In the last few years since the streaming war bubble burst, where growing subscriber numbers were no longer the most important thing to Wall Street, resulting in a major shift across the entire industry to focus on profitability.

Since the return of Bob Iger as CEO in late 2022, the company has gone on a drastic cost reduction program that has saved over $7.5 billion.  As part of these cuts, we’ve seen Disney cut over 7000 jobs around the world, plus the output of original programming drastically reduced, in addition to writing off billions of dollars in underperforming original content.

The drive to get more subscribers to Disney+ and Hulu caused Disney to spend heavily on building its library, chasing subscribers, and creating the tech it needed to do so. 

Disney has been successful in making Disney+ the second most subscribed streaming service in the world, behind Netflix, with Disney+ having 149.6 million subscribers.   In total, Disney has 224.5 million subscribers across its three platforms, Disney+, ESPN+ and Hulu.   

Subscriber numbers have dropped following major issues in India. Disney decided not to spend billions of dollars on the rights to the Cricket league, which backfired. Disney+ Hotstar lost over 20 million subscribers. Now, Disney is merging its Star India business with Reliance as a way of staying in India but taking a backseat in running the business on a day-to-day basis.

With a drastic reduction in original programming, Disney has been able to bring down its streaming losses by 79% in the last year, down to $216 million, and it expects to go into profitability by the end of the year.   The addition of ad-supported tiers and price rises have also helped Disney+ make more money.   Plus an impending account sharing crackdown is also expected to help boost revenue.

Disney+ is set to get a considerable boost in subscriber numbers following a deal with Charter Communications, which has resulted in Spectrum cable customers getting Disney+ included in the bundle, which is estimated to bring in between 5.5 and 6 million subscribers.

Recently, Disney launched Hulu On Disney+ in the United States, offering Hulu content within Disney+ for bundled subscribers. This is expected to help reduce churn and prepare US audiences for a likely eventual merge as consolidation between streaming services becomes more common. Combining Hulu and Disney+ will save Disney money in marketing, content spending, and other costs. Plus, next year, a full version of ESPN will also be available within Disney+ in a similar way to Hulu On Disney+.

Hulu has already proven that its focus on building out its ad-supported tier works. It has one of the highest average revenue per user rates among the different streaming services, as over 90% of Hulu subscribers have an ad-supported tier. This is why Disney is heavily pushing the Disney Streaming Bundles to keep people on the cheaper option, which ironically they make more money from due to advertising revenues.

Disney+ is already the second most popular streaming platform in the world, and recently, Bob Iger has spoken about not really being happy about that, since, no doubt, they want to be number one.  He has said they know what they have to do to get there, improve the user experience, create better content, and be more cost-effective.

The streaming service is in a good position due to its explosive launch, but we will likely see more changes in the coming years ahead as Disney looks to take on Netflix even more, especially now that Disney+ in the US has much more content via the Hulu hub.

However, no doubt, Netflix is going to continue to show why it is the biggest streaming service in the world, spending money on creating new content, licensing content from the studios and trying to make more money, knowing it is under more pressure from the major studios.  

Right now, Disney+ is way behind Netflix on many different levels, but with a combined focus on one single platform, the competition is likely to pick up, which is ultimately better for us as consumers.

Do you think Disney+ can overtake Netflix?  Let us know on social media!

Roger Palmer

Roger has been a Disney fan since he was a kid and this interest has grown over the years. He has visited Disney Parks around the globe and has a vast collection of Disney movies and collectibles. He is the owner of What's On Disney Plus & DisKingdom. Email: Roger@WhatsOnDisneyPlus.com Twitter: Twitter.com/RogPalmerUK Facebook: Facebook.com/rogpalmeruk

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