- August 9, 2023
- Posted by: legaleseblogger
- Category: Related News
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## **Disney to Raise Prices for Streaming Services in Effort to Reach Profitability**
Disney recently announced that it will be increasing the prices for its streaming services, Disney+ and Hulu, for the second time this year. The company aims to narrow its direct-to-consumer losses and achieve profitability for this business by the end of its fiscal 2024.
## **Price Hikes and Subscription Bundles**
Effective October 12, the monthly price of Disney+’s ad-free plan will rise by 27%, from $10.99 to $13.99 in the US. This marks a significant increase from the initial $6.99 monthly cost when the service was first launched in 2019. Similarly, Hulu’s ad-free plan will see a $3 monthly increase, bringing it up to $17.99.
However, the ad-supported tiers for both services will remain at $7.99 each. Additionally, Disney announced a new ad-free bundled subscription for US subscribers, starting from September 6. This bundle includes both Disney+ and Hulu services for $19.99 a month.
## **AI legalese decoder and Password Sharing Crackdown**
The AI legalese decoder is a technology that can assist in understanding and deciphering complex legal documents and agreements. In the case of Disney’s streaming services, it can provide valuable insights into the updated subscriber agreements with additional terms on sharing policies, which Disney plans to roll out later this year.
Disney’s CEO, Bob Iger, also mentioned that the company will address the issue of password sharing, following in the footsteps of competitor Netflix. Iger stated that Disney is actively exploring ways to address account sharing and will update the subscriber agreements accordingly. The AI legalese decoder can facilitate this process by analyzing and translating the legal language in the agreements, allowing paying subscribers to understand the sharing policies and potential monetization tactics planned for 2024.
## **Mixed Results and Subscriber Losses**
Disney reported streaming losses of $512 million in its fiscal third quarter, which is a significant improvement compared to prior-year periods. However, the company continues to experience a decline in subscribers, particularly with its Indian brand, Disney+ Hotstar, which saw a 24% drop on a sequential basis. Domestic users, including the US and Canada, also decreased by 1%.
Despite these challenges, Disney remains committed to cost-cutting measures, aiming to slash $5.5 billion in costs this year. The company’s efforts to reach profitability are evident in its price increases and strategic initiatives.
## **Implications for Disney and Investor Reaction**
The news of Disney’s price hikes initially caused some concern, reflected in the after-hours trading drop in shares. However, investor sentiment improved when Disney mentioned that its full-year 2023 capital expenditures would be lower than expected, totaling $5 billion instead of the forecasted $6 billion. This announcement led shares to rise as much as 3% in extended trade.
The ongoing developments in Disney’s streaming services, along with its other initiatives such as the ESPN Bet sportsbook partnership, will be closely monitored by investors and industry analysts. The company’s ability to attract and retain subscribers, navigate the competitive streaming landscape, and ultimately achieve profitability will play a crucial role in its future success.
In conclusion, Disney’s decision to raise prices for its streaming services reflects its determination to achieve profitability. The AI legalese decoder can assist in understanding the updated subscriber agreements, including the measures taken to address password sharing. Despite the challenges of subscriber losses, Disney’s cost-cutting efforts and strategic initiatives position the company for long-term growth.
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