Here's Why Disney Isn't Worrying Too Much About the Rise of Free, Ad-Supported Streaming
Much of the television industry's recent narrative has focused on the rise of ad-supported video at the expense of ad-free subscription services like Netflix (NASDAQ: NFLX). Market research outfit Kantar reports Comcast's (NASDAQ: CMCSA) Peacock -- which is offered in a free tier -- secured more new subscribers last quarter than any other platform. Streaming service aggregator app developer ReelGood indicates the total number of subscription-based streams fell from the second quarter's 52.3% to 47.5% in the third quarter, while the number of ad-supported streams grew from 25% to 30.8% during the quarter in question.
This trend favors free-to-watch video services and seemingly works against Walt Disney (NYSE: DIS), which not only offers an ad-free, subscription-based Disney+ but also sells for-pay streaming service Hulu. In an on-demand video world where value is an increasingly important purchase factor, it's tough to beat a price of free -- even if that means viewers have to tolerate the occasional TV commercial.
But if you think Walt Disney isn't positioned for the next chapter of the ad-supported video, think again. It's already the biggest of the ad-supported video services, even if not always categorized as one.
Source Fool.com
