Following the introduction of Star, Disney+ has managed to decrease its churn rate -- the rate at which people unsubscribe to the platform -- despite raising its monthly subscription cost.
Star, a new channel under the larger streaming platform, is geared toward adults and mature audiences, with content from Disney as well as FX, 20th Century Studios, 20th Century Television, Searchlight Pictures and ABC Signature. This means that shows like Grey's Anatomy and Family Guy and movies like Deadpool have made their way onto the streaming platform, with the range of Disney+'s library effectively doubling as a result. With the addition of Star, Disney+ has raised its monthly costs from $6.99 to $7.99 in the US.
"Of course, these were our first price increases since we launched, we're extremely pleased with how the market reacted to both," said Disney CEO Bob Chapek during an investor quarterly financial results call. "We've seen an improvement in our churn rate. So we seem to be fairly resilient to those price increases, and as such, I think it makes us feel relatively bullish going forward."
The addition of Star was due to the number of lost subscribers following the conclusion of major Disney+ shows featured on the platform and a lack of content for older audiences. While shows like WandaVision and The Falcon and the Winter Soldier have drawn considerable numbers for the platform, the lack of a wider streaming catalog beyond family-friendly entertainment options has caused subscribers to pay for subscriptions only during the release of particular programs or movies.
Given that half of Disney+'s subscribers do not have children, maintaining a well-rounded catalog of entertainment options has proven vital for the platform's success. While Disney+ may be improving the churn rate and keeping customers around for longer, the streaming service has not met its projected subscriber rates for the quarter.
Based on the reduction in churn rate, Star has proven to be an effective move for the company. Prior to Star, the streaming platform hosted five channels (Disney, National Geographic, Pixar, Marvel, Star Wars) which served as specialized directories for the platform's integral content. Given the breadth of Disney's subsidiaries, Star makes room for the service to add in programming that would not fit into other categories. Star's introduction adds hundreds of movies and shows and creates room for Disney+ to add new content on a weekly basis.
Source: What's On Disney Plus