Netflix’s revolutionary impact on television is beginning to fade. Our scoop today that Disney is considering a cheaper, ad-supported version of its Disney+ service shows how streaming is inexorably gravitating toward the traditional TV model. Such a move means Disney would follow NBCUniversal, Discovery, Paramount, WarnerMedia and even Amazon in offering low-cost or free streaming tiers that carry ads—making Netflix and Apple the ad-free outliers.
And ads are not the only feature of old-fashioned TV coming to streaming. Disney has been at the forefront of companies introducing bundling—in December, it started requiring subscribers to one of its Hulu services to also take Disney+ and ESPN+ as part of a bundle. You can bet that once Discovery completes its WarnerMedia acquisition, it’ll find a way to bundle Discovery+ with HBO Max. Why do these shifts matter? Because both advertising and bundling are two ways companies can turn streaming into a profitable business.