Disney+ loses 1.3 million subscribers after raising price twice (2024)

It's one of the world's most popular streaming services.

But Disney+ has lost a staggering 1.3 million customers globally in just three months, largely due to soaring prices.

Between October and December 2023, global subscribers fell from 112.6 million to 111.3 million – despite an increase in revenue during the same period.

What's more, Disney has made more money from each subscriber due to price hikes for the service over the course of a year.

Between December 2022 and October last year, the company increased the price of ad-free streaming in the US twice.

Disney revealed the news in its latest quarterly earnings announcement on Wednesday, although it is hopeful to reverse the trend.

It expects to add up to six million subscribers in the current quarter, which runs from January until the end of March.

'Disney+ core subscribers decreased sequentially by 1.3 million, in line with prior guidance,' said Hugh Johnston, Disney's chief financial officer.

'While subscriber growth will vary from quarter to quarter, we are confident in our prospects for ongoing sub growth over the longer term.'

Mr Johnson admitted that the fall was due to 'recent domestic price increases', as well as the end of the global summer promotion period.

Much to the annoyance of users in the UK, Disney+ overhauled its pricing system in November.

Up until then there had only been one price for Disney+ in the UK – £7.99 a month or £79.90 a year subscription.

But as part of the overhaul, Disney+ separated into three tiers – one for £4.99 per month, another for £7.99 per month and the third for £10.99 per month.

Those who opted for the £10.99 tier – which includes4K HDR experience with Dolby Atmos sound – were effectively paying an extra £36 per year.

What's more, the £4.99 tier was only cheaper because it introduced adverts, which play before and during films and TV shows.

In the US, Disney+ introduced the ad tier in December 2022, while raising the cost of streaming without any adverts from $7.99 to$10.99.

Less than a year later, in October, Disney+ then raised the price of ad-free streaming yet again, from$10.99 to $13.99.

Also last year, Disney+ announced a crackdown on password sharing, following a similar move from Netflix, which aims to increase the amount of new sign-ups.

Password sharing is the common habit of an account owner disclosing their password to a 'borrower' so that they can use their account and not have to pay.

An updated subscriber agreement from Disney sent to users in a lengthy emailreads: 'Unless otherwise permitted by your service plan, you may not share your subscription outside of your household.'

Mr Johnson said during Disney's earnings call that any accounts suspected of the 'improper sharing' of passwords will be prompted to start a separate subscription for the 'borrower' starting this summer.

Alternatively, just like Netflix, Disney+ account owners will be able to pay an extra fee to let the borrower use their account.

Despite the fall in subscribers, Disney posted stronger-than-expected earnings for the final three months of 2023, boosted by thousands of job cuts and other cost-cutting measures, as well as growing revenue from its theme parks business.

Revenue for the quarter was $23.55 billion, up from $21.24 billion the prior quarter and just above $23.51 billion in the same quarter a year ago.

Disney earned $1.91 billion – up 49 per cent from $1.28 billion in the same period a year earlier.

Disney also announced it is paying $1.5 billion for a stake in Epic Games, the video game company best known for producing Fortnite.

Together they will create a 'games and entertainment universe' that will feature games, shows and characters from Disney, Pixar, Marvel, Star Wars, Avatar and more.

'This marks Disney´s biggest entry ever into the world of games and offers significant opportunities for growth and expansion,' said Disney CEO Bob Iger.

The company boss also declined to respond to Elon Musk's comments against him after the Disney pulled advertising from his social media platform, X.