Disney joins Peacock, Max and others in raising prices. Here's what it means for your subscription costs.

Disney (DIS) raised the prices of its various subscriptions on Thursday, highlighting a trend that has gained momentum over the past year as media companies focus on improving profitability.

Disney first announced the price increases in August, revealing increases across its various Disney+ and Hulu plans. These changes are set to take effect alongside the Disney+ debuts of Marvel's “Agatha All Along” and Pixar's “Inside Out 2.”

Most plans increase subscription costs by $1 to $2 per month. Hulu Live TV plans will increase more significantly, increasing by $6 per month.

The price increases come as Disney seeks sustained profitability in its streaming business, which turned a profit for the first time in the quarter ended June 29. The company also plans to add new features to the Disney+ app, such as access to ABC Live and a playlist with content for young children.

“Every time we've taken a price increase, we've had only modest churn,” Disney CEO Bob Iger said on the company's third-quarter earnings call in August. “Nothing that we would consider significant.” He added that the goal of streaming is to “increase engagement on the platform,” hence the new features and bundling options.

Other streamers have adopted similar strategies. Before Disney's announcement, Peacock, Comcast's (CMCSA) flagship streaming service, implemented price hikes in July, just before the 2024 Paris Olympics, after raising prices for the first time last summer.

And in June, Warner Bros.' (WBD) Streaming platform Max increased prices on its ad-free streaming plans, including ahead of key programming: the debut of the second season of its blockbuster prequel “Game of Thrones” and “House of the Dragon.”

But Wall Street analysts warn that a sustained surge could result in more subscribers canceling their plans and churn rates at high levels.

“No-ad subscription prices are starting to go through the roof,” Bank of America analyst Jessica Reif Ehrlich previously told Yahoo Finance. “For this reason, we expect consumers to abandon multiple streamers and perhaps rotate a bit more depending on the content cycle.”

To counteract fickle consumers, competing platforms are now bundling their services. As WBD CEO David Zaslav told investors in May, “There is more strength together.”

Meanwhile, despite recent consumer frustration, password-sharing crackdowns have become a popular choice in the race for profits.

The story continues

Disney+ introduced the practice in the U.S. and other regions last month, offering households the option to add an “external” additional user at a discounted rate.

The crackdown reflects the strategy of Netflix (NFLX), which began implementing its password sharing crackdown for U.S. subscribers last May after first announcing the initiative in October 2022. WBD's Max has also joined the trend, announcing that the company will be cracking down on account-sharing later this year.

Alexandra Canal is a senior reporter at Yahoo Finance. Follow her on X @allie_canal, LinkedIn, and send her an email at [email protected].

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