The Disney+ platform is facing a significant decline in the number of subscribers. Streaming ended the second quarter with 146.1 million subscribers, up from 158 million in the first three months of the year.
The biggest impact suffered by The Walt Disney Company was in the Asian market. More than 3.8 million people canceled their subscriptions in the region served by Disney+ Hotstar (India and Indonesia). The main reason for the regional decline was the loss of the Indian Premier League rights.
exaggerated optimism
Bob Iger, CEO of the company, admitted that there was an illusion in the company with the initial success of the service, which launched in November 2019. At the time, the debut of Disney+ was an absolute success and a big novelty in the market , which had yet to receive competition from HBO Max, Paramount+, Peacock and other newer platforms. With the new market setup, just three years on, the platform has seen a reduction in the number of subscribers, going in a completely opposite direction to what executives expected.
During the market presentation of Disney’s quarterly earnings, Iger commented on the matter and reinforced the company’s inability to be fooled by the exponential growth of the platform: “One of the things that happened was that we were intoxicated by our own subscription growth… We said 60 to 90 million subscribers in five years…we passed that in one year and suddenly everyone was working with this meteoric rise and [acreditando] that would continue. We leaned into that because it seemed like that was the primary metric we would be measured against.”
Changes in perception of success
The metric for the success of a streaming service has also changed. Success has ceased to represent the number of signatures and has become profit, as in the good old Economy of all time. Platforms that have invested billions to make millions, like Disney+ itself, are adjusting their accounts. The cut in investments aims to change the paradigm: to qualify programming rather than quantify it.
To make matters worse, the film division, which has always found a way to pay the bills, has been racking up losses this year. Only “Guardians of the Galaxy Vol. 3” and “Avatar: The Path of Water” (released last year) were cited as recent successes by Iger in his quarterly market presentation.
The news affects not only the content available on the platform, but also the lives of over 7,000 employees who will be fired. According to Bob Iger, the company needs to save about $5.5 billion in order not to feel the burden on its finances.
Source: Terra
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