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Walt Disney has pulled a rabbit out of its hat when it comes to streaming. The Mouse House on Wednesday reported that it now has as many subscribers to its video services – Disney+, Hulu and ESPN+ – as Netflix, totalling 221 million customers.
Additionally, Disney rolled out its pricing strategy for its forthcoming ad model for Disney+. Starting Dec 8, the $205 billion company run by Bob Chapek will offer a service with ads at $7.99 per month. It is hiking the ad-free price by $3 monthly.
Chapek also lowered the company’s forecast for the service, emphasising a renewed focus on margins. Though Disney will charge less than Netflix, which costs about $15 a month in North America, it has more to lose with a price war. That may be one reason why it’s jumping the gun, releasing a strategy ahead of Netflix revealing its own ad-supported tier. Still, Netflix can probably lower its prices, too. And with widening streaming losses, Disney is going to need more than a little fairy dust to keep up its good fortune much longer.
The author is a Reuters Breakingviews columnist. The opinions expressed are their own.