In an update from the Walt Disney Company’s third-quarter earnings report, it was revealed that Disney Plus would be raising its prices. Starting from October 12th, the ad-free Disney Plus plan will cost $13.99 per month, an increase from the previous $10.99. However, the Disney Plus plan with ads will remain at its current price of $7.99.
This price hike was first mentioned by CEO Bob Iger during Disney’s Q2 earnings call in May. Iger explained that the purpose of this increase was to create a larger difference between the ad-free and ad-supported plans. Additionally, Hulu subscribers will also experience a price increase, with the ad-free plan costing a significant $17.99 per month. The Hulu plan with ads will remain at $7.99.
It seems that previous price changes made by Disney Plus did not deter subscribers, as the demand for the streaming service remained high. In fact, Iger expressed confidence in the upcoming price increase, stating that a previous significant hike in late 2022 did not result in substantial subscriber loss.
However, Disney Plus faced challenges in India during this quarter. The loss of rights to Indian Premier League cricket matches contributed to a significant decrease in subscribers by approximately 11.7 million worldwide. Despite these setbacks, Iger emphasized that their streaming business is still relatively young, having been launched in November 2019. He acknowledged Netflix’s success in balancing programming investment and pricing strategy, which contributed to their desirable margins.
Following the trend of combining content libraries into one app service, Disney is taking a page out of Warner Bros. Discovery’s playbook with the introduction of its new app, Max. This app will bring together the content libraries of HBO Max and Discovery Plus, providing users with a more comprehensive streaming experience. In considering potential future changes for Disney Plus, Iger hinted at the possibility of implementing password-sharing policies, similar to Netflix.
As Disney continues to navigate the streaming landscape, it’s clear that they are actively seeking ways to optimize their offerings, pricing, and engagement with their customers. While some price increases may present challenges, the demand for Disney Plus and its plans for expansion remain strong.