Disney + will increase its US pricing to $ 7.99 per month in the US as the company invests heavily in more original programming and seeks to significantly expand its international subscription footprint.
The price increase, which will take effect on March 26, 2021, was announced on Thursday as part of a four-hour virtual presentation for investors. The new price of $ 7.99 per month or $ 79.99 per year for an annual subscription means the Disney + package, which includes Disney +, Hulu, and ESPN +, costs more too. The package is now priced at $ 13.99 per month.
The move comes amid a remarkable growth rate for the burgeoning streaming service, which has quickly become one of the most successful examples of a traditional media company's transition to streaming.
Disney's direct customer business remains the most pandemic-proof part of its business as personal parks and experiences, theater revenues, and traditional television advertising have all been negatively impacted by the ongoing Covid-19 pandemic. And Disney +, which only debuted in November 2019, is still seeing remarkably early growth.
The streaming service had 86.8 million subscribers as of Dec. 2 – an increase of more than 13 million subscribers in the two months since Disney announced that the streamer released 73 million subscribers in October. Approximately 30% of these subscribers come to service through Disney + Hotstar – a sign of the brand's strength in certain international markets.
The company has 137 million subscribers across all of Disney's streaming properties. In addition to Disney +, the largest, there are 38.8 million subscribers to Hulu and 11.5 million subscribers to ESPN +.
"Needless to say, Disney + exceeded our wildest expectations," said Bob Chapek, Disney CEO, Thursday. “This success has strengthened our confidence in our further acceleration towards a DTC-First business model. More importantly, the Walt Disney Company has ushered in a new era of providing consumers with truly exceptional entertainment based on our world-renowned brands and franchises. "
Disney expects 230 to 260 million Disney + subscribers by fiscal 2024 – a staggering new forecast that's about three times higher than the company's original projections, which it first offered about a year ago. Overall, Disney hopes to have between 300 and 350 million subscribers for all streaming services by fiscal 2024, said CFO Christine McCarthy.
Those massive numbers are putting pressure on the company to offer new programs that will keep customers coming back time and time again. The stress is particularly great in his attempts to address viewers without children. Disney hopes the lineup of upcoming shows will help it thrive on all of these fronts. Over the next few years, Disney + will have 10 Star Wars series, 10 Marvel series, 15 live-action and animation projects from other Disney objects, and 15 live-action and animated films, said Kareem Daniel, chairman of Disney’s media chief and Entertainment distribution. (Daniel was promoted in October as part of a major streaming-centric reorganization.)
"As streaming has quickly become a preferred mode of consumption, we are prioritizing our DTC platforms for both the distribution of our content and our increased investment in original programming for Disney +, Hulu, ESPN + and our upcoming star brand for general international entertainment," said Daniel. "A significant increase in production for these services will not only accelerate the growth of our DTC business, but also cement our deep and very personal relationship with consumers worldwide."
That significant and accelerated expansion is evident in the number of new projects announced on Thursday, many of which are aimed at older viewers. The company unveiled dozens of new projects from new Star Wars series, including titles like Rangers of the New Republic, Ahsoka and Lando, new Marvel series like Secret Invasion, Ironheart, Armor Wars and a Guardians of the Galaxy Holiday Special. There are also sequels, prequels, and spin-off series, as well as films like The Lion King, Hocus Pocus, The Mighty Duck, Moana, and more. The company has an initial preview of the first footage and detailed new program lineups, including a key contract with ESPN to bring SEC college football games to ABC and ESPN + as early as next year in 2024.