Disney+ looks to reverse streaming losses by expanding ad-supported plan to new regions

By 08/11/2023
Disney+ looks to reverse streaming losses by expanding ad-supported plan to new regions

In less than a year, ad-supported subscription tiers have gone from an industry-wide experiment to a hot business model in streaming. Now, Disney+ is looking to build on promising early results by bringing its ad-supported subscription option to Canada and select regions in Europe.

The ad-supported Disney+ plan offers financial savings compared to the streaming service’s ad-free choices. In Canada, where ad-supported Disney+ will start at $7.99 per month, the ad-free version of the subscription will experience a $3 price hike, reaching a minimum of $11.99 per month. In Europe, there will be a €3 price difference between those two plans.

According to Variety, ad-supported Disney+ will reach Europe in November. It will be available in the United Kingdom, France, Germany, Switzerland, Italy, Spain, Norway, Sweden, and Denmark.

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Disney+ first launched its ad-supported subscription in the U.S. in December 2022. Though initial reports suggested that the ad tier was struggling to catch on, it soon picked up momentum. In July 2023, a survey found that nearly 20% of Disney+ customers were on the ad-supported plan. Among new subscribers, approximately 40% choose to save money by including ads.

If Disney+ customers have indeed expressed a preference for ad-supported streaming, the Mouse House would be smart to meet their wishes. In its most recent earnings report, Disney revealed that its namesake streaming service lost 11.7 million subscribers over three months. A cheaper option could regain some of that traffic.

It’s interesting to compare the Disney+ experiments in ad-supported streaming to those conducted by Netflix. The leading subscription service fast-tracked its ad-supported tier to beat the competing Disney+ product to market. Initially, that decision caused some consternation among advertisers, but Netflix’s ad-supported plan — currently available in a dozen countries across five continents — now has more than five million users. It’s become so popular that Netflix is limiting its basic ad-free plan, providing more incentives for ad tier signups.

Disney+ is taking the opposite approach. As it expands ad-supported streaming, it’s also launching new options for customers who prefer an ad-free experience. A new bundle will combine Disney+ and Hulu with no ads for $19.99 per month. It will become available in the U.S. in September.

“The strong momentum of our ad-supported plans in the U.S. demonstrates the importance of providing consumers with choice, flexibility, and value,” said Disney Entertainment Direct-to-Consumer President Joe Earley in a statement. “We are excited to expand that offering in more markets across the globe, including in Europe and Canada, and to launch a new premium duo bundle of ad-free Disney+ and Hulu this Fall, as we take steps toward making extensive Hulu content available via Disney+ later this year for Bundle subscribers.”

Disney+ includes access to content from Disney, Pixar, Marvel, Star Wars, and National Geographic.

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