Marvel and Star Wars keep Disney+ afloat amidst Hotstar subscriber slump
The global entertainment conglomerate, has been operating a variety of streaming platforms that cater to a diverse range of audiences worldwide. However, House Mouse has faced a 2% subscriber slump following the large exodus of subscribers from Hotstar in India and Southeast Asia.
Having lost lost 4.6 million subscribers during this second quarter period, Hotstar's prospects remain bleak as the streaming service grapples with the recent termination of its licensing agreement with HBO. The entertainment titan promptly withdrew its entire catalog from the Indian platform, with Viacom18 securing the rights to HBO and additional Warner Bros content. Industry analysts forecast Hotstar's subscriber loss to escalate, potentially reaching an additional 7 million by year-end.
Ugly Disney Q2 earnings report:
— cartoonbrew.com - Animation News (@cartoonbrew) May 10, 2023
Lost total of 4 MILLION Disney+ subscribers in last 3 months
300K subscribers lost in US/Canada
Biggest subscriber drop for Disney+ Hotstar in India
Disney+ Hotstar just lost HBO content on Mar. 31 so another big drop possible next quarter pic.twitter.com/RKSxqGtyNA
Since October 2022, Hotstar's total subscriber loss has reached 8.4 million, according to Disney’s earnings reports. Despite this decline, Hotstar still has about 53 million subscribers, with India being its largest market. However, the issues for Disney extend beyond subscriber attrition. The company is also witnessing reduced revenue from those who maintain their subscriptions to the streaming service. Hotstar’s average revenue per subscriber fell from 74 cents to 59 cents in the quarter ending March.
Disney is planning to improve the profitability of its streaming business by combining Hulu content with Disney+ in a single app. The CEO of Disney, Bob Iger, announced that they will create a unified experience for users within the United States. As part of this change, the price of Disney Plus's ad-free plan, currently priced at $10.99 per month, will be increased. The new streaming option is expected to be available by the end of 2023, with more details to be announced later.
A platform combining Hulu and Disney+ will launch later this year. pic.twitter.com/lvTUoFUObv
— The Hollywood Handle (@hollywoodhandle) May 10, 2023
Currently, Disney is considering whether to purchase Comcast's 33% ownership stake in Hulu. This stake was agreed to be sold to Disney in January 2024. Both companies had previously agreed that Hulu would have a minimum value of $27 billion, making Comcast's stake worth at least $9 billion. However, Disney might be hesitant to pay this amount if the economy remains unstable.
Disney faces a unique challenge in relying on expensive production of shows from popular franchises like Marvel and Star Wars to attract viewers. Marvel alone has released eight exclusive series with a total of 57 episodes on Disney+ in the past two years.
Despite the challenges faced by Disney, the company also reported significant growth at its theme parks during its second fiscal quarter. Disney+ losses narrowed as price increases helped offset the loss of 4 million subscribers, according to Disney's latest earnings report.