The Walt Disney Company has been making some questionable decisions lately. The entertainment giant spent the better part of a century establishing itself as a brand that prides itself on providing quality content and service for its consumers. However, many of its announcements this year skew more in the realm of draining its audience financially dry while providing little incentive to allow it. CEO Bob Iger’s decision to raise streaming prices this fall towers at the peak of these crimes against consumers.
Disney Raises Streaming Subscription Costs
Disney+ launched with a relatively light amount of content back in 2019. However, this was offset by the company advertising it as a cheaper alternative to other streaming platforms, such as Netflix. Originally only setting users back $6.99 per month with no ads, the cost was a drop in the bucket for access to Disney’s broad library.
However, Disney has not stuck to its ideals in its quest to make Disney+ profitable. Over the years, the company has raised prices on its customer base several times. Late last year, it hiked the Disney+ subscription cost to $10.99 per month while offering an ad-supported option for a higher price than its original launch fee.
This culminated in the recent announcement that Disney+ will be raising the price of its ad-free option again to $13.99 per month come October 12. This is a huge 27% increase to the current price. Furthermore, the company has done zero work to justify the increase. Iger claims it is to keep up with competitors, but people expect more when prices increase. The current state of Hollywood and Disney’s future plans will have the opposite effect when the hike takes hold, and consumers have little incentive to entertain it.
Less Bang for Your Buck
Hollywood is captured in a huge dilemma right now. Actors in SAG-AFTRA have joined writers in a heated strike against major studios. Disney finds itself in the center of this battle. While it rages on, absolutely no work is being done on any series, movies, or projects in the pipeline. Not having to pay actors or writers saves the company a ton of money. However, it comes with the drawback of content delays and uncertainties.
Consumers will definitely take note of this when making any decisions to keep paying for Disney’s streaming services. The company is currently experiencing fewer operational costs to provide content right now while also having no content to provide. In what world does this warrant a price increase? If Disney can’t keep up with consumer demand for consistent streaming content, why would anyone stick around and pay for it on a monthly basis? While some have accepted current pricing, hiking that subscription cost now is a strange financial decision that will more than likely backfire.
To fuel the fire, Iger has also detailed his plan to improve the quality of upcoming Disney projects. Whenever the writers and actors return to work, Disney’s plan of action is to stop providing as much content and focus more on quality. This summer, it has also purged a good chunk of content from its services. So, not only is the company dealing with an uncertain timeframe of delays and setbacks, but it intends to put less material on its streaming platforms to consume. While this arguably might help with oversaturating its audience, it is the opposite of justifying a price increase right now.
Watching the Disney World Burn
It will be interesting to see what happens to Disney+ come October 12. Calls to cancel the streaming platform have already taken off on social media. This has been exacerbated by the decision to crack down on password sharing. Disney has had trouble keeping subscribers even with a steady flow of content. Increasing subscription costs now is an insane way to try and increase the appeal of its services, especially with so much uncertainty surrounding its projects.
The most likely outcome is more consumers abandoning the platform and justifying the costs for competitors with more bang for their buck (such as Amazon Prime Video, Max, or Paramount Plus). Disney has done little to win over its audience in this age of streaming, and many of its tactics seem to just exploit its base instead of nurture it.
