OTT platforms have grown in extreme popularity since the pandemic messed up our daily lives. The major source of revenue for these OTT apps is the advertisements that they run on their platforms. And many major streamers like Hulu, HBO Max, or Sling TV run advertisements in almost all their offerings.
However, there is one company that says that advertisements are not that important to it. Recently, Disney’s chief said that the company’s marquee service wouldn’t be adding ads to its service anytime soon.
Disney head Bob Chapek stated at the Credit Suisse 23rd Annual Communications Conference on Tuesday that introducing an ad-supported entry tier at some point down the line is not entirely off the table; however, the company has not yet kept the idea on the table.
“We’re always reevaluating how we go to market across the world, but we’ve got no such plans now to do that. We’re happy with the models that we’ve got right now. We won’t limit ourselves and say no to anything. But right now, we have no such plans for that.”
Many Disney subscribers already experience an ad service through the Disney Channel, and ad-supported streaming offered at a discount is popular among many major services. However, the company recently went for a hike in the subscriber’s fee, from $7 per month to $8. But the Disney Chief states that the price hike did not affect the company’s subscription numbers.
“We did launch at a very attractive price-value opening point. The first price increase that you mentioned in the first 16 months happened recently, and we’ve seen no significantly higher churn because of that.”
Disney Plus will certainly see subscription increases over time, and many still argue that the price increase is justifiable with the contents it provides.