Walt Disney’s ad-free streaming services are set to become more costly, while the media giant is also taking measures to curb password sharing.
Disney announced on Wednesday that it will be raising the price of its ad-free Disney+ subscription by $3 per month, a 27% increase to $13.99. Additionally, the monthly fee for the ad-free version of Hulu will increase by $3, or 20%, to $17.99.
The new prices will take effect on October 12th.
The decision to increase prices and discourage password sharing comes as streaming networks experience a slowdown in subscriber growth. Disney+ alone lost around 300,000 subscribers in the U.S. and Canada since April, according to the company’s earnings report.
Disney CEO Robert Iger stated that the demand for its ad-supported streaming networks from marketers is stronger than that for traditional television and cable platforms.
“The advertising marketplace for streaming is picking up,” Iger remarked during a conference call. “It’s healthier than the advertising marketplace for linear television.”
He further added, “We believe in the future of advertising on our streaming platforms, both Disney+ and Hulu, and we’re implementing our pricing strategy to encourage more subscribers to switch to the ad-supported tier.”
Disney’s Crackdown on Password Sharing
Disney also revealed its plans to crack down on password sharing, although specific details about how it plans to do so were not disclosed. The company is following in the footsteps of Netflix in its effort to prevent subscribers from sharing their account details with others.
“Regarding password sharing, we already have the technical capability to monitor much of this,” Iger explained during the conference call. “What we do not know is how much of the password sharing, as we essentially eliminate it, will convert into subscriber growth.”
Some analysts have questioned whether price hikes and cracking down on password sharing can truly lead Disney to sustainable growth. Insider Intelligence analyst Paul Verna noted in a statement that these actions are unlikely to appease investors seeking clarity on the company’s strategy for its streaming services and TV networks.
—With reporting by the Associated Press
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