Skip to content

Disney says its subscribers don’t mind watching ads

crystal castle with fireworks at night

An increasing number of new users are opting to subscribe to Disney Plus’ ad-supported tier, priced at $7.99 per month.

Disney Plus introduced its ad-supported plan less than a year ago, and it has quickly gained popularity among new subscribers.

Between March and September 2023, a significant milestone was achieved as 50 percent of newly signed-up users opted for the ad-supported plan, priced at $7.99 per month, instead of the pricier ad-free version.

The success of this ad-supported option is noteworthy, with Rita Ferro, Disney’s president of global advertising, revealing that 40 percent of subscribers had already chosen this tier earlier in the year.

Disney’s pricing strategy played a crucial role in this shift, as they maintained the price of the ad-supported plan while increasing the cost of the ad-free subscription from $10.99 to $13.99. This strategic move was aimed at enticing more subscribers towards the ad-supported tier.

Interestingly, Disney is capitalizing on the ad-supported model, as they earn additional revenue through advertisements displayed to users on this tier.

Kevin Lansberry, Disney’s interim chief financial officer, has observed that the ad-supported tier is continually improving the average revenue per user (ARPU), a trend also seen in Netflix’s ad-supported offering.

Disney’s plans include expanding the availability of the ad-supported tier to Canada and several European countries, including the UK, France, Germany, Italy, and more, starting from November 1st.

In the near future, Disney is expected to provide further insights into the performance of the ad-supported tier and discuss its strategies for addressing password sharing in their upcoming fourth quarter earnings report.

Leave a Reply

Your email address will not be published. Required fields are marked *