• by Wayne Friedman , Staff Writer, January 12, 2024

You can believe advertising-supported business is taking off for both Netflix and Disney+: Both are making steady business metric gains.

But the question is -- what happens when the excitement of these low-cost options gets in the crosshairs of consumers' complete monthly entertainment pinch points?

Disney+ now says 50% of all its new subscribers are headed to its ad option, according to sources -- 5.2 million subscribers as of last November.

Thirty percent of Netflix new subscribers are going to its ad option worldwide -- now at 23 million -- up from 15 million just a few months ago in November.

Go deeper if you will. 

Sources say that for Disney, this has not hurt overall monthly consumption -- that those ad-supported viewers are watching the same number of hours per month as those viewers watching ad-free Disney+.

We can only assume Netflix has some of the same results for monthly consumption.

It seems that a move to more ad-supported business is only accretive. But what remains? 

The original draw of streaming -- the advertising-free subscribers' business-- continues to be steady, with subscriber growth slowing down dramatically, but still dominating the business. In December there were 247.1 million overall subs for Netflix and 150.2 million for Disney+.

Ad-free can count on the steadily inching-up consumer price point for growth. 

It still has to yield to the vagaries of churn -- the turning-off and turning on -- a subscription service based on new content offerings and/or new seasonal episodes of popular TV series.

Overall December monthly churn numbers for streamers, according to Churnkey, are as follows: Netflix, 3.1%; Apple TV+, 6.8%; Hulu, 4.7%; and Disney+, 4.6%.

Perhaps then we need to soon start tracking the churn of just those advertising-supported subscriptions -- if any.

Ideally, those low price points for both Netflix and Disney+ -- $6.99 a month and $7.99 a month, respectively --  should keep churn issues to a minimum.

The same should go for the forthcoming ad-option for Amazon’s Prime Video.

Then again, consumers have a way of finding new easy entertainment gaps causing more disruption.