Disney+ has been providing its audience with an ad-free experience where consumers enjoy un-interrupted entrainment, a model which sets them apart from some other streamers. Disney CEO Bob Chapek Is weighing the pros and cons of implementing an advertising model at some point. Chapek explained his thoughts during a conference call with investors hinting that ads could be coming to Disney+ in the future.
"...For example, Disney+ has a lot of kids that watch it, and the taste for us to consider advertising on something like Disney+ would be completely different than it might be on a Hulu. So then again, you take that individual, no one size fits all type approach that we are looking at across the world. And you say where do we have that opportunity? Where do we not have that opportunity? And then how does that change over time as we look at combining things or keeping things separate à la carte? And so, all this is malleable. Again, it's soft clay right now. And we are very pleased with what we are seeing with addressable advertising on Hulu."
Obviously, the major hurtle for the streamer would be to secure age-appropriate and engaging ad content to allow both the streamer and the advertisers to benefit. With the restrictions in place for advertising geared towards children and the programming, they might find it a challenge to secure ad clients for the family-friendly platform. It will also further complicate the merging of sister streamers Hulu and ESPN+ which, at this point do not have the same limitations when it comes to advertising.
"... I would say that, does that lead us to think big thoughts about what could happen in other markets across the world? Certainly, it does. But for right now, again, really happy with sort of the à la carte mode that we have with this bundling opportunity and keeping things the way, they are, but that doesn't say that in the future, we might not look at different opportunities for an increased level of addressable advertising across our platforms."
Disney has a current business model of profits gained by consumer subscriptions, but as time goes on, with other platforms proving to Disney+ that there is a lot of money left on the table, the streamer could be enticed to use those crunched numbers and jump into the ad-implemented game.
There doesn't seem to be a huge leap in logic that a mega-corporation like Disney+, who have been creating entertainment for a family-friendly audiences for close to a century, would be the ones to know exactly who would be interested in reaching one of the fastest-growing consumer demo. Even if they initially just padded their advertising with the multitude of products spawned from their nearly limitless catalogue, toys, cruises, theme parks, it seems to be a clear win. I'm sure other companies of that ilk would love to woo the younger viewers with their wares. But, as it stands now, Disney+ is sticking with their current model. Enjoy it while it lasts!