Premium streaming channel Disney+ confirmed the long speculation that it would be expanding its consumer offering with an ad-supported subscription tier.

The company revealed the plan to add a lower-cost ad-supported tier will begin in the United States later this year, before rolling out to international markets in 2023.

“Expanding access to Disney+ to a broader audience at a lower price point is a win for everyone – consumers, advertisers, and our storytellers,” stated Kareem Daniel, Disney Media and Entertainment Distribution chairman. “More consumers will be able to access our amazing content. Advertisers will be able to reach a wider audience, and our storytellers will be able to share their incredible work with more fans and families.”

The move comes as Disney+ has continues to garner more and more paid subscribers, particular in overseas markets, but that pace was slowing in the United States, where the service first launched in 2019.

In its Q4-2021 financial, the parent Walt Disney Co., reported SVoD streaming subscriptions across its portfolio totaled 196.4 million, including 11.8 million Disney+ subscribers added in the fourth quarter alone.

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As of Jan. 1, 2022, the company reported 129.8 million total paid international subscribers to both its Disney+ and Hotstar services, up 37% from the previous year.

The decision to add a free tier was believed to be the next step toward the company’s stated goal of achieving 230 million to 260 million Disney+ subscribers by its 2024 fiscal year.

“Since its launch, advertisers have been clamouring for the opportunity to be part of Disney+ and not just because there’s a growing demand for more streaming inventory,” said Rita Ferro, Disney Media and Entertainment Distribution advertising President. “Disney+ with advertising will offer marketers the most premium environment in streaming with our most beloved brands, Disney, Pixar, Star Wars, Marvel and National Geographic. I can’t wait to share more with advertisers at the Upfront.”

The company’s upfront presentation will be take place in May.

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By Greg Tarr

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