Editor’s note (Aug. 22): This story was updated to make clear that Disney surpassed Netflix in subscriptions, rather than individual subscribers. Disney had 221 subscriptions across its three streaming services—Disney+, ESPN+, and Hulu—compared to Netflix’s 220 million subscriptions.
Disney became the recession-defeating success story everyone needed when it posted strong third-quarter results (pdf) on Wednesday. Disney’s overall streaming portfolio, which includes Disney+, ESPN+, and Hulu, has reached 221 million subscriptions worldwide, blowing past Netflix’s 220 million.
However, it’s worth noting that Disney counts its bundle subscribers (combinations of Disney+, Hulu, and ESPN+), which may in some cases represent one household, as several subscriptions. “Subscribers to the SVOD Bundle are counted as a paid subscriber for each service included in the SVOD,” reads Disney’s third quarter earnings report. Disney does not disclose how many distinct subscriber households it has as a subset of its overall subscription base.
The bulk of Disney’s increase came from Disney+, which jumped from 138 million subscribers in May to 152 million. Hulu and ESPN+ also saw mild bumps in viewer numbers, growing from 45.6 million subscribers to 46.2 million and from 22.3 million to 22.8 million respectively.
Ads are coming to Disney+ and Netflix
Despite the looming threat of subscription fatigue from viewers, the company is nevertheless hiking the price of Disney+ in conjunction with the rollout of its new ad-supported tier. Starting on Dec. 8, the ad-supported version of Disney+ will cost $7.99, and the “premium” ad-free version, which previously cost $7.99, will cost $10.99.
That price puts Disney+ premium roughly on par with the entry-level Netflix subscription plan at $9.99. But since Netflix’s basic plan doesn’t offer high-definition video, many subscribers opt for Netflix’s standard plan, which streams at 1080p and costs $15.49. That price disparity between Disney+ and Netflix is likely one of the reasons the latter reported a loss of about 1 million subscribers in July. Netflix will launch its own ad-supported tier in early 2023; the subscription price of that service is not yet known.
One factor that may continue to boost Disney’s overall subscriptions across its various streaming platforms are its bundle options. For $9.99, viewers can get Disney+ and Hulu together with ads; for $19.99, they can get ad-free access to both services (along with an ad-supported version of ESPN+).
Disney+ may win the long game thanks to its movie theater might
Disney’s overall results don’t reflect the stunning success of Hulu’s Prey, the Predator prequel, which debuted on the platform last week and is, according to the company, the number one premiere on Hulu ever. And the growth of Disney+ proves that Disney’s superhero-led strategy of theatrical releases that complement original Marvel streaming series is working so far.
At the box office, Disney has continued its run of theatrical success this year with Doctor Strange in the Multiverse of Madness and Thor: Love and Thunder respectively becoming the third (nearly $1 billion) and sixth-highest ($700 million) grossing movies of the year globally.
Disney also has a strong slate of content to round out the remainder of 2022, including I Am Groot (which debuted on the same day as the earnings release), She-Hulk: Attorney at Law, Star Wars: Andor, and The Guardians of the Galaxy Holiday Special on Disney+, as well as the highly-anticipated theatrical release of Black Panther: Wakanda Forever.