Disney+ Raises Subscription Fees: Is The Ad-Free Experience Worth The Extra Cost?

(CTN NEWS) – Are you finding the ad-free version of Disney+ so enjoyable that you’d consider a higher subscription cost? This decision looms for subscribers, as the company is gearing up to raise the price of its popular service by a substantial 27%.

Disney+ and Hulu Subscription Prices to Increase: Ad-Free Options and Bundled Services Affected

The price for the ad-free option of Disney+ will be elevated by $3 per month, bringing it to $13.99, while the ad-free version of Hulu will also see a 20% hike from $14.99 to $17.99. Interestingly, the prices for the ad-supported tiers of both services will remain unchanged.

Adding to these changes, Disney has disclosed its active exploration of measures to tackle account sharing, a development that may impact how the services are used among different individuals. These modifications are set to take effect starting October 12.

The bundled options will also see adjustments in their pricing: the combination of Disney+ and ad-free Hulu, along with ESPN+ featuring ads, will increase to $24.99 per month from the previous $19.99.

Meanwhile, the package comprising all three services with commercials will now be priced at $14.99 per month, reflecting a $2 increase.

If you’re content with ads, the joint subscription of Disney+ and Hulu will continue at $9.99.

Additionally, a new offering that combines both products without ads will launch on September 6, priced at $19.99 per month. This marks a notable shift in pricing strategies, with Disney nearly doubling the cost of Disney+ since its initial launch in 2019.

Disney’s Evolving Pricing Strategy: Password-Sharing Crackdown and Subscribers’ Response

Less than a year has passed since Disney raised the cost of Disney+ from its initially appealing rate of $6.99. CEO Bob Iger pointed out that the company observed no major drop in subscribers or significant churn in 2022, despite that initial price adjustment.

In a move that brings its pricing strategy closer to that of Netflix, Disney is now taking cues from its competitor’s stance on password-sharing.

Iger acknowledged that a considerable portion of customers engage in password-sharing, and he mentioned the company’s technical capability to monitor login activities.

He confirmed that addressing this issue is on the agenda for the upcoming year.

“While it’s probable that we’ll witness some impact in the 2024 calendar year, it’s conceivable that the full implementation may extend beyond that timeframe,” explained Iger.

“Nevertheless, we have indeed prioritized this matter and believe it presents an opportunity to drive our business growth.”

This announcement coincides with a minor decline in Disney+ subscribers in the United States and Canada, dropping from 46.3 million to 46 million.

Concurrently, the ad-supported service has attracted 3.3 million subscribers, with approximately 40% of new sign-ups opting for this tier.

Disney’s India-based Hotstar service suffered a significant loss of 12 million subscribers since April, largely attributed to the loss of broadcasting rights for the Indian Premier League (IPL) cricket matches.

Disney has set its sights on making its streaming division profitable by September 2024. In the third quarter, the division incurred a loss of $512 million, likely motivating the decision to raise prices.

While Iger appears confident that subscriber losses post-price increase will remain insignificant, the second such adjustment within less than a year might potentially challenge that assumption, especially during a period of economic uncertainty when consumers are exercising caution in their expenditures.

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