"They can't survive at $6.99," said Jeffrey Cole, director of the USC Annenberg Center for Digital Future.
Although consumers can currently sign up for Disney+ at the $6.99/month price ahead of the service's official launch next month, they also have the option of subscribing yearly for $69.99. Furthermore, Disney is offering a bundle that contains Disney+, ESPN+ and Hulu's ad-supported model for a combined price of $12.99/month. Nevertheless, with such a low cost of entry, it only makes sense Disney would eventually need to raise the price to achieve profitability.
As for how Disney settled on the introductory price in the first place, Kevin Mayer, chairman of Disney's direct-to-consumer and international division explained that "We wanted to find the right price that we felt reflected the quality of the service and the product itself while also maintaining something that is pretty important at Disney, democratizing the availability of the app." With that in mind, the company made its final decision based on its goal to reach upwards of 160 million subscribers across Disney+, ESPN+ and Hulu by 2024.
Disney+ launches in the U.S. on Nov. 12.
(via The Hollywood Reporter)