Walt Disney Company had an earnings call this week disclosing that Disney Plus reflected a loss of more than 2 million subscribers. This information reflects the last quarter of 2022.
However, thanks to its other companies, especially the theme parks, the conglomerate still pulled through with a robust earning that even went above estimates from Wall Street.
The 2.4 million subscribers that Disney Plus lost is the first decline in subscribers for the streaming service since its release in 2019. Though the company as a whole still had positive numbers, the subscribers lost equates to a loss equivalent to that of a fortune.
Disney Plus Means to Win Back 2 Million Subscribers
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Collider reports possible causes of the steep decline. Disney CEO Bob Iger states that the conglomerate is entering a time of notable change. In his announcements on Wednesday, he said:
After a solid first quarter, we are embarking on a significant transformation, one that will maximize the potential of our world-class creative teams and our unparalleled brands and franchises. We believe the work we are doing to reshape our company around creativity, while reducing expenses, will lead to sustained growth and profitability for our streaming business, better position us to weather future disruption and global economic challenges and deliver value for our shareholders.
Key terms from the statement “significant transformation” could also mean the changes that have started to take place upon his return as the CEO last year. ‘Maximized potentials’ could mean making use of all possible intellectual properties for future content.
Ways to reduce expenses also require a degree of creativity. But the immediate step that they took, which was laying off 7000 employees, equivalent to 3.2% of its human resource, is pretty disheartening. I hope they at least did well by those 7000 employees with their own families to support.
So many factors affect consumer behaviour. The fact that streaming service is at their most competitive point now also does not help. When Disney Plus initiated its service, it highly banked on the classic libraries that people have always loved through the years.
Of course, overcoming of the period of excitement and the satisfaction that subscribers have already watched and re-watched their favourite childhood movies would leave them looking for what’s new.
People loved the rejuvenation of interest in Lucasfilms’ Star Wars when The Mandalorian premiered. They can’t get enough of Baby Yoda, who eventually they introduced as Grogu. It paved the way for more Star Wars series, and perhaps a lot more is still to come. However, after years of absence on the big screen, fans may have a growing disinterest in the current development of the galaxy far, far away.
The newest original series from Lucasfilms’ Star Wars, Andor, has commendations from critics and audiences around the world, but the translation to subscription might not have turned out as well as they hoped. The story of the Rebellion before Episode IV: A New Hope still has its second season coming. And for that, people are still interested in staying on Disney Plus.
More importantly, the crowd-favourite series involving Din Djarin and his foundling Grogu is coming on March 1. Hopefully, subscriptions will fare better in the first quarter of 2023 for the streaming service.
Let us not forget the other strong carrier of the service: Marvel Studios. By the MCU library alone, people have enjoyed the streaming service and are happy to stay, knowing that titles are definitely on their way. Just recently, the sequel Black Panther: Wakanda Forever became available starting February 1.
Even though a lot of people were disappointed by the She-Hulk series, there are still other titles that caught their interest. The Holiday specials Werewolf By Night and Guardians of the Galaxy Christmas Special were very well received by Marvel fans. And like Lucasfilm, Marvel Studios has more coming up on their slate.
Lack Of New Releases May Have Cost Disney Plus 2.4M Subscribers
Credit: Marvel Studios
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There is also the possibility that people didn’t prioritize streaming during the last quarter. For one thing, they had the holidays and because CoViD restrictions are getting more lenient in many countries, they have opted to go out. Evidently, Disney parks and recreations raked in much of the company’s revenue.
But looking at this from a different perspective, where the decline of subscribers is actually a result of a previous set of decisions the company made, makes one think again. In May 2021, we reported some trouble happening within the walls of the House of Mouse. Certain administrative decisions, from the time of Bob Chapek, do not sit well with the creatives of the company. These specific creatives are Marvel Studios and Pixar.
The reported disagreements also pit Disney’s Bobs (Iger and Chapek) against each other. Fast forward to the end of 2022, and Iger is back as the CEO. Although, this time, it is specified that he stays on for a limited time and in the mission to prepare the successor.
Nevertheless, it feels as though it’s either an overhaul or a reset of the company to revert to its creative content roots. I’ll be relieved by that.
What do you make of this news? Do you think there is more to the reasons why Disney Plus lost so many subscribers? Let us know your thoughts in the comments below.
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