Disney+ Aggressively Discounting Advertising Rates
https://whatsondisneyplus.com/disney-aggressively-discounting-advertising-rates/
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Hi it's Roger here from what's on Disney Plus. Come on quick news update for you guys on how Disney Plus is aggressively trying to get into profitability before the end of 2024. But before we go any further make sure you do hit that subscribe button to keep up with the latest Disney Plus news. So way back in 2019 Disney was set out its plans for Disney Plus and one of those plans was that they were going to be hitting profitability by 2024. Well we are nearly there and we have seen some major changes within Disney Plus over that time. They started off going all act really low prices trying to get as many people signed up as possible. It worked so many people did within a year Disney completely changed its plans for how many subscribers it was going to have by 2024. It was like over 200 plus million globally. They started really investing in original content. They were going all in on trying to make sure that it was going to get there. But they gave themselves like a five year leeway. Well then obviously during the pandemic it all increased but then Wall Street kind of changed its mind and kind of looked and went look just getting subscribers is great but if you're not making any money from them that's no good. So the flip happened and all the streaming services and studios had to start focusing on profitability and we saw a massive change within Disney Plus. We saw a massive reduction in the amount of originals they're creating. There's no point in denying that there's a lot less out there each and every day and now we saw a removal of 100 plus originals that were written off as almost like a tax loss and that saved them a couple of billion. We're seeing them merging in with like Hulu, we're seeing big changes, lots of things going on and a general reduction in the amount of content being created. One of the other major things that was added was the ad supported tier. So it's rolled out in the United States back at the end of 2022. It's been rolling now for over probably about 18 months to roll out in other regions as well and it's probably going to continue to expand for example like in Latin America later this year. But the advertising world right now is not great. It's not particularly good in terms of how much money people are getting. So what this refers to is something called CPM which makes you refer to how much money you make for every thousand people. Now this impacts pretty much everyone that relies on advertising. So obviously Disney Plus needs it. You've also got all the other streaming services require it even here on YouTube. So this is just hitting me as just as bad as hitting Disney. So yes if you decide to become a member that would be a big help. So we're not completely reliant on it but nevertheless. So Disney is trying to get into profitability by the end of the year. Now what that means is that they kind of nearly got there in the last quarter. They have said that they won't make it this next quarter that's coming up. Well they want to do it by the end of the next one. So one of the big things they're doing looks like they are really pushing their advertising because Variety is saying that they've been reducing their ad revenue sort of how much they're allowing it to be sold for by around about 10% and this is seen as very aggressive. All the other studios are not apparently happy with this. They're upset that they're kind of having to lower their prices because Disney is going in so heavy with the discounts to make sure they get enough people to sign up for it. Now the thing I think as well with the advertising is it's not just Disney Plus it then goes obviously on Hulu and the introduction of Hulu on Disney Plus also brings in more advertising into Disney Plus anyway but they really want to make sure that they've got that advertising money set in and it's moving good. Now there are good things obviously and there are bad things for this. So for Disney it does mean you know they are getting in more money. They're trying to make sure they get more advertising and that is good for them. They need to do so. It's also establishing as well you know that Disney Plus is somewhere for people to advertise which is a certain audience and I suspect we're going to be seeing a massive boost in the amount of people that they're signing out for the ad support tier because it's the cheapest version. All right that's if they can do any promotions that's where they first go to now. They're not giving them out on like the ad free version. They want you to get that one. We're seeing it bundled in with telephone providers and cable television and yeah they are out putting the price up. They're just continuing to do so and I wouldn't even be surprised if there were some price cuts or some price just price freezes on those ad support tiers for a while get. They want you on that and I think eventually when they merge in Hulu once they kind of get the deal sorted with Comcast that'll bring in even more ad supported members. So you can remember with Hulu like 90% of their subscribers are actually on the ad supported tier. So I think they want to get that with Disney Plus but nevertheless so there are a lot of advantages they want to get there. Now there is obviously some disadvantages to them doing this. First off it is setting up the idea that Disney Plus is maybe cheaper and it's not good long term of you know people are going to be you know the advertisers are going to be coming back next year out looking to see you know if they can get something the same and it can be year on year of them then trying to put the prices up which is going to be an issue. Obviously it's causing problems within the industry of all of the streaming platforms are all then having to reduce their advertising rates less money coming in which means less money for new content which is going to obviously impact on us as well and it's just not going to affect probably as well low advertisement costs mean then we're probably going to see more adverts that's the thing at the minute Disney Plus adverts are a little bit more on the low end compared to Hulu but yeah I think we're probably going to see more ads kind of creeping in over time you know so you're trying to make more money so it is going to impact us on that point not necessarily saying it's going to happen now but let's be honest we know what it's like with advertising it's like when you start at the cinema you just sit there and you just have maybe one advert now it's like 25 minutes of it and you're like why have I sat through all of this but nevertheless yeah so advertising is very important for Disney Plus it is something that is vital and we are really seeing a shift now within television and streaming that advertising is part of it the days of having cheap ad-free television they're pretty much over that's not happening much more and we're just going to continue to see those ad-free offerings get more and more expensive as they want more and more people on it and that's how they're going to click you in we're seeing the rise of apps like Pluto and 2B because people just want to watch TV for free they want to pay for it and that's why these lower price tiers are so popular and why you know so many more people signing up are going to do so on the ad team I know if I'm signing up for one now I'm going to go on ad-free or sorry I'll add for a bit see how it is see how we get on with it but yeah so this is this is big news really and it is going to have a longer impact but I don't know what do you think you think this is a good thing do you think it's a bad thing I love to know your thoughtsness I know a lot of people when it comes to advert they just go straight to negative I don't want to I don't want to see it's it's all bad advertising is awful and it's like the simple truth is is if there's no advertising it's not going to make the money and therefore we are not going to get that content eventually it's we're going to see I drop them but let us know what you think go check us out over at what's on at disneyplus.com like follow and subscribe and I'll see you guys soon later bye! you [BLANK_AUDIO] [BLANK_AUDIO]
