Key Takeaways
- Disney+ will end password sharing across multiple households & introduce a new paid sharing tier.
- Disney’s Q3 earnings show profit from Disney+, Hulu, & ESPN+ for the first time.
- The crackdown on password sharing may lead to churn in subscribers given recent price hikes.
It was nice while it lasted.
We’ve known since February that Disney+ and Hulu have been working on a plan to crack down on password sharing for multiple households, and now it looks like they’re ready to roll out a big update in September that will end this practice for good, according to CEO Bob Iger. Though it hasn’t gone live in the US yet, the crackdown has been rolling out in other territories, and Iger said that the company has “had no backlash at all,” to the changes where password sharing has been removed.
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A new sharing tier will go live soon
Similarly to Netfix, Disney has said that their streaming services are intended for use by one household only, and they will be launching a new paid sharing tier for those who want to share their account outside of their house, similar to the $7.99 per month sharing account fee that Netflix charges. Unfortunately, pricing has not been revealed for this new add-on, but it may be a tough pill for users to swallow, as subscription fees for Disney+ and Hulu just went up yesterday.
When asked about the inevitable churn that the price hikes and end of password sharing could bring, Iger says he’s “not concerned” about losing subscribers due to these changes, adding that streamers will see increased value from Disney’s streaming services as the company is adding ABC News Live and curated playlists.
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But can it keep up the momentum?
Like other streamers, Disney has struggled to turn a profit with its streaming services. However, in its Q3 earnings results, released today, the company reported making $47 million off Disney+, Hulu, and ESPN+, meaning that for the first time ever, Disney’s streaming business was actually profitable.
In addition, the ‘s streaming services showed some subscriber growth as well with both Disney+ and Hulu adding just under 1 million subscribers in the US and Canada, bringing their subscriber totals to 54.8 million and 51.1 million, respectively.
Will these streamers stay in the positive as we head into the fourth quarter? The crackdown on password sharing should see some new account creation, but the price hikes could offset this with inevitable churn, so it’s hard to say for sure.
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