Disney+ in the States is seeing a massive price hike come December. Big Mickey announced the hike yesterday, but so far it only applies to the U.S. There’s no word on how this could affect other countries yet. As South Africa has recently seen the launch of Disney+, we’re hoping that Disney overlooks us – at least for a couple of months.
An increase of 38% is on its way. The hike takes place on 8 December, increasing a monthly sub from $8 to $11. That’s nearly an R50 increase in South African terms. The pricing restructure gives the company a chance to introduce its ad-supported tier, which jumps into its $8 slot. Yes, Disney+ won’t actually be free with ads. It’ll just be a little cheaper. American streaming services Hulu and ESPN are also experiencing a price hike.
Disney+ needs to turn a profit
Any question concerning Disney usually has one answer; money. It’s no different this time. Last quarter, Disney reported 8 million new subscribers, while Netflix announced a decrease in subscribers at the same time. Now, the streamer has 152 million subscribers, and a further 69 million (don’t say it, don’t say it) on its Hulu and ESPN services.
The issue is, Disney’s streamers weren’t making money. More money is spent on production costs and streaming rights to attract a larger customer base. And it worked. The king of streaming stumbled, and Disney is looking to claim the crown. Now, the company can implement the plan it’s had all along. Raise prices, and introduce ads at the same time.
During an earnings call, Big Mickey felt confident that its streaming services would be profitable by 2024. It lowered its prediction of monthly users from somewhere between 230 million and 260 million, to a now more realistic number of between 215 million to 245 million.
Not hikes in South Africa… yet
Price hikes were only announced for the U.S, though SA might expect a hike in the not-too-distant future. Disney+ wants to be profitable – meaning everyone will suffer the hikes hitting the U.S eventually.
Read More: This is how the ad-supported Disney+ tier will work when it launches
We can’t be sure when, or even if, a price hike will come, but we can make a guess that it’ll be next year. Disney will keep the prices ‘low’ until it has enough customers hooked before raising prices. We’ll also see that ad-supported tier in SA eventually. Disney will probably follow a similar pattern – raise prices by R50/R60 for the ‘premium’ tier, and introduce its ad-supported tier for the starting prices we’re used to.