Netflix and Disney are now considering free, ad-supported streaming

Streaming services Netflix and Disney are reportedly considering the introduction of a free, ad-supported tier in response to consumer frustration over rising prices. Disney CEO Josh D'Amaro disclosed during a recent investor call that the company is actively exploring this option for its Disney+ streaming service. D'Amaro noted that a free offering could cater to price-sensitive customers who may be unwilling to endure regular price hikes.

Disney+ has undergone multiple price increases since its launch in 2024, with the most recent occurring in October 2025. The company raised ad-supported plans by $2 per month and ad-free plans by $3. This move by Disney underscores the challenges faced by the video streaming industry, which has transitioned from a more affordable alternative to cable to a model that increasingly mirrors cable in terms of pricing.

Similarly, Netflix co-CEO Greg Peters acknowledged the free streaming dilemma during an investor call in July. While Netflix is expected to consider a free offering, the company emphasized the need for caution, as such an option could potentially erode its more profitable paid tiers. Netflix, with nearly twice the subscriber base of Disney+ (over 325 million versus 131.6 million and counting), is also grappling with price-hike fatigue and slower customer growth.

The move by Disney and Netflix reflects the growing pains of the video streaming business. As free services like Pluto TV gain popularity, all major streaming players may eventually confront the same challenge, potentially drawing users away from paid platforms.