Disney overtakes Netflix in battle of the online streaming services
Disney has overtaken Netflix’s streaming numbers, having racked up a total of 221 million subscribers by the end of the last quarter.
Disney had 221.1 million streaming subscribers at the end of the June quarter (that figure’s combined with Hulu and ESPN subscribers), while Netflix had 220.7 million streaming subscribers.
Disney also announced it will soon be launching an option to subscribers that includes advertising, which will cost $7.99 a month.
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The cost of an ad-free Disney+ subscription will jump to $10.99 in December.
It’s been a difficult year for Netflix, with the streaming giant having had $50 billion wiped off its market cap back in April, just 24 hours after reporting its first loss of subscribers in ten years.
Less than a month later, in May, reports surfaced that suggested Netflix could be set to introduce adverts for certain subscribers as early as this year.
The New York Times reported that employees had been told that a lower-priced tier for subscribers that includes ads could be in action as early as the final three months of 2022.
Just last month, Netflix struck a deal to offer customers a cheaper subscription tier in exchange for allowing adverts.
The news came shortly after the company released financial reports that showed Netflix had been losing subscribers at an alarming rate.
In fact, over a period of time that it had estimated adding 2.5 million subscribers, it ended up down 200,000.
A shareholder press release released in response admitted competitor streaming services had created ‘revenue growth headwinds’.
The company’s executives said: "Our revenue growth has slowed considerably as our results and forecast below show.
"Streaming is winning over linear, as we predicted, and Netflix titles are very popular globally. However, our relatively high household penetration – when including the large number of households sharing accounts – combined with competition, is creating revenue growth headwinds.
"The big COVID boost to streaming obscured the picture until recently. While we work to reaccelerate our revenue growth – through improvements to our service and more effective monetization of multi-household sharing – we'll be holding our operating margin at around 20%."
In April, Netflix CEO Reed Hastings confirmed to The Hollywood Reporter that the company could introduce the lower-tier subscription in order to allow those who don’t mind advertising to pay less for their subscription in exchange for seeing commercial messages.
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Aisha Nozari