What’s Next for Disney+’s Ad Tier and Clarity on Bob Iger’s ‘Hot Mic’ Moment

It’s been a busy year for Disney Advertising and the company’s streaming platforms.

In 2024, Disney saw 40% of its total upfront dollars earmarked for streaming and digital offerings, and it has taken steps throughout the year to bolster that side of the business, including now working with nearly 40 demand-side platforms, making investments in multicultural programming and DEI-centric (diversity, equity, and inclusion) branded content, and going through a major reorganization to bring Disney video ad inventory to more midmarket advertisers.

“We came out of what was a very tough advertising year the year before, with growth across most—if not all—of our platforms in terms of the number of advertisers we’re working with and the types of opportunities we’re creating,” Rita Ferro, Disney’s president of global advertising, told ADWEEK.

Speaking with ADWEEK, Ferro previewed Disney’s upcoming Tech and Data Showcase, explained what’s ahead for Disney+’s ad tier, and addressed Disney CEO Bob Iger’s comments following a recent “hot mic” moment.

In Disney’s latest earnings call, Iger said around 60% of all new Disney+ subscribers are going to the ad-supported tier. However, the CEO was later heard questioning whether he was supposed to share those statistics. Ferro is now bringing some clarity to the situation.

ADWEEK: Rita, looking back on 2024, what were some of the highlights for Disney Advertising? What were the priorities?

We’ve spent a lot of time driving our automation business and how we think about the right partners to drive the scale and growth of our programmatic business, and obviously building out and continuing to evolve our self-service platform. We spent a lot of time making our data interoperable with the marketplace because more and more marketers want to come in and buy very specific, targeted media around audience segments. And so we wanted to make sure that, regardless of what platform they’re using or how they come in, we can drive that opportunity to plan, buy, and measure every one of their campaigns across our portfolio. That’s important.

We continue to make investments around multicultural programming and commitments with marketers, investing in their core consumers—audiences that drive growth, consumption of their brands, and are fans of their brands.

And then it’s really around that midmarket segment.

You went through a major reorg to reach midmarket advertisers. Can you talk about the importance of reaching those advertisers, some of whom haven’t advertised with Disney before?

We want to make sure that when people want to be in the market and think about launching a new product, launching a new service, they’re like, “Oh yes, and we have to call Disney, because they hear us, they understand us, and they’re involved with us and everything that we’re building,” and that’s been really important. We’ve made a significant impact there. It’s really helped our business.

Earlier this year, Disney had a live Academy Awards moment where Don Julio became the first brand integrated into Jimmy Kimmel’s in-show bits. You also had a Johnnie Walker moment with Ebon Moss-Bachrach at the Emmy Awards. Now, Conan O’Brien is hosting the Oscars. Can you talk about the opportunity there, and will we see more live integrations going forward?

We’ve been doing that for years with the Oscars. The Academy of Motion Picture Arts and Sciences is a great partner with us in looking at ways to deliver for brand partners and those presenting partners that come in and want to be part of the storytelling. A lot is done on the red carpet, sometimes in the green room backstage. And so we look to customize what a brand is looking to experience or create for the fan, for the viewer, or actually even onsite for the nominees to really tailor it to the outcomes that they want. But that continues to be a huge opportunity for us.

On a recent earnings call, Disney CEO Bob Iger said around 60% of all new Disney+ subscribers are going to the ad-supported tier. According to Iger, about 37% of all subs in the U.S. are AVOD (advertising-based video-on-demand) subs, and 30% globally. After saying that information, there was a “hot mic” situation where Iger was heard questioning if he should’ve revealed the statistics. So, should he have?

You’re going to see numbers coming out soon in terms of what exactly those subscribers are. What we are doing is looking at it from a full portfolio approach versus individual platforms. Because with Hulu on Disney+ and ESPN coming on to Disney+, you want to make sure you have the right number in place so you don’t have duplication of numbers. For us, it’s around making sure that we have the right number to put out there. What I heard from what he said was, ultimately, we have, if you look at everyone—because Hulu has been reporting numbers for years—is about 60% or 65% ad-supported tier. We’re getting there with Disney+. There’s room for growth. That’s exciting for us, but we want to make sure—because Hulu is on Disney+ and ESPN is coming—that we have one number that speaks to our full advertising portfolio.

OK, so that was about making sure that ad tier number is the final number you want to release?

Yeah, and I think you’re going to see it, because Nielsen, I think, is coming out with their kind of MAU (monthly active user) number.

What’s ahead for the Disney+ ad tier in 2025 and Disney’s adtech?

We know that over 50% of the people who are signing up for Disney+ are choosing the ad tier. The number fluctuates, but it’s definitely over 50% consistently on a month-to-month basis.

We’re very excited about our Tech and Data Showcase, where we’re going to talk about what is next in this upcoming year. Last year, we announced Disney’s Magic Words. We’ve now had a couple of brands come in and test with us. We’ve learned some things about what is next around contextual advertising and putting the right ad at the right time in front of the right consumer, and what that drives in terms of opportunity for brands.

We’re very excited about our global rollout and making sure that customers understand the enablement of our global technology stack so that every time we’re launching new advertising products and innovation in the U.S., our global markets are able to take advantage of those. And as more and more brands are looking for global opportunities, Disney is going to be an important partner for them in that space, just given how much of our content resonates globally with our key franchises around Marvel and Star Wars and Disney, and some of our best shows, which resonate around the world.

What else can marketers expect from the Tech and Data Showcase?

We’re also going to talk about Generation Stream’s next version. We’ve put out these thought leadership studies. Hulu did the first one, Gen Stream, before we merged with them. But then we did Gen Stream Sports. We did Gen Stream Family. That was version three, and we’re going to put out the results around Gen Stream global advertising marketplaces. And so I think we’re very excited about the global consumer, who they are, how it’s different, and how it’s the same across our platforms around the world so brands have a full understanding of how to best partner with Disney on our streaming businesses.

And then the last thing I think we’re going to talk a little bit about is teasing advertising innovation and the upcoming ESPN flagship product and opportunity, what that will mean for partners in terms of sports and streaming.

You have the ESPN flagship streamer coming out. But you also have the ESPN tile coming to Disney+, much like the Hulu tile already came to Disney+. What’s the difference between the tile and the flagship streamer?

The tile will be a lot of content from ESPN that we think audiences that are on the Disney+ platform will enjoy and consume, and it may be different than some of the content that you would traditionally see on ESPN+. We know that the consumer on Disney+ is a different consumer, and they’re probably not a heavy sports fan. Some may be, but we want to give more sampling of content with a bent toward live events and alternative casts. For example, we’re going to have a Mickey and Minnie alt-cast for the National Basketball Association Christmas Day games. So, there are a lot of those types of things. More women’s sports because we know that there are more women watching on Disney+. And by the way, why not give them incredible storytelling and sports that inspire and get them excited about watching more content? So it’s around an audience expansion opportunity.

It gives more sports that are relevant to the consumer on that platform with the insights we have around who the consumer is on that platform. It allows us to bring that to the platform in a way that will be interesting, unique, and ultimately potentially create new content that’s unique and bespoke for the ESPN tile on Disney+. It’s complementary to what you’re going to see on the flagship, and it will be around video experiences, not a full, immersive platform that, eventually, ESPN flagship will become.

This interview has been edited for length and clarity.