A look into Disney+ subscriber data from Antenna research firm shows nearly 60% of new subscribers opt for the ad-supported plan.
The majority of new Disney+ subscribers gravitate towards the cheaper ad-supported plan over the ad-free tiers, according to Insider Intelligence. Almost 60% of new subscriptions choose the ad-supported option, the platform’s most affordable plan.
While platforms like Netflix, Hulu, and Disney+ offer ad-supported streaming for less per month than the ad-free versions, it’s not cheaper with every service. On January 29, Prime Video will launch advertisements across all plans, and users will need to pay an additional fee to remove them. The move could generate up to $5 billion in annual revenue for Amazon, with video ads contributing $3 billion and $1.8 billion from Prime members paying extra to avoid advertisements.
Streaming subscribers are scaling back on paid streaming services. Antenna shows cancellations rose 6.3% last November, up from 5.1% in 2022. A quarter of streamers canceled at least three major services in the last two years, up from 15% two years ago. In 2024, 21% of streaming subscribers are expected to reduce the number of accounts they hold, and 30% of cable TV users will cut the cord.
Streaming is a saturated market, and it’s become more difficult for platforms to entice new subscribers to sign up. Companies have shuffled around their pricing tiers and selections. Several, including Netflix, Disney+, and Max, have increased the cost of their ad-free plans while the ad-supported options remain relatively the same price to encourage new members to sign up for less money, while streamers drive up revenue through hundreds of ads featured on their platforms.
Netflix’s ad-supported tier reached 23 million active monthly users this month, a big jump from 15 million in November. The streamer said 30% of new subscribers chose this plan, which costs $6.99 a month compared to the $15.49 ad-free plan.The move marks a shift in tech and streaming services as more companies explore ways to drive subscriptions and increase revenue streams. Companies are pairing their services with streaming platforms to add value to their packages through discounts and other perks. Verizon bundled with Netflix and Max to encourage longer subscription commitments, and T-Mobile includes Hulu on its Go5G Next Plan as well as Netflix and Apple TV+.