12 million subscribers left Disney’s streaming service in the second quarter of the year. The media giant plans to cut expenses.
The Walt Disney Company, or more familiarly Disney, told about the challenges in its interim report. Managing director Bob Iger’s piloted entertainment giant has lost almost 12 million streaming subscribers in April-June.
At the end of January–March, the company’s Disney+ service had just under 158 million subscribers worldwide, compared to just over 146 million now. The majority of the April-June subscriber base is from the Indian market, where the company lost the broadcast rights to popular cricket matches earlier this year.
Disney’s competitor Netflix, on the other hand, recently said that the number of subscribers to its service increased by almost six million after the company announced that it would limit the sharing of usernames around the world.
On the whole, Disney’s results were on a satisfactory rise, but still fell slightly short of analysts’ forecasts. Disney’s stock rose three percent after the review.
The drama related to the management ladder of the last years is behind us, when Iger first gave up the CEO position in 2021 in anticipation of retirement. He was replaced Bob Chapek.
However, in 2022, the company’s board of directors pressured Chapek to leave and Iger was called back to the position. Iger had to take care of washing for a couple of years until a suitable successor was found, but in July Disney and Iger signed a contract until 2026.
Prices up, costs down, says Iger
Iger, CEO of the media industry, who managed the big Marvel and Lucasfilm deals for Disney, said the company was operating under “challenging conditions”.
The company plans to turn its streaming service into a profitable one by 2024.
According to Iger’s vision, this happens by extracting more power from the entertainment machine. The “quality of Disney’s films must be improved”, the ESPN sports channel is to be reformed in the direction of live streaming, and at the same time to resolve the ongoing strike in the film industry.
Iger said that Disney remained on target for the 5.5 billion in spending cuts promised in February. The cuts are accompanied by price increases: the price of the ad-free US version of the Disney+ service will be increased by 27 percent to $13.99 per month.
At the same time, it is planned to start selling advertisements for the European and Canadian versions of the streaming service. Like Netflix, the company plans to tackle user accounts shared by several people over the next year.
Iger’s power cycle will also appear in Disney’s publications. Their number is to be reduced, and the costs of the productions to be carried out are to be cut.