Hulu And Disney+ Will Soon Increase Prices And Crack Down On Password Sharing
All is not well at the House of Mouse. On a live-broadcast quarterly earnings call today, the returned prodigal CEO Bob Iger announced two troubling indications of Disney's current financial state: the company will soon significantly raise the price of certain subscription packages for Hulu and Disney+, and also intends to roll out a password-sharing crackdown program in 2024, following in the footsteps of Netflix, which now charges you to share your password.
The news is troubling but not surprising, as the last quarter heralded the arrival of several telltale signs of economic hardship for the company. After launching in late 2019, Disney+ took no time to become a streaming juggernaut, surpassing Netflix's total subscriber base by the summer of 2021. Later that year they sweetened the deal, offering steep discounts if you signed up on select "Disney days," with some offers reaching as low as $1.99 for the first month.
At the turn of 2023 Disney+ posted its first subscriber losses, and it's only been downhill from there. The streamer lost an estimated 11.7 million subscribers in the three-month period that ended on July 1, 2023. A report by Variety notes that a good deal of that drop can be attributed to a 24 percent subscriber loss in India due to a strategy shift in the Disney+Hotstar service bundle. But today's announcements regarding password sharing and monthly subscription costs point to more generalized problems that won't be easily resolved. Let's dig into what that means for the average Disney+ and/or Hulu subscriber.
The fall of the house of Mickey
If you're already a Disney+ subscriber, these price hikes might be bringing on a feeling of déjà vu. This past December Disney+ hiked its ad-free subscription tier up three whole dollars to $10.99/month. Now that tier will be priced another three dollars higher at $13.99/month. Hulu ad-free subscriptions are increasing by three dollars as well, from $14.99 to $17.99 per month. Hulu has some of the most popular shows on streaming, from "The Bear" to "The Kardashians" to "The Handmaid's Tale." But a $200+ yearly bill is likely to push even loyal subscribers to reconsider how they allocate their streaming budget.
There are still more affordable ad-supported options for both streamers. Disney+ and Hulu's ad-supported tiers will both remain at $7/month, and the most positive piece of news from today's call on the subscriber side was the announcement of a new ad-supported Disney+/Hulu bundle priced competitively at $9.99/month. If you want both Disney+ and Hulu without the ads, you're looking at $19.99 per month, but if you compare that to the $30+/month you'd be paying if you subscribed to each separately, it is a decent savings.
As for the password-sharing crackdown, Iger was vague. "Later this year, we will begin to update our subscriber agreements with additional terms and our sharing policies," he said on the Q3 earnings call, vowing to "roll out tactics to drive monetization sometime in 2024." Netflix is the first major streamer to take a stab at the common practice of password sharing. While many online have grumbled, promising to ride out of the Netflix saloon and into the sunset for good, subscriptions have only gone up since the policy's implementation. Disney must be hoping for the same outcome, but only time will tell.