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Will Streaming Shift Be Palatable?
August 17, 2023
In the latest quarterly call, Disney CEO Bob Iger hailed the company’s new recipe for profit in the streaming marketplace — raising prices and inserting ads — two things that may be hard for consumers to swallow.
The company Aug. 9 announced a $5 increase in the price of its popular ad-free Disney+, Hulu and ESPN+ bundle to $24.99 monthly beginning Oct. 12. At the same time, the monthly ad-supported bundle price will increase $2 to $14.99. The new Disney+ and Hulu “Duo Premium” option without ads will cost $19.99 and launch Sept. 6. Standalone Disney+ and Hulu without ads will increase their monthly fees $3 to $13.99 and $17.99, respectively. Disney also said its ad-supported Disney+ offering will be available in select markets across Europe and in Canada beginning Nov. 1.
Meanwhile, even before the latest price increase, the company also reported that its branded Disney+ subscription streaming VOD service ended the recent quarter with 146.7 million subscribers, down 5.4 million subs from a year ago. While the majority of the sub loss occurred in India, where Disney+ Hotstar saw a 24% plunge in subscribers due to losing cricket coverage, Disney+ ominously also lost 300,000 subscribers in North America.
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Typically, raising prices and offering a poorer experience are not ingredients for pleasing consumers. Add in a content desert on the horizon due to ongoing Hollywood strikes and subscribers may ditch high-priced streaming for FAST food.