Disney+ Launches Cheaper Plan With Ads, Is Its Streaming Market Getting Worse?

Andi C., Tech Times 08 December 2022, 04:12 pm

A cheaper, ad-supported Disney+ finally releases to its new list of plans.

As of Dec. 8, CNN reports that Disney's ad-free tier now costs $10.99 per month, an increase of $3 from its initial price. However, a cheaper plan is now available if you are looking to save a few bucks and do not mind watching with ads.

The Disney+ service now offers three packages with its sibling platforms, Hulu and ESPN+, one of which includes the new Disney+ Basic subscription and the ad-supported tier of Hulu for just $9.99 per month.

Considering that "Hulu with Ads" alone costs $7.99 per month, that amounts to sizable savings. For $12.99 a month, another tier combines all three services with advertisements.

Disney+ Launches 'Basic with Ads' Plan

Following the price update, Disney+ now has a new tier with ads that costs $7.99 per month called Basic with Ads.

GroupWatch, SharePlay, and Dolby Atmos are additional features that are not initially included in the Disney+ Basic package. Despite not knowing the precise date, a Disney official told TechCrunch that the firm hopes to support this in the future.

According to Tech Crunch, commercials will last from 15 to 30 or up to 45 seconds. Disney+ is restricting the overall amount of advertising to an average of four minutes each hour, as we previously reported. Fortunately, preschool programming will reportedly have no ads.

Additionally, Bloomberg reports that Disney is implementing rules regarding the type of ads that will show up on the streaming platform, namely, no politics, alcohol, or anything pertaining to its streaming competitor Netflix.

Is Streaming Advertising Getting Worse?

Considering the recent decline in the advertising market as seen with networks announcing layoffs such as AMC Networks Inc., Warner Bros Discovery, and more, Disney Media's president of advertising Rita Ferro announces that they remain unfazed despite the industry struggles.

"There's no question that the marketplace is challenged, and there's no question there are more challenging times to come," Ferro said. "But we have not necessarily seen the slowdown that we have seen in the marketplace."

Bloomberg reports that Disney shares fell by 13% on Nov. 9, the worst daily drop since 2001, and were down 41% this year. However, The cost of the now expensive plan without commercials is rising by $3 to $11 per month with the launch of Disney+, which is supported by advertisements.

The company's top objective is turning around Disney's direct-to-consumer business, which lost $1.5 billion in the most recent quarter due to costs associated with Disney+.

Disney has around 236 million customers as of the end of the most recent quarter across all of its online TV services, including Hulu and ESPN+. At the time, Chapek claimed that the direct-to-consumer business' losses had peaked; Disney anticipates that this sector will turn a profit in 2024.