Disney Plus reportedly considers a free ad-supported streaming tier

Adam Smith, Disney's chief product and technology officer, raised the idea of a free streaming tier for Disney+ during a company town hall on Thursday. The plan is still being explored, and Smith did not give a timeline or say which movies or shows would be included. The discussion lands as Disney tries to balance higher-priced bundles, ad sales, and an audience that is moving steadily toward free, ad-supported viewing.

Disney+ and Hulu currently cost $11.99 a month with ads or $17.99 without, while adding ESPN pushes the bundle to $35.99 with ads or $44.99 without. That pricing puts Disney in a sharper contest with YouTube, Tubi, The Roku Channel and Pluto TV, where viewers can watch without paying a subscription fee. A free Disney+ tier would not just widen the funnel for new viewers, it would also give Disney more inventory to sell to advertisers at a time when ad-supported streaming is already drawing a larger share of living-room attention.

Nielsen's monthly TV usage data shows the three largest free streamers accounted for 18.7% of U.S. TV watch time in April 2026, up from 16.8% a year earlier and 12.7% in April 2024. Streaming as a whole surpassed broadcast and cable combined in May 2025, reaching 44.8% of all U.S. TV viewing. That shift has made no-cost video a central part of the market, not a fringe option, and it helps explain why Disney would consider loosening the paywall around at least part of its catalog.

Disney's own financial results also point in that direction. In its fiscal first quarter of 2026, the company said SVOD revenue rose 11% year over year and streaming operating income climbed to $450 million, while segment advertising revenue fell 6%. Around the same time, Disney stopped publicly disclosing Disney+ and Hulu subscriber totals, which leaves watch time, ad demand and bundle uptake as more important signals of whether the streaming business is still expanding.

Chief executive Josh D'Amaro has said Disney wants a more connected consumer experience with Disney+ at the center, and the company has been experimenting with short-form and vertical video across its apps. A free tier would fit that broader push, but it would also underscore a hard reality for the streaming industry: price hikes and premium bundles can only go so far when more of the audience is spending time on free platforms that are already winning in scale.