Disney to ban Netflix from running ads on TV network
The Walt Disney Company, popularly known as Disney is banning streaming services from running advertisements on its platforms. The entertainment conglomerate is currently at odds with Netflix and Amazon over advertising deals in both traditional linear and streaming TV, highlighting the new complexities of today’s TV marketplace.
Disney is banning Netflix from running ads on its TV network, which includes ABC, ESPN and FX. The Wall Street Journal reported on October 4, 2019, that Disney had planned a blanket ban on all streaming services that may rival its own product, Disney+, but eventually settled on only disallowing ads from Netflix.
Neither NBC Universal nor WarnerMedia, two of Disney’s biggest TV rivals who are also set to launch new streaming services next year, have such a rule. Both companies said they have and will continue to accept ads from competitors, including Netflix.
Brian Wieser, GroupM’s global president of business intelligence, said Disney’s decision to ban Netflix ads show that the “lines will get blurrier” as TV networks integrate their traditional services and their streaming services.
“If [Disney] is saying that its properties in traditional environments are an integrated business unit with Disney’s streaming service, and that Disney considers it to be directly competitive, then there’s a case to be made for saying you don’t want your competitors products,” Wieser told The Drum.
It’s not like they actually lose money, they’ll just end up taking it from different advertisers.
Where Disney is looking to not lose more money than it wants is on Amazon’s connected TV platform, Fire TV. The Journal reported yesterday (3 October) that Disney and Amazon are at an impasse over carriage agreements for Disney’s family of apps within the Fire TV ecosystem.
Similar to how cable operators take a chunk of ad inventory from the channels they carry, Amazon apparently wants the right to sell a large amount of Disney ad inventory – and Disney is pushing back.
If they don’t reach an agreement, Disney’s family of apps could be removed from Amazon Fire TV, like how cable carriage disputes lead to blackouts, such as Sinclair’s current spat with Dish.
The difference in streaming, however, is the business model has yet to be set. Depending on distributor and media owner, both sides could either agree to a revenue share or divvy up ad inventory and sell space separately.
Wieser said the “moving parts” that comprise negotiations between packagers of content, such as Fire TV, and content owners are evolving, but the negotiations between Disney and Amazon don’t resemble a typical carriage dispute because there’s still no standard business model.
“It’s still early in terms of figuring out what the business models are that will be the norm or the standard,” said Wieser. “Once you get to something that looks like a stable, predictable business and then you have a renewal, then you can call it something more similar to a carriage dispute.”