In the third quarter of 2023, Disney, the media titan, disclosed its financial results, indicating a substantial setback in its digital streaming sector. The company witnessed a continuous downtrend in its subscriber base, a pattern that commenced in the last quarter of the previous year and appears to remain unbroken.
The company’s streaming platform, Disney+, reported an alarming 7.4 percent decline in its subscriber base during Q3, amounting to 146.1 million subscribers. In particular, the streaming service Disney+ Hotstar experienced a substantial loss of 24 percent of its customers.
The Turnaround Strategy
Despite the streaming setbacks, Disney CEO Bob Iger expressed optimism about the company’s future. According to Iger, the key to Disney’s recovery lies in three core businesses: film studios, theme parks, and digital streaming. These sectors, Iger asserts, are closely interwoven with the company’s brands and franchises and will drive significant growth and value creation over the next five years.
In an attempt to counterbalance the losses, Disney has publicly announced a price increase for Disney+ from October 12. The ad-free service will now cost $13.99 (USD) per month. Additionally, Disney offers a combined Disney+ and Hulu subscription for $19.99 (USD) per month.
Password Sharing Restrictions
In line with Netflix‘s strategy, Disney also plans to implement restrictions on password sharing. This move is expected to curb unauthorized access and account sharing, thereby boosting the company’s revenue.
The Role of Film Studios and Parks
Iger believes that Disney’s film studios and parks will play a crucial part in the company’s recovery strategy. However, the Q3 results indicate that there’s still a long way to go.
Disney’s theme parks outside the United States reported satisfactory performance. However, Disney World in Florida saw a noticeable drop in visitor numbers.
Many of Disney’s films, which were anticipated to be box office sensations, underperformed. This led Iger to emphasise the company’s focus on enhancing the quality of its upcoming films.
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