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Hotstar is dragging down Disney + Q1’s ARPU and now has 28.5 million subscribers





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Bengaluru: The Walt Disney Co.’s streaming service Disney + earned an average of $ 4.03 per paying subscriber for the first fiscal quarter ended January 2, 2021, a significant drop of $ 4.52 in the previous quarter and a decrease of 28% from from $ 5.56 in the corresponding quarter last year.

The company attributed the decline in average revenue per user (ARPU) to Disney + ‘s much lower average prices Hotstar in India and Indonesia compared to Disney + in other markets.

Disney + Hotstar currently offers annual plans ranging from Rs 399 (Disney + Hotstar VIP) to Rs 1,499 (Disney + Hotstar Premium). It also offers a monthly premium subscription of Rs 299. In comparison, Disney + offers a $ 70 annual subscription (approximately Rs 5,070 at current exchange rates) in the United States, which is expected to increase to $ 80 next month.

It’s also worth noting that Disney + Hotstar operates on a freemium model where it offers certain content on a free ad-supported model, unlike Disney + which only offers paid plans.

Excluding Disney + Hotstar, the streaming service’s average revenue per user jumps to $ 5.37 for the quarter, Disney Chief Financial Officer Christine McCarthy said during the company’s conference call on Thursday.

This indicates that Disney + Hotstar made about $ 0.91 from each subscriber during the quarter, a big dip from $ 2.19 in the quarter ended September, according to ETtech calculations.

Disney + Hotstar subscriber base

During the earnings call, McCarthy also noted that Disney + Hotstar accounts for 30% of its 94.9 million global subscriber base, indicating that the service has approximately 28.5 million paying members in India and Indonesia, with 2.5 million subscribers in the month of December and about 10 million subscribers for the whole quarter.

Disney + Hotstar had
about 26 million subscribers On December 2, 2020, Rebecca Campbell, president of Disney’s International Operations and direct-to-consumer segment had announced this during the company’s annual investor day in December 2020. India accounts for a majority of the service’s subscriber base, which is also Indonesia in early September. The service does not provide a region-specific breakdown of the subscriber base.

Thursday ET
reported that Disney + Hotstar parent company Novi Digital Entertainment had cut its net loss to Rs 361.8 crore for the fiscal year ended March 31, 2020, from Rs 554.38 crore in the previous fiscal year. This was due to a 45% increase in revenues to Rs 1,628 crore. The service saw a 56% increase in ad revenue to Rs 974.23 crore and 32.6% in subscription revenue to Rs 618.79 crore.

In India, Disney + Hotstar competes with players such as Netflix India, Amazon Prime Video, Essel Group’s Zee5, Times Internet’s MX Player, Sony Pictures Network’s SonyLIV, Viacom18’s Voot and Reliance-backed ALT Balaji.

Overall, Disney posted total sales of $ 16.25 billion for the quarter, down 22% from $ 20.9 billion in the same quarter last year. Company
posted a profit of $ 29 million for the quarter, compared to $ 2.13 billion a year ago, after the Covid-19 pandemic seriously affected all other divisions, including theatrical companies and theme parks.

Disclosure: Times Internet operates ETtech.com.

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