it but I will not knowingly or directly give my money to Disney.
I'm old enough to remember when the value proposition to cable TV included no advertising. I'm glad I at least have the option of paying to go ad free when suscribing to content though. However, using Apple News as an example, this option is no guarantee. There's a free, limited content tier. Pay for access to more content, but it still has some ads. PLUS constant upselling to the full version of individual publishers. There is endless upselling and ad creep. Its a mess and annoying so I just limit subscriptions to a small handful. I don't even want to see previews/promos of other content when watching someting I paid for.
Once you’ve watched all the Marvel, Pixar, Star Wars, Disney stuff you come to the realization that Disney+ actually has very limited content, like the critics of Apple TV+ always caterwaul about. Whatever floats your boat. I keep Disney+ for the grandkids since I’ve been through most of the content years ago when those movies came out.