Disney+ to Introduce an Ad-Supported Subscription Offering in Late 2022

Rhea-AI Summary

Disney+ is expanding its service by introducing an ad-supported subscription model alongside its existing ad-free option, set to launch in the U.S. in late 2022, with international expansion planned for 2023. This move aims to enhance accessibility and affordability for consumers while enabling advertisers to reach a wider audience.

The ad-supported tier is critical to Disney's goal of achieving 230-260 million subscribers by FY24. Disney leverages its strong brand portfolio, including Pixar, Marvel, and Star Wars, to attract advertisers seeking premium streaming environments.

Positive

• Introduction of an ad-supported subscription model will enhance accessibility and attract a broader audience.
• Expected to significantly contribute to reaching the target of 230-260 million Disney+ subscribers by FY24.
• Positioning Disney+ to leverage its strong brand portfolio in advertising, which could result in increased revenue.

Negative

• None.

Will Provide Greater Accessibility to a Broader Audience and Give Consumers More Choice and Control

NEW YORK & BURBANK, Calif.--(BUSINESS WIRE)-- In a first for Disney’s premier direct-to-consumer streaming service, Disney+ will expand its offerings for consumers by introducing an ad-supported subscription in addition to its option without ads, beginning in the U.S. in late 2022, with plans to expand internationally in 2023.

“Expanding access to Disney+ to a broader audience at a lower price point is a win for everyone - consumers, advertisers, and our storytellers,” said Kareem Daniel, Chairman, Disney Media and Entertainment Distribution. “More consumers will be able to access our amazing content. Advertisers will be able to reach a wider audience, and our storytellers will be able to share their incredible work with more fans and families.”

Disney leads the market with quality and premium ad experiences. It is home to the industry’s premier ad-supported streaming services, including Hulu, a pioneer and leader among all ad-supported video-on-demand subscription services, and ESPN+, which continues to pave the way for direct-to-consumer sports programming and live events. This type of innovation, driven by advertising that is contextually relevant to viewers, will soon extend to Disney+.

“Since its launch, advertisers have been clamoring for the opportunity to be part of Disney+ and not just because there’s a growing demand for more streaming inventory,” said Rita Ferro, President, Advertising, Disney Media and Entertainment Distribution. “Disney+ with advertising will offer marketers the most premium environment in streaming with our most beloved brands, Disney, Pixar, Star Wars, Marvel and National Geographic. I can’t wait to share more with advertisers at the Upfront.”

The ad-supported offering is viewed as a building block in the Company’s path to achieving its long-term target of 230-260 million Disney+ subscribers by FY24.

More details, including launch date and pricing, will be announced at a later date.

About Disney+

Disney+ is the dedicated streaming home for movies and shows from Disney, Pixar, Marvel, Star Wars, and National Geographic, as well as the new general entertainment content brand in select International markets, Star. As part of Disney’s Media & Entertainment Distribution segment, Disney+ is available on most internet-connected devices and offers commercial-free programming with a variety of original feature-length films, documentaries, live-action and animated series, and short-form content. Alongside unprecedented access to Disney’s incredible library of film and television entertainment, the service is also the exclusive streaming home for the latest releases from The Walt Disney Studios. Disney+ is available as a standalone streaming service or as part of The Disney Bundle that gives subscribers access to Disney+, Hulu, and ESPN+. For more, visit disneyplus.com, or find the Disney+ app on most mobile and connected TV devices.

Forward-Looking Statements

Certain statements in this communication may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding our business plans, future consumer and advertiser demand and reach and other statements that are not historical in nature. These statements are made on the basis of management’s views and assumptions regarding future events as of the time the statements are made. Management does not undertake any obligation to update these statements.

Actual results may differ materially from those expressed or implied. Such differences may result from actions taken by the Company, including business decisions, as well as from developments beyond the Company’s control, including: changes or further changes in domestic and global economic conditions; competitive conditions; consumer preferences or demand; legal or regulatory requirements; the advertising market; and timing, availability and performance of content.

Additional factors are set forth in the Company’s Annual Report on Form 10-K for the year ended October 2, 2021 under Item 1A, “Risk Factors,” Item 7, “Management’s Discussion and Analysis,” Item 1, “Business,” and subsequent filings with the Securities and Exchange Commission.

View source version on businesswire.com: https://www.businesswire.com/news/home/20220304005303/en/

Media Contacts

Disney Media & Entertainment Distribution

Heather Hust Rivera

heather.hust.rivera@disney.com

Disney+

Jessica Casano-Antonellis

jessica.casano@disney.com

Disney Ad Sales

Tori Fernandes

tori.fernandes@disney.com

Source: Disney+

FAQ

What is Disney's new subscription model for Disney+?

Disney is introducing an ad-supported subscription model for Disney+, in addition to its ad-free service.

When will the ad-supported Disney+ subscription launch?

The ad-supported subscription for Disney+ is set to launch in the U.S. in late 2022.

How many subscribers does Disney+ aim to have by FY24?

Disney+ aims to achieve between 230-260 million subscribers by FY24.

What brands are included in Disney's advertising strategy for Disney+?

Disney's advertising strategy for Disney+ includes its popular brands like Disney, Pixar, Star Wars, Marvel, and National Geographic.

Will the ad-supported Disney+ service be available internationally?

Yes, Disney plans to expand the ad-supported Disney+ subscription internationally in 2023.