According to the Wall Street Journal, the Walt Disney Company has banned advertising from Netflix Inc. across its entertainment TV networks such as FreeForm, ABC, and FX ahead of launching Disney+. This move could be considered a sign that marketing wars are escalating over streaming as media juggernauts battle for subscribers.
Disney, Comcast Corp., and AT&T Inc. are likely to lay out hundreds of millions of dollars for advertising within the next year to pull consumers into their new streaming services. WSJ states that Netflix spent $1.8 billion on advertising in 2018 with $99.2 million on U.S. TV ads alone – 13% going to Disney-owned entertainment networks, according to estimates from ad-measurement firm iSpot.TV. With these new services coming into play in the near future, they’ll likely spend more defending their service.
Earlier this year, Disney stated that they would not be accepting advertisements from competing streaming services but they were able to come to a compromise with every company with the exception of Netflix who does not show ads in its content.
Disney’s push deeper into streaming is bringing to the fore its tensions with tech giants on multiple fronts. The company is separately at odds with Amazon.com Inc. over the financial terms for its apps in Amazon’s Fire TV streaming-media player, one reason that Disney’s forthcoming streaming service Disney+ has no Fire TV deal in place, The Wall Street Journal reported Thursday.
As we previously reported, Disney Chief Executive Officer Robert Iger resigned from the Board of Directors for Apple back in September; coincidentally on the very same day that Apple revealed that they were launching their own competing streaming service.
While it isn’t uncommon for TV networks not to accept ads from their direct rivals, Disney’s ban of Netflix ads is a sign of changing times as most broadcasters in general, have allowed streaming services such as Netflix and Amazon Prime Video to advertise. Now that we’re seeing traditional TV networks launching their own streaming services, they’ll be competing directly with tech giants as they never have before.
Disney+ launches on November 12 for $6.99/month and will offer content from popular franchises such as Star Wars and Marvel. Take a look at the Disney+ full streaming catalog we shared last month for a good look at what to expect.
Source: Wall Street Journal