The Walt Disney Company has reported its second quarter and six months earnings for fiscal 2023, and with it comes new statements from Disney CEO Bob Iger that suggest Disney+, the company’s streaming service, is about to get worse for subscribers. Per a roundup of highlights from CNN, Disney+ is planning to not only produce less content for its streaming services going forward to reduce losses and ensure bigger profits, but higher fees are also in the pipeline, with the cost of the ad-free version of Disney+ going up to “better reflect the value” of its content offerings. Disney+ will also be increasing the amount of ads in its services, and while that doesn’t sound great, the company did confirm that Disney+ is set to expand with a new subscription option that combines Hulu and Disney+ into a single app.
From a CNN report:
[…] it expects to remove some of its existing content on the streaming services, and will be taking a $1.5 billion to $1.8 billion charge in the current quarter related to the removal of that content. And CEO Bob Iger said the company will produce less content for the services going forward.
Secondly, it is looking to increasing the amount of advertising on its various services, including a European version of Disney+ with ads that will debut later this year.
And for those subscribers who want to pay for an ad-free version of Disney+, they will be paying higher subscription fees, Iger said, “to better reflect the value of our content offerings.”
The company said it saw only a very minor decrease in subscribers to the ad-included service when it raised subscription rates. And it said it wants to increase the subscription rates for the ad-free service partly to drive more subscribers to the ad-included versions, since it can make more money selling ads once it has more subscribers.
From The Hollywood Reporter:
Disney will be combining Hulu content with Disney+ content into one app in the U.S., CEO Bob Iger announced Wednesday.
The company will begin to roll out the new app by the end of the calendar year. For now, this option will only be available to consumers who have subscribed to both services.
“While we continue to offer Disney+, Hulu and ESPN+ as standalone options, this is a logical progression of our DTC offerings that will provide greater opportunities for advertisers, while giving bundle subscribers access to more robust and streamlined content, resulting in greater audience engagement and ultimately leading to a more unified streaming experience,” Iger said on the earnings call.
Discussion (19 replies)
Join Discussion →The Disney motto:
You can buy better but you can't pay more!
This was obvious. Disney had a good price to start, but it obviously was to grab as many susbribers as possible and nothing more. I dropped them after 3/years i had pre paid, never looked back, barely used it.
Disney's past 5 year run will be taught in business schools on how not to run a company and how not to handle franchises.
They managed to de-value both star wars and marvel from cash cow status to barely breaking even. (I'm being generous SW is outright loosing money on D+)
That's a shame. I enjoy their content, but only a small sample of it. Paying more doesn't seem like something I'd be willing to do at the moment to keep them.
Same. I lucked out and my annual renewed just before the last price increase, but there's only a couple of shows we watch there. It was already on the block to be dropped when the next renewal came up; if the price goes up even more it's a definite thing and we'll just sub one or two months a year to binge stuff as it comes out.
For all intents and purposes, this is just mirroring the same strategy and issues that David Zaslav is doing with Warner/HBO/Discovery/Max. Not arguing that some horrible decisions have been made with SW/Marvel but both companies are coming to terms with the reality of streaming in the post-lock-down era. TBH nearly all of the streaming services are in a state of adjustment right now, Paramount is no different with Showtime and we've been hearing about Netflix for a while as well. Amazon is about the only one not getting a lot of press right now.
First sign of Disney 's inevitable destruction (about freaking time and A LOT more to come when the Marvels, etc. releases):
First - when the CEO has to explain, GLOBALLY in fear, that Disney's business model "is not woke" to an angry base of viewers and the MSM? Alrighty then! ?
Second - when Disney has resorted to seriously disappointing even their most loyal fan-base which has lead MANY said fans to abandoning ship, Disney ONLY go-to choice ( to swindle a quick cash grab) was to re-release a 40-year-old film... 40-YEARS-OLD!!... back to theaters. Yeah... It's really bad over there at Disney!
Third - ...
In order to survive streaming has to become like cable, and I don't mean 7 minutes of ads every 5 minutes. I mean they need to be sold as an unified service like cable TV. You pay one fee to a provider and you get access to all "channels" through a single set top box / app.
Those exist... Buuut... They require sailing.
There is no need for this at all. Why recreate cable , it makes no sense. Buy a roku and pay all subscriptions with your roku account and call it a day if you want.
I will never pay for cable, i will never pay for streaming with ads. Free is the only price for crap with ads. You centralize streaming, up next is ads, exactly how cable evolved, you know, ads inserted by the service bundler there. Then streamers will fight the bundler/ provider for a bigger cut and so on. Its cable all over again. No need. Cable can shove it, that thing is unwatchable, hell not even free. This is just Disney and they can shove it too streaming or cable or movies. Big issue Disney has is the money fiesta is slowing down for them and every big company anyway. They are just pooping their pants cause they have to inject uncertainty in their own market via price hikes and whatever else, they have no idea of how price sensitive their customers are, nor do they know if they are going to hit a Bud light moment also. They don't know how woke sensitive their customers are. Anheuser Bush is getting a bit of a taste, not sure it will mean anything long term though.
I don't want to pay for all of them separately. Most people don't, they just choose one or two, and call it a day. I have zero clue about roku as that's not available where I live, which is another can of georestricting worms you don't want to get me started on.
Having one provider that offers all streaming services through a single unified interface for one flat fee would be a win win. Both for the user and the providers. Who are right now cannibalizing each other's user base.
The good thing about streaming over cable is that with streaming they can tell exactly what you watched and for how many minutes. So the cut of amazon / netflix / etc can be decided on the user level. If one user watched 240 minutes prime content, and 60 minutes netflix content then 20% goes to netflix and 80% goes to amazon. As opposed to currently where the user will simply only sign up for prime and netflix gets zero. This is the only path forward for multiple streaming services to be sustainable long term.
The other outcome is the bigdogs eating the other smaller ones, while they themselves also suffer from continuous attrition as customers flip flop between services, or pause their subscription while their favorite show is not getting new episodes.
This has nothing to do with ads, it has to do with access, ease of use and practicality.
I don't see any of those issues you mention, its really no big deal to pay for whatever you want to in whichever way. If I wanted to have as near as 1 account as I could, you can help that to a reasonable extent, i mentioned roku, but i think you could with apple, maybe more , i don't really care about it so I haven't research it much at all. Theres also services that handle your subscriptions at least for cancellation made easy, not that is hard with each service anyway.
I find it unlikely that such a percentage service will happen, though it might has yet another one but I don't think it will as a substitute. That would be an absolute catastrophe, and would mean mayor collusion etc etc, high prices to the moon in little time.
Hulu in many ways was just that idea, with numerous providers in it at the start with a mind of expanding. What an effin mess hulu turned into. I used it for a good while, it was decent for one hot second, then infighting started, and the service declined, I don't know if it recovered. Don't care to find out.
Theres also apps that cobble all your contents into one, but again the backbone is whatever services you are paying separate.
I wouldn't expect a spotify of video, content producers sink 100s of millions, adding to billions into said contents, and if that ever came to be, one app monopoly style if would probably be 100$ plus a month, or some such. Music yes can go high in cost, but can also be next to zero, and be good music anyway. Anyway i wouldn't know specific of your country. But really paying for a few services, having some on and off for some specific programs is not hard at all, and works very well. There is no need to recreate cable in the name of such trivial issues.
That was called... cable/satellite/VOD/TiVo, etc. once and how did that turn out?
There's just too many issues/COMPROMISES with that potential crippling idea e.g. privacy, controlling users' even further, constant rate hikes, etc. comes to mind super fast.
Nah, the best ONLY sure unfiltered/unrestricted no government/patent trolls regulation/violation and ISP sniffing plan is to subscribe to YOUR OWN FAMILY **LOCAL CONTENT** library and forget about it.
The MINIMUM tax ~$240/480 annually could go A LOT further towards content/equipment that you own that your family enjoys (and more than likely, there won't be enough **worthy content** that year to even justify up to that purchase tolerance/window from that pot) and not what some *service(s)* tells you what you suppose to like and just shut-up.
Your idea would never work in today's environment. All services are scared right now, even for those that are in the black right now. A major 3rd wave, or 4th, of layoffs is about to be launched very soon and there's nothing in the pipeline to ignite the world global economic fall.
Wise consumers are preparing to own and reduce their reliance on non-essential, CONSTANT PRICE HIKES, services, etc.
I am surprisingly ok not having them all at the same time.
Streaming totally changes the game on that - with Cable, stuff aired at a preset time, and often, if you missed it, you missed it - even with a DVR, if you don't have the service active when it airs, you missed it. VOD is an exception, but it's usually only a few paid movies that go up on that.
With Streaming though - it's up and it's there until they decide to pull it, so you have plenty of time to go back and watch stuff you missed.
In my opinion, right now the biggest thing that is working against streaming is that most of them are publicly traded companies.
Wall Street only rewards growth. That really is just about the only metric they reward, even over profit. If you aren't growing, you are dying - in their eyes, anyway.
Streaming services all have an upper bound they are going to attract and keep. If you see a wave of subscribers leave - that doesn't mean they won't be back or the service is dying, but Wall Street treats it that way and punishes the stock price.