The soaring costs of streaming services
August 16, 2023 - The days of cheap streaming are drawing to a close as studios hike prices to rival the expense of cable TV packages that viewers began ditching for Netflix some 15 years ago.
In the United States over the past few years, people have been leaving cable TV, enticed by the low prices of streaming services such as Netflix and Disney+, who between them now have nearly 400 million subscribers worldwide.
Soaring interest rates, which have made borrowing more expensive, together with cinema audiences not back to pre-pandemic levels, has taken its toll on movie studios, with the likes of Warner Bros and Disney seeing their stock values more than half.
Now Wall Street has grown impatient with the largely loss-making streaming services and global prices are going up.
Netflix is raising it's ad-free tier from $9.99 a month to $15.49 – a rise of 55%. Disney+ subscribers will soon have to pay $13.99 a month, a staggering increase of 75% on what it charged in October 2022.
Price increases could backfire if cash-strapped households decide to drop their costly subscriptions entirely – a risk studio executives seem prepared to take.