Disney recently confirmed that Disney+ will show ads to subscribers in a deal to give the company access to specific content currently licensed to other streaming services. Disney began making plans for its streaming service several years ago, but it wasn't until this year that it started unveiling its plans for the kind of content the service would offer.
With Disney owning the rights to Star Wars, Marvel and Fox properties, the company promised that its streaming service would give subscribers access to a boatload of content, including 300 movies and 7,000 television episodes at launch. Disney+ will also be the exclusive home for new Marvel and Star Wars series, including the highly anticipated The Mandalorian. And like Netflix, Disney promised that its service, which subscribers can choose to bundle with Hulu and ESPN+, would be entirely free of ads.
Disney has since backtracked on its ad-free promise. The Verge reports that Disney+ subscribers will see ads for Starz when signing in. There's a good reason for this: Starz owns the streaming rights to some of Disney's movies, including Star Wars: The Force Awakens. Disney agreed to run ads for Starz on Disney+ in a revised licensing deal that would allow Disney+ to have The Force Awakens available at launch. However, the ad is not an intrusive one, it is merely a display advertisement that will appear on the Android app and in browsers on the Disney+ and ESPN+ login pages. Disney+ will not show any ads within the service itself.
Disney continues to try and rein in some of the content it has licensed to other streaming services, including Starz and Netflix. Because of existing licensing deals, Disney+ will even lose some movies in 2020 when they return to Netflix, most notably films released between 2016-2018. Although subscribers can download movies from Disney+ and watch them even after they leave the service, those films will remain absent from the streaming library. Disney and Netflix have a long history of sharing content, but the two companies will become direct competitors after the Disney+ launch.
Disney's deal with Starz is good news, though, since it could mean more movies on the Disney+ platform for the small price of seeing an ad when logging into the app. Likely, most subscribers won't even mind the mild intrusion. However, don't expect to see a Netflix ad on the Disney+ login screen. Disney has already gone to great lengths to get a competitive edge over its rival by banning ads for Netflix on its networks. The company will probably not broker such a deal with its biggest competitor.
Source: The Verge