Disney+ Streaming Popularity Surges After Controversial Bob Iger Merger

in Disney, Movies & TV

Bob iger, the ceo of disney, with a focused expression, superimposed on a blue background next to the disney+ logo in white.

Credit: Inside the Magic

Disney+ streaming has cost the Mouse billions of dollars since its launch in 2019, but CEO Bob Iger‘s new, controversial strategy finally seems to be paying off.

The image features a large assortment of movie and TV show posters, forming a colorful background mosaic. In the center, prominently displayed, is the Disney+ logo, indicating that the platform offers a wide variety of content.
Credit: Inside the Magic

The entertainment industry is currently in a crisis over how to deal with the increasing evidence that streaming content, which the major studios embraced with open arms, does not actually seem to make much money. Netflix became a huge economic force based on streaming shows like Stranger Things and Squid Game, so The Walt Disney Company, Warner Bros., Paramount, and all the other majors assumed they would be able to do the same.

It hasn’t turned out that way. Disney+ was launched with a huge wave of promotion, exciting new shows like The Mandalorian and Wandavision (plus the promise of virtually every piece of Disney content ever made), and an industry-low subscription price.

We’ll let Bob Iger himself say what happened next: “[T]he losses were around $4 billion a year. It was clear that that was not sustainable and not acceptable, and the goal was first, let’s reduce those losses.”

Bob Iger superimposed in front of the Disney Pictures logo
Credit: Disney

Related: Disney+ Flop Wildly Over Budget, Franchise Canceled Early

Since then, Disney has struggled to turn its proprietary streaming service into a source of profit rather than a colossal loss that makes Star Wars fans incredibly angry.

The platform finally managed to get into the black for the very first time earlier this year, but it says something about the current state of Disney that the announcement that Disney+ had made money actually sent the company’s stock price plummeting for fear of how badly it will do next quarter.

Disney has raised the price of subscriptions, deleted swathes of low-performing, high-residual content, and stuffed ads anywhere it possibly can in an effort to try to turn a streaming profit. While it still can’t do that consistently, it is now being reported that Bob Iger’s controversial move to merge the service with Hulu is finally seeing results in reducing the amount of people who cancel their streaming subscriptions (per Business Insider).

A line graph titled "Disney Churn (Standalone vs. Bundle)" shows churn rates from January 2022 to March 2024 for ESPN+ (orange), Hulu (green), Disney+ (purple), and the Disney Bundle (blue, dashed). Churn rates for standalone services are higher than for the Disney Bundle.
Credit: Antenna

Disney+ and Hulu’s content catalogs were merged earlier this year (after a beta test), which initially caused controversy for parents concerned about the sudden influx of R-rated and mature-themed TV shows and movies on the previously family-friendly service.

Now that that speed bump seems to have passed, it turns out that subscribers who have more than one service in a bundle, such as both Disney+ and Hulu, are far less likely to drop their subscriptions, a number referred to as “churn.”

Related: Hulu To Buy ‘Family Guy’ and Take Beloved Show off Television

Business Insider says, “Putting Hulu shows and movies on Disney+ broadens the streamer’s offering, thereby reducing its reliance on its Star Wars and Marvel franchises. It also encourages customers to stay subscribed, even if they’re not consuming as much Star Wars or Marvel content. The Disney bundle has proven to drastically lower churn, according to research firm Antenna. Subscribers to the bundle are far less likely to cancel than customers with a stand-alone service.”

It turns out that Bob Iger’s plan to take every Disney streaming service, including Hulu and ESPN+, and turn them into one very expensive platform to rule them all might actually make sense after all.

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