Disney explores free ad-supported channels to boost streaming growth
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Disney is exploring the launch of free, ad-supported streaming (FAST) channels, chief executive Josh D'Amaro told analysts on the company's latest earnings call, as he set out streaming and the parks and experiences division as the two pillars driving the group's future growth. D'Amaro said free channels could extend Disney's reach among price-sensitive viewers, boost advertising revenue and act as a "funnel" drawing new customers towards paid services such as Disney+ and Hulu. He also pushed back on the idea that Disney should rely more heavily on licensing its content to other broadcasters, arguing that abandoning the direct-to-consumer subscription model would weaken the company's strategic and financial position.
D'Amaro told investors Disney is "fairly well sold" on advertising inventory compared with rivals, meaning additional FAST channel slots could accelerate ad revenue growth, though he stopped short of confirming a formal launch, calling it simply something the company is "considering". He said Disney+ remained a "global touchpoint" that complements data gathered through its theme parks and cruise ships, and pointed to enhancements planned for the service next spring, including games, merchandise and greater personalisation for subscribers. He also defended the scale of Disney's direct-to-consumer investment, arguing that a large global streaming user base is strategically necessary to sustain long-term growth.
- Disney considering free ad-supported (FAST) streaming channels
- CEO D'Amaro: free channels could fund and feed Disney+ growth
- No formal launch confirmed; Disney+ upgrades planned for next spring
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Disney's boss, Josh D'Amaro, has flagged the possibility of adding free, advert-funded streaming channels alongside its existing paid services. These would sit next to subscription platforms such as Disney+ and Hulu, giving viewers a no-cost option supported by adverts rather than a monthly fee. D'Amaro took over as chief executive recently and used a call with investors to set out his priorities, chiefly streaming and Disney's theme parks and holiday business.
The idea fits into a wider debate in the entertainment industry about how best to make money from television and film content now that traditional broadcasting has declined. Companies can either license their shows and films to other broadcasters and streaming services for a fee, or keep control by streaming directly to viewers themselves, sometimes for free with adverts, sometimes via paid subscription. Disney has been building up its own direct-to-consumer streaming business for several years, investing heavily in original content to attract and keep subscribers.
This matters because it signals how Disney, one of the world's largest media and entertainment companies, intends to keep growing as competition for viewers' attention and advertising money increases. Decisions about free versus paid streaming affect not just Disney's revenue but also how consumers access its films, television shows and sport in future.
Both sides, in good faith
The strongest fair case each way — we don't pick a winner.
The case for
Advocates of Disney's direct-to-consumer strategy, including new free ad-supported channels, argue that owning the customer relationship is invaluable: streaming data, when combined with insights from theme parks and cruise ships, allows for a level of personalisation and cross-selling no licensing deal could match. Free FAST channels widen Disney's reach to price-sensitive households who might otherwise never encounter its content, acting as a low-cost funnel into paid subscriptions while soaking up advertising demand the company says it is already well placed to capture. On this view, retaining control over pricing, distribution and brand experience is essential to Disney's long-term competitiveness as viewing habits continue shifting decisively towards streaming.
The case against
Sceptics of an expanded direct-to-consumer push make a reasonable case that Disney's more than $24 billion annual content spend already strains profitability, and that leaning further into free, ad-funded channels risks cannibalising paid Disney+ and Hulu subscribers rather than genuinely growing the audience. Licensing content to established broadcasters, by contrast, offers steadier, lower-risk revenue without the heavy technology, marketing and customer-acquisition costs of running competitive streaming platforms. They would also note that advertising markets are cyclical and fiercely contested, so adding inventory when the company is already 'fairly well sold' may do less to strengthen the business than a more capital-disciplined, licensing-led approach focused on proven earnings rather than long-term strategic bets.
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Originally published by Variety as “Disney Looking to Launch Free Streaming Channels as CEO Josh D’Amaro Doubles Down on the Streaming Biz”.