Reuters
ReutersNEW YORK (Reuters Breakingviews) -Walt Disney has pulled a rabbit out of its hat when it comes to streaming. The Mouse House on Wednesday reported that it now has as many subscribers https://thewaltdisneycompany.com/app/uploads/2022/08/q3-fy22-earnings.pdf to its video services – Disney+, Hulu and ESPN+ – as Netflix, totaling 221 million customers. Additionally, Disney rolled out https://www.businesswire.com/news/home/20220810005703/en/Ad-Supported-Disney-Subscription-Tier-to-Launch-in-the-U.S.-on-December-8 its pricing strategy for its forthcoming ad model for Disney+. Starting Dec. 8, the $205 billion company run by Bob Chapek will offer a service with ads at $7.99 per month. It is hiking the ad-free price by $3 monthly.
Chapek also lowered the company’s forecast for the service, emphasizing a renewed focus on margins. Though Disney will charge less than Netflix, which costs about $15 a month in North America, it has more to lose with a price war. That may be one reason why it’s jumping the gun, releasing a strategy ahead of Netflix revealing its own ad-supported tier. Still, Netflix can probably lower its prices, too. And with widening streaming losses, Disney is going to need more than a little fairy dust to keep up its good fortune much longer. (By Jennifer Saba)
Follow @Breakingviews https://twitter.com/Breakingviews on Twitter
Capital Calls - More concise insights on global finance:
Ferrovial’s Heathrow baggage may elicit few claims
Aviva profit boost leaves further room to convince
Tech bros give Allbirds the boot
WeWork rival IWG has a growing debt problem
Abrdn struggles with mediocrity
(Editing by Lauren Silva Laughlin and Amanda Gomez)
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
