Despite promises of new and improved TV and movie viewing experiences, streaming services remain focused on growing revenue and app usage. As a result of that focus, streaming companies are mimicking the industry they sought to replace—cable.
On Monday, The Information reported that Disney plans to add "a series" of channels to the Disney+ app. Those channels would still be streamed and require a Disney+ subscription to access. But they would work very much like traditional TV channels, featuring set programming that runs 24/7 with commercials. Disney hasn't commented on the report.
Disney is exploring adding channels to Disney+ with "programming in specific genres, including either Star Wars or Marvel-branded shows," The Information said, citing anonymous "people involved in the planning." It's unknown when the Disney+ channels are expected to launch.
The report comes as streaming services continue trying to find ways to capitalize off cable companies' customer base. NBCUniversal's Peacock streaming service already offers subscribers over 50 always-on live channels. Hulu and Paramount+ offer live TV with cable channels. Streaming platforms are also eager to license content normally delegated to traditional TV channels, including old shows like Suits, the 2023 streaming record-setter, and live sporting events like WWE Raw.
Channel surfing 2.0
If you've followed the streaming industry lately, you won't be surprised to hear that ad dollars are reportedly behind the push for live channels. Disney+, like many streaming services, aims to be profitable by the end of Disney's 2024 fiscal year and extract as much revenue from each subscriber as possible (including by using tactics like password crackdowns) to fuel profits.
The news follows similar moves by Disney, including adding Hulu to the Disney+ app, as well as plans to add ESPN to Disney+, too, according to The Information. Disney is also attempting to launch a joint sports-streaming app with Fox and Warner Bros. Discovery (WBD). It's not hard to imagine Disney one day (assuming the app ever debuts) making the sports app's content accessible through Disney+.
"The idea is to make Disney+ a service that has something for everyone, anytime," The Information reported.
That sounds an awful lot like cable, which spent years growing customers' monthly bills by adding more channels and bundles aimed at specific interests, like children's entertainment, sports, and lifestyle. The ability to hop from on-demand Disney kids' movies to on-demand sitcoms on Hulu to live programming centered on (the seemingly endless piles of) Marvel and Star Wars content feels a lot like channel surfing. It wasn't too long ago when channel surfing was viewed as a time-suck.
Netflix has also reportedly considered ways to unite other streaming platforms with Netflix in order to extend the amount of time spent on Netflix. In late 2022, Netflix "explored creating a store within its app for users to subscribe to and watch other streaming services, all without leaving the Netflix app," The Information said, citing an unnamed person "who was involved in those exploratory discussions." Netflix reportedly decided not to move ahead with the plans for now but still could. It hasn't commented on The Information's report.
As we saw with Netflix's password crackdown and streaming's shift to ads, streaming companies tend to copy each other's strategies for revenue growth. And live channels could be something more streaming companies get involved in. Media conglomerate and Max owner WBD, for example, already has channels with live programming (although WBD's aren't available through its streaming app, like Disney's reportedly will be).
Disney, notably, is no stranger to the business of online live channels, having 21 similar offerings within the ABC.com app, including a channel for ABC News and another for General Hospital.
Subscription-based streaming services may even have an easier time competing for ad dollars than free, ad-supported TV (FAST) streaming channels, such as those on Tubi and Pluto TV. Susan Schiekofer, chief digital investment officer for GroupM, the top US ad-buying company, told The Information that advertisers might feel more comfortable allotting dollars to ad-supported channels that are tied to users who have already spent money on a subscription.
Streaming services initially were a way to get only the content you wanted on demand and commercial-free. But the report about Disney+ and Netflix are just two examples of growing interest in reinvigorating the strategies of linear TV. Instead of jumping from network to network within cable, there's interest in getting people to jump from one streaming service to another within one platform—with plenty of commercials along the way.
