Sumary of Can a New Bundle Help Disney+ Keep Growing?:
- Walt Disney (NYSE:DIS) is looking to recover from a quarter where it added just 2.1 million Disney+ subscribers.
- The streaming service has become a major focus for investors as the media company is planning to invest heavily in its direct-to-consumer offerings over the next three years before it expects they’ll turn a profit.
- It’s more lucrative for Disney to force distributors to carry the network for all subscribers than it is to sell the network directly to only those who watch it.
- While some of those likely already subscribe to Disney+ or ESPN+, Disney will instantly add millions of subscribers for the services with the upcoming change.
- Disney is trying other tactics to add new signups for Disney+ as well, including a promotion for new and existing subscribers to pay just $1.99 for one month of the service for its anniversary earlier this month.
- First of all, Disney+ already has over 118 million subscribers, so four million subscribers paying significantly less than the average in the U.S. won’t have a huge impact.
- Second, Disney still gets a lot of subscribers from its low-priced Disney+ Hotstar service in India, which has a much bigger impact on ARPU. Disney’s taking a risk There’s significant risk in asking Hulu + Live TV subscribers to take the entire bundle of Disney streaming services.
- The virtual pay-TV service is designed to have low switching costs — there’s no annual contract, so subscribers can come and go as they please.