Here's Why Disney's Latest Price Hike Could Backfire
Live sports are steadily growing in importance within the streaming industry, with multiple platforms engaging in bidding wars for broadcasting rights. Disney (NYSE: DIS) has dominated the market since its sports streaming service ESPN+ launched in 2018, but a recent price hike could backfire on the company. Here's why Disney might lose subscribers after raising the price of ESPN+.
Disney announced a price hike coming to ESPN+ in mid-July, with the increase set to take place on Aug. 23. The new price is a rise of 43%, jumping from $6.99 a month to $9.99. The company reasoned that the rise in cost will "add significantly to both live sports and original programs and series." Although the platform has recently added content such as 75 regular-season National Hockey League games in 2021, and golf program PGA Tour Live in January, ESPN+ has significant holes in its programming that competing services are offering.
Football is the biggest sport in the U.S., with an average audience of 114.3 million domestic views from 2021 to 2022 -- 6.7 times more watched than basketball, the third biggest U.S. sport. Yet neither the National Football League (NFL) nor the National Basketball League (NBA) can be streamed on ESPN+. The NFL recently launched its own streaming service with NFL+, which costs $4.99/month. Amazon (NASDAQ: AMZN) has also entered the market by adding Thursday Night Football to Prime Video. The company paid $1 billion for exclusive rights to stream 15 NFL games for 11 years starting in 2022.
Source Fool.com
