Disney is set to unveil a more budget-friendly streaming choice adorned with advertisements in the UK this November, as the company grapples with declining profits. The scheme, already accessible in the US, is also slated for launch in select European regions and Canada. For UK audiences, the fresh tier will be priced at £4.99 per month, while current subscribers will face a £3 hike to retain their current privileges.
Disney’s effort to clamp down on password sharing mirrors actions taken by its competitor Netflix. The company is grappling with a variety of challenges, including underwhelming film performance and a significant slump in advertising revenues. Although overall revenue saw a 4% year-on-year boost during the quarter ending July 1, Disney reported a loss of $460 million (£361 million), in contrast to the $1.4 billion profit achieved in the same period the previous year.
Presently, Disney+ in the UK offers only a singular pricing tier, priced at £7.99 per month. However, the upcoming launch will introduce three new options:
- Standard with ads: Priced at £4.99 per month, this tier provides 1080p video quality and permits two concurrent streams on different devices.
- Standard: Available for £7.99 per month, this tier matches the previous one but omits ads and includes offline video downloads.
- Premium: Priced at £10.99 per month, this top-tier option delivers 4K video quality, downloads, and the ability to stream on up to four devices simultaneously.
All existing UK subscribers will automatically benefit from the new premium service offerings, effectively translating to a £3 per month price hike for users wishing to retain the same features. Disney’s introduction of an ad-supported service emulates Netflix’s similar move last year. Netflix, a market leader, implemented several measures after observing a slowdown in subscriber growth in 2022, including curbing account sharing, a strategy that Disney’s CEO Bob Iger indicated the company would adopt.
Disney spotlighted advancements within its streaming sector, reporting that losses had decreased by half compared to the previous year, amounting to approximately $500 million in the quarter concluding on July 1. Although the core Disney+ service observed a 1% international growth, subscriptions in the US dwindled by 1%. Nevertheless, Disney acknowledged that certain recent film releases, such as a live-action rendition of “The Little Mermaid” and “Guardians of the Galaxy Vol. 3,” yielded disappointing results.
The Disney Hotstar service in India faced a 24% drop in subscriptions after losing cricket broadcasting rights. Meanwhile, services like ESPN and Hulu saw limited changes. Insider Intelligence analyst Paul Verna characterized Disney’s results as “mixed,” unlikely to soothe investors seeking clarity on the company’s streaming service and television network strategies. While Disney managed to narrow streaming-related losses in the past quarter, the reduction primarily stemmed from workforce cuts and reduced content spending rather than organic growth.
Disney’s Florida amusement park experienced a decline in visitor numbers, partially attributed to a feud between Governor Ron DeSantis and Disney over what DeSantis labeled “woke” policies. Nonetheless, Disney executives attributed the decline to broader trends, such as the return to post-pandemic normalcy and decreased international travel. In response to the challenges, CEO Bob Iger expressed confidence in Disney’s long-term trajectory but acknowledged the need for continued efforts to enhance the company’s prospects.
source:bbc
