Disney+ and Hulu raised subscription rates yet again

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Disney’s latest price hikes for ad-free Disney+ and Hulu plans, as well as the Hulu live TV packages and EPSN+ subscriptions, went into effect on October 12. This was the second time they’ve raised prices this year. Ad-free Disney+ is now $13.99, raised from $10.99. It originally cost $6.99/month. Hulu’s ad-free plan is now $17.99, which is a $3 increase. The live Hulu TV packages will go up $7/month and EPSN+ is increasing to $10.99/month. Whew.

So why is Disney raising prices yet again? Apparently, the company is reporting big fiscal losses and a decrease in subscribers. Disney park ticket prices are also lagging, probably because it now costs more than a monthly car payment for a family of four to visit Disneyland for just one day. So sure, when people stop going to your theme parks because they can’t afford it anymore, why not take it out on them by raising prices on your streaming services? Oh, wait! What’s that you say? Disney’s stock is at a nine-year low and investors are mad? Ooooh, okay, now this makes a lot more sense.

Disney reported streaming losses that totaled $512 million in its fiscal third quarter results — about half of the $1.1 billion loss reported in the prior-year period and less than the $777 million loss forecast by analysts. The company reported a streaming loss of $659 million in Q2 and a $1.1 billion loss in Q1.

Despite the narrowing loss, the company continues to shed subscribers. The media giant reported 146.1 million total Disney+ subscribers at the end of its latest quarter, a 7.4% decline from the previous quarter. Analysts polled by Bloomberg had expected to see paying users total 154.8 million.

The majority of its subscriber losses came from its Indian brand Disney+ Hotstar, which saw users drop by 24% on a sequential basis. Disney said Hotstar is not material to the company due to its lower average revenue per user, or ARPU.

Domestic users, however, which include those in the US and Canada, dropped by 1%.

In addition to streaming headwinds, the company’s parks business is slowing, its linear TV division is declining, and the media giant’s box office also seems to have lagged competitors. Iger has committed to several new initiatives to help realign the business — from putting Disney’s linear assets up for sale and searching for a strategic partner for ESPN’s streaming offering to partnering with sports gambling company Penn Entertainment (PENN) and recently raising theme park prices.

But that might not be enough to satisfy investors with the stock sinking to a nine-year low last week. Late Sunday, the company faced renewed pressure from activist investor Nelson Peltz, who launched yet another attack on the media giant.

According to sources familiar with the matter, Peltz will seek multiple board seats, including one for himself, after his hedge fund Trian Fund Management boosted its stake in the company, which is now valued at a reported $2.5 billion for more than 30 million shares.

[From Yahoo]

I’m not an economist, and my basic understanding of supply and demand is generally, “Everything is expensive because CEOs like having yachts.” I’m not sure the reaction to losing customers who didn’t want to pay for the first price hike is to raise prices again, but what do I know? I’m just a consumer, budgeting for a family of four every month. I am always skeptical whenever I hear of a company suffering “big losses,” because I know big businesses will pull some shady sh– for tax breaks. John Cusack had a great Twitter thread at the beginning of the SAG-AFTRA strike, talking about how studio execs used a “neat accounting” trick” to declare Say Anything a financial failure.

We cut cable back in February 2014 and have all of the big streaming services (Netflix, Hulu, Paramount+, Max, Disney+, and Apple TV+). We took advantage of their various deals and paid for a year up front, but now that most of those have ended, it’s starting to become too much. All of these streaming subscriptions added up are probably just as much if not more than cable packages were back in the day. Lately, we’ve been talking about which ones to cut. I think the top three on our chopping block are Hulu, Netflix, and Max. It’s a shame because I do think each streaming service has good original and back content to offer viewers, but greed and the almighty stockholders always win out in the end.

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39 Responses to “Disney+ and Hulu raised subscription rates yet again”

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  1. Seraphina says:

    CEOs and their big paychecks (as well as safety check if they get fired) and let’s not forget how much actors get paid. But yeah, let’s raise prices even more for those who make minimum wage so we can make more money. GREED.

  2. Lucy2 says:

    Disney owns just about everything, no way they are losing money. I agree clever accounting.
    I once heard they did the same thing with the movie back to the future, reworked the numbers over and over to show it never made a profit so they didn’t have to pay out.

    • Diana says:

      They are losing money. I think I read somewhere where they are consolidating assets etc, to try and get their deficit down.

  3. Robert Phillips says:

    All of this is just showing me that we are heading for another stock market crash. The stock market is not the economy. The stock market is gambling. It cannot continue to alway go up. But that is what everyone demands of it. But they have pushed it to far. And there are going to be a lot more homeless people out there.

    • SarahCS says:

      It sounds likely. I read the Enron book for the first time a few years ago and was horrified by what went on but I’ve come to realised that (with slightly less criminality) this is the norm for listed companies.

    • Erin says:

      Yep, it’s why capitalism cannot be sustained because its profits driven and there will be an end.

  4. SarahCS says:

    I haven’t checked if this is also hitting us in the UK straight away but if it is I can only assume that they figure everyone who can’t afford it already cancelled their subscription and those still around will (mostly) absorb the price hike.

    Disney and Netflix are both paid for by my boyfriend but if they were coming out of my budget I’d stop Disney then just re-subscribe for 2-3 months sometime next year to catch up on all the stuff I want to see. But I also don’t watch a ton of tv, maybe one episode of something in the evening so I’m definitely not their target audience.

  5. Samantha says:

    Just quit both Netflix and Disney+ in the last month. Only kept Netflix because my college-aged kids used it. And said kids grew out of the Disney/Marvel/Star Wars offerings. Down to just Peacock, Prime, and Max. Honestly, there’s too much choice. I feel old saying this but I liked it better when we just had cable and occasionally streamed a movie. Seems like I can never find the exact thing I want to watch.

    • Lala11_7 says:

      I’m just going to do ALL the subscription services when I need to …so in January…I’ll do Netflix for a month….etc…no longer will ANY OF THEM get my $ on a monthly 😡

      • orangeowl says:

        I’ve been doing this, too, for the most part, resubscribing when I want to see something then cancelling or pausing for a while when I’m done with the shows. I’ve been off HBO/Max since Succession ended and feel like maybe it’s time to cancel Hulu and try it again.

      • lucy2 says:

        That’s what I’ve been trying to do too, I turn HBO on and off, and I do a month here and there of other stuff if there’s a show I want to see. I use Hulu Live for my TV, so I keep that, plus some family members use it as well, but it’s now bundled with Disney+, so I have to have that whether I want it or not. It’s pretty annoying.
        Netflix got a lot more strict with their sharing, and are still raising prices.

  6. Carol Mengel says:

    Less people in the parks, but let’s raise the price for parking and annual passes too. Iger is supposedly all stressed out poor baby. Guess his new $27 million yacht is taking too long.

  7. Concern Fae says:

    I’ve been rotating the services for a while now. I also don’t really do streaming in the summer. Realized it gets dark too late to start a movie. Also, my local library has all the DVDs, so I have movies to watch when I want.

    These people are screwing themselves. They cancel shows people like and then wonder why people are dumping their subscriptions. The loyalty is gone.

  8. Bookie says:

    Ugh. I was so happy when I cut cable several years ago and was saving a ton of money, but now with the high cost of streaming services, it’s really not that much in savings.

    • Becks1 says:

      This is why we haven’t cut cable. We would still pay a lot to get the streaming services we want (Netflix and Max are part of our cable package so we don’t pay extra for those.)

      • schmootc says:

        Same @Becks1 – I went through my bill and realized that most of it was for internet service, not cable. And when I did the math to get YouTube TV and a few streaming services in place of cable, it didn’t add up. (And this is before the two bumps for Hulu. I noped out when ad-free was $10 or $11. $18 for that is highway robbery.)

  9. Ameerah M says:

    I switched to the basics Disney Hulu bundle with ads. I had the original trio bundle of Disney, Hulu & ESPN and was only paying about $13 a month for all three. Now I would be paying over $20 (with tax) for all three – with ads. No thanks. We don’t watch ESPN that much and I already have ads on my Hulu – I’m not paying an extra $6 a month just to not have ads on Disney +. So I dropped down to the basic bundle for $10. If their plan is to make subscribers pay them even LESS for monthly services – it worked. They’re now getting $3 less from me a month.

  10. Twin Falls says:

    I appreciate for now we don’t have to be locked into any one streaming service and I really like no ads. So I’ll make the effort to pick and choose the ones I pay for when I do and don’t have something particular I want to watch. I’d rather have the choice between streamers than the expensive ad filled bloat of cable tv packages.

  11. Melissa says:

    After Reservation Dogs announced season 3 would be the last Hulu announced their latest price hike, which was after Rez Dogs ended. No longer have Hulu👍🏻

  12. Cate says:

    Check if your local library offers any streaming. We have access to shows and movies through both hoopla and kanopy at our library and while they don’t have everything I’ve been pleasantly surprised at how much good content there is. My husband and I have found this to be a good option and now very rarely subscribe to streaming services–we’ll get a month occasionally if there’s something we particularly want, but aren’t paying for anything month after month.

  13. Angie says:

    We rotate which services we have at any given time. Works pretty well for us. We are Disney Parks ppl & yes those prices are over the top too.

  14. TIFFANY says:

    I still have cable (as it part of my tv/internet package) and I have HBO/Showtime, which is 8 bucks a month as part of my deal.

    Due to me having it, I have access to both apps.

    I was never a cord cutter because it was a feeling this was coming. Oversaturation was always the outcome.

    • lucy2 says:

      Yup. I cut the cord to internet only a few years ago, and was saving about $50-60 a month. Now all the streamers have crept up in price, and my internet cost went up too. They’ll all get their money, unfortunately, there’s just no way around it, other than giving it all up.
      It really sucks that I only have 1 internet option in my location too.

  15. MF says:

    Fact of the matter is: the economy is suffering because inflation is squeezing so many people these days. When the essentials start costing double or triple the amount, folks can’t continue to spend money on nice extras like streaming services.

    Of course these studios have stupidly responded by raising prices, which will only price out MORE customers. They are digging their own grave.

    • Blithe says:

      We’ve been trained to accept “inflation “ — which can feel enormous, amorphous, and “political “ — even as we ignore the huge profits that many corporations have been making for their executives and investors. What’s squeezing many of us now is not really just about inflation.

      • Saucy&Sassy says:

        Blithe, I agree. I keep waiting for these corporations to understand that they are pricing people out of their product. I figure that once they make less money because people aren’t buying as much, they’ll have to adjust their prices. We’ll see.

  16. Jessica says:

    I cut the cord in 2010 when I moved apartments and cable was no longer included in my rent. I’m really starting to rethink my streaming services. We share Netflix with my bf’s family, and it just stopped working on one of our tvs, but not the other. We’re on a free year of Disney/Hulu/ESPN. My bf did a year of prime and a year of HBO but says he’s not renewing again because of the cost. I think once the wheels start falling off, I’m going to do the rotation.

  17. Nikomikaelx says:

    Who pays for that many streaming services on their own :O In my friend group everyone has one those and we just circulate passwords.

  18. Meghan says:

    I get Hulu/Disney+/ESPN+ through Verizon so I will be interested to see if my phone bill increases. The ads on Hulu are insane, though. I love the Golden Girls but can barely watch an episode since they have ads at the starts, ads after the intro song, then about 3 more ads during the episode, it’s crazy. Also, for whatever reason I can’t watch regular ESPN and a lot of my Auburn games are on ESPN, it pisses me off. I’ll probably always keep Netflix and Peacock for Gilmore Girls and Law and Order/Snapped reruns.

    • Blithe says:

      My Verizon phone bill increased 20% last quarter. I don’t even watch cable, but getting a package has always been less expensive than getting just the services that I actually use.

    • schmootc says:

      And with the ads, am I the only one who hates seeing the same stupid ad again and again? I don’t want to hear about the newest Buick six times in an hour-long show, thank you.

  19. Diana says:

    If they are not careful, they will have people cancelling in huge numbers.

  20. Flamingo says:

    Inflation is really breaking my back lately. The only thing that is not going up is my salary.

    I just canceled my Disney + and Apple TV + subscriptions. There is not enough original content year-round that I like. To make it worth the price hikes. There are 2 to 3 shows at best I watch. I will just wait until the season is over subscribe for one month binge, and cancel.

    Loki, I will see you in two months.

    • Tiffany says:

      It ain’t inflation, it’s corporate greed. The economy is doing well, therefore, corporations raise prices.

      This Republican talking point ain’t it. They will tax us to oblivion and nary a peep.

  21. Mrs.Krabapple says:

    Streaming will just end up add supported like another version of cable TV. Remeber when you could watch YouTube videos without ads, but now there are ads at the beginning and throughout anything on YouTube? That’s streaming’s future.

  22. Rea says:

    The current CEO is the reason why Disney is this way. He made plenty of wrong choices which his predecessor inherited and then he became a sacrificial lamb when he got ousted after people realized how bad Disney had become.

    This was already coming in the works however due to the poor decisions of the current CEO in the past and now they are scrapping for dollars any way possible to make up for the loss in profits.
    Instead of pouring millions of dollars into live actions films which don’t need to be created they should focus on making their existing products economical for the public so it can generate more income by holding a loyal fanbase.

    Seriously with the prices of things rising a lot of people will not re-subscribe to Disney when there are plenty of other streaming platforms that offer more for a more economical price.