Netflix is no longer number one in streaming. At least, the pioneer of video on demand is no longer the company in the sector with the highest number of subscribers. Its main competitor Disney has revealed that its platforms Disney +, Hulu and ESPN + add 221 million subscribers. This is the first time that Netflix has been dethroned since the creation of this type of service.
By publishing its quarterly results on August 11, the Disney group disappointed forecasts. While the video-on-demand market appears to be reaching a glass ceiling, Disney+ managed to gain 14.4 million new subscribers between March and June 2022.
A new fee schedule for December 8
At the same time, Netflix has been struggling since the beginning of the year. With two consecutive quarters of subscriber losses, the company hopes to renew itself through a new strategy that will be launched in the coming months.
However, at the platform level, Netflix remains the leader. It has 220.7 million subscribers while Disney+ has only 152 million worldwide. Even Amazon outbids Disney with more than 200 million Prime Video subscribers.
But Disney’s streaming growth could stall. In publishing its results, the group revealed its intention to increase its prices in the United States from December 8. But for this new price list to be accepted, an ad-supported offer will be proposed. Which convinced Netflix to do the same.
Thus, the Disney + entry offer remains at $ 7.99, but will include advertising. According to the Wall Street Journal, nine to twelve ads per hour are needed, for a total of four minutes per hour. Subscribers who don’t want to see these ads will have to pay an additional $3 or $10.99.
Profitability still expected in 2024
Disney+ thus replicates the system already in place by Hulu. This other streaming platform of the Disney group will also increase its prices, as indicated by Gizmodo. With advertising, the subscription goes from $6.99 to $7.99. Without ads, Hulu lists a price of $14.99 versus $12.99 today.
Logically, the service of the group dedicated to sports, ESPN +, also adopts this price increase. The monthly offer goes up from $6.99 to $9.99 and the yearly offer from $69.99 to $99.99.
For now, Disney has not specified whether these increases will carry over to other markets. Only the United States seems concerned so far.
This new strategy has an impact on the group’s forecasts. Chief Financial Officer Christine McCarthy said on the earnings conference call, “We remain confident that Disney+ will achieve profitability in 2024.” The company expects to have 215 to 245 million users in 2024. That’s 15 million less than previous estimates.
Source: BFM TV
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