In a bid to push profit margins, Disney+ is reportedly considering a major revamp that includes introducing ad-supported channels alongside its existing ad-free content.
According to a report by The Information, the channels would function similarly to free-ad-supported streaming services (FAST) like Pluto or Tubi, offering continuous programming themed around popular categories like Marvel or Star Wars.
The move aligns with Disney’s strategy of keeping users engaged within the Disney+ app. This way, viewers can seamlessly switch between content libraries without leaving the Disney+ platform.
Disney+, launched in 2019 by CEO Bob Iger, saw explosive growth during the COVID-19 lockdowns.
With theme parks shut and families confined at home, Disney+’s vast library of 8,000 hours of content of movies, shows, and more became the only go to option for viewers. Keeping up with the emerging trend and demand, the company also aggressively invested in the service and expanded it expecting sustained demand.
However, with the pandemic receding and people beginning to go back to their normal lives outside the confines of their homes, everything from watch time to the subscriber growth stagnated.
The platform has clocked an operating loss of around $11.4 billion since loss, casting a shadow on its not just the platforms viability but also shareholders who are suffering a declining stock price.
This pressurised the company for a complete turnaround and led to the ousting of Iger’s successor, Bob Chapek, and Iger’s return as CEO.
He is now tasked with driving Disney+ towards profitability, implementing cost-cutting measures like layoffs and streamlining the content library.