Disney Plus Adding Cheaper Ad-Supported Tier As Consumers Balk At Streaming Costs

Christian Hetrick

Christian Hetrick is dot.LA's Entertainment Tech Reporter. He was formerly a business reporter for the Philadelphia Inquirer and reported on New Jersey politics for the Observer and the Press of Atlantic City.

Disney Plus Adding Cheaper Ad-Supported Tier As Consumers Balk At Streaming Costs
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Coming soon to Disney Plus: commercials.

On Friday, Disney announced that it will offer a cheaper, ad-supported tier of its flagship streaming service, joining other major streaming platforms in giving subscribers an ad-supported option. The Burbank-based media giant did not disclose how much the less expensive tier will cost—Disney Plus is currently priced at $7.99 per month—but said it will roll out in the U.S. later this year, with plans to launch it globally in 2023.


“Expanding access to Disney Plus to a broader audience at a lower price point is a win for everyone—consumers, advertisers and our storytellers,” Kareem Daniel, Disney’s chairman of media and entertainment distribution, said in a statement.

The move isn’t surprising given the growing consumer demand for cheaper streaming options. Subscription analytics firm Antenna released data last week showing that consumers increasingly opted for less expensive, ad-supported subscriptions in 2021 than in previous years. Ad-supported sign-ups grew more than 117% year-over-year, from 19.4 million in 2020 to 42.2 million last year, according to Antenna.

At the same time, a recent survey by tech consultancy Concepts Rise indicated that many users are likely to ditch a streaming service this year because of the cost.

Disney views the ad-supported offering as a way to reach its long-term target of 230 million to 260 million Disney Plus subscribers by its 2024 fiscal year. The streaming service had 129.8 million subscribers as of Jan. 1.

But some analysts are already questioning whether Disney has made the right call. Analysts at media research firm LightShed Partners noted that inserting ads can lower users’ streaming consumption, adding that Disney’s addition of an ad-supported tier “feels premature.”

“The key now is driving usage so that Disney can capture more consumer time spent per household per day,” LightShed analysts Rich Greenfield, Brandon Ross and Mark Kelley wrote on Friday. “Lowering price and jamming in ads does not feel like the answer to driving usage—if anything it feels like it will have the opposite effect.”

Disney joins the likes of HBO Max, Paramount Plus and NBCUniversal’s Peacock in offering an ad-supported option. The company also offers a bundle that packages Disney Plus with its Hulu and ESPN Plus streaming services. Rather than releasing entire seasons of content at once, Disney Plus has joined other streaming platforms in opting to drop one episode at a time on a weekly basis—a move partly designed to keep users, who may otherwise binge-watch a show and then cancel their subscriptions, on the platform for a longer period.

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Genies Wants To Help Creators Build ‘Avatar Ecosystems’

Christian Hetrick

Christian Hetrick is dot.LA's Entertainment Tech Reporter. He was formerly a business reporter for the Philadelphia Inquirer and reported on New Jersey politics for the Observer and the Press of Atlantic City.

Genies Wants To Help Creators Build ‘Avatar Ecosystems’

When avatar startup Genies raised $150 million in April, the company released an unusual message to the public: “Farewell.”

The Marina del Rey-based unicorn, which makes cartoon-like avatars for celebrities and aims to “build an avatar for every single person on Earth,” didn’t go under. Rather, Genies announced it would stay quiet for a while to focus on building avatar-creation products.

Genies representatives told dot.LA that the firm is now seeking more creators to try its creation tools for 3D avatars, digital fashion items and virtual experiences. On Thursday, the startup launched a three-week program called DIY Collective, which will mentor and financially support up-and-coming creatives.

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Here's What To Expect At LA Tech Week

Christian Hetrick

Christian Hetrick is dot.LA's Entertainment Tech Reporter. He was formerly a business reporter for the Philadelphia Inquirer and reported on New Jersey politics for the Observer and the Press of Atlantic City.

Here's What To Expect At LA Tech Week

LA Tech Week—a weeklong showcase of the region’s growing startup ecosystem—is coming this August.

The seven-day series of events, from Aug. 15 through Aug. 21, is a chance for the Los Angeles startup community to network, share insights and pitch themselves to investors. It comes a year after hundreds of people gathered for a similar event that allowed the L.A. tech community—often in the shadow of Silicon Valley—to flex its muscles.

From fireside chats with prominent founders to a panel on aerospace, here are some highlights from the roughly 30 events happening during LA Tech Week, including one hosted by dot.LA.

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PCH Driven: Director Jason Wise Talks Wine, Documentaries, and His New Indie Streaming Service SOMMTV

Jamie Williams
­Jamie Williams is the host of the “PCH Driven” podcast, a show about Southern California entrepreneurs, innovators and its driven leaders on their road to success. The series celebrates and reveals the wonders of the human spirit and explores the motivations behind what drives us.
Jason Wise holding wine glass
Image courtesy of Jason Wise

Jason Wise may still consider himself a little kid, but the 33-year-old filmmaker is building an IMDB page that rivals colleagues twice his age.

As the director behind SOMM, SOMM2, SOMM3, and the upcoming SOMM4, Wise has made a career producing award-winning documentary films that peer deep into the wine industry in Southern California and around the world.

On this episode of the PCH Driven podcast, he talks about life growing up in Cleveland as a horrible student, filmmaking, Los Angeles and his latest entrepreneurial endeavor: A streaming service called SOMMTV that features–what else?–documentaries about wine.

The conversation covers some serious ground, but the themes of wine and film work to anchor the discussion, and Wise dispenses bits of sage filmmaking advice.

“With a documentary you can just start filming right now,” he says. “That’s how SOMM came about. I got tossed into that world during the frustration of trying to make a different film, and I just started filming it, because no one could stop me because I was paying for it myself. That’s the thing with docs,” or “The good thing about SOMM is that you can explain it in one sentence: ‘The hardest test in the world is about wine, and you’ve never heard about it.’”

…Or at least maybe you hadn’t before he made his first film. Now with three SOMM documentaries under his belt, Wise is nearing completion of “SOMM4: Cup of Salvation,” which examines the history of wine’s relationship with religion. Wise says it’s “a wild film,” that spans multiple countries, the Vatican and even an active warzone. As he puts it, the idea is to show that “wine is about every subject,” rather than “every subject is about wine.”

For Wise, the transition to launching his own streaming service came out of his frustration with existing platforms holding too much power over the value of the content he produces.

“Do we want Netflix to tell us what our projects are worth or do we want the audience to do that?” he asks.

But unlike giants in the space, SOMMTV has adopted a gradual approach of just adding small bits of content as they develop. Without the need to license 500 or 1,000 hours of programming, Wise has been able to basically bootstrap SOMMTV and provide short form content and other more experimental offerings that typically get passed over by the Hulus and Disneys of the world.

So far, he says, the experiment is working, and now Wise is looking to raise some serious capital to keep up with the voracious appetites of his subscribers.

“Send those VCs my way,” Wise jokes.

Subscribe to PCH Driven on Apple, Stitcher, Spotify, iHeart, Google or wherever you get your podcasts.

dot.LA reporter David Shultz contributed to this report.

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