Disney+ was the third most popular video-on-demand platform in the country last year. In March the company increased the cost of its subscription by 30%. Now, Disney confirms it is putting an end to password sharing.
In April 2023 Netflix announced in its first quarter earnings call that it was putting an end to password sharing. It instituted the changes a month later, and by October had announced a bump of 8 million new subscribers that it attributed to cracking down on users sharing passwords.
Having seen the impact the changes had on its streaming rival’s bottom line, Disney is now following suit.
“In June we’ll be launching our first real foray into password sharing,” Disney CEO Bob Iger said in a post-earnings interview this week. “Just a few countries in a few markets, but then it will grow significantly with a full rollout in September.”
Iger did not reveal which markets would be impacted in June and which would be a part of the September rollout. Forbes Australia contacted Disney Australia for confirmation but did not receive a reply by the time of publication.
The boomerang CEO did disclose that international subscribers of the US based business were key to its bottom line, however.
“We launched Disney streaming just over four years ago. It’s still a nascent business in many respects, very successful when you look at the number of global subs that we signed up right away and obviously since then,” says Iger.
The Disney+ service rolled out in Australia and the US in 2019. It is the second-largest streaming platform globally, but the third-largest in Australia according to 2023 Telsyte data.
“Netflix had a 10-year head start on us. And, when you think about Netflix and you think about what they have done on password sharing – which we’re going to get to later this year – it won’t impact us until 2025.”
The delay from the 2024 password crackdown is due to the initial dropoff from subscribers, and the lag in reporting new subscribers in a subsequent earnings report.
Iger says the respect he has for Netflix goes beyond preventing password sharing.
“Netflix is the gold standard in streaming. They have done a phenomenal job in a number of different directions. I actually have a very, very high regard for what they have accomplished,” Iger told CNBC.
The 73-year old CEO returned to the company five months ago and has been locked in a proxy battle with activist investor Nelson Peltz since. The proxy was settled this week with Iger coming out on top.
With that behind him, Iger is free to focus on other areas of the vast Disney empire. He says producing local content for international subscribers is a priority.
“We have to program more smartly, particularly outside the United States. We need to pick the markets where we can really move the needle and program with really strong local programming. We have had some success there. We need more success.”
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