Y Combinator’s Garry Tan Goes to the MatRead more

Disney CEO Bob Chapek. Photo by Bloomberg.

The Risks of Disney’s Quick Fix for Subscriber Growth

Photo: Disney CEO Bob Chapek. Photo by Bloomberg.

Disney has figured out an ingenious way to jump-start its streaming subscriber growth—give people less of a choice! Since late December, Disney has automatically included Disney+ and ESPN+ in one of its Hulu offerings, at a slightly higher price than it previously charged, we learned today. Ingenious! It’s a reminder that the customer-unfriendly DNA of the television industry still lurks in the genes of companies like Disney.

There’s only one reason you take this action, and it’s to juice subscriber numbers. The strategy is working so far. Disney executives said the bundling—which they called a “strategic decision,” whatever that means—accounted for half of the surprisingly strong North American subscriber additions for Disney+ in the quarter. And sure, it’s a good deal for consumers right now: Even after the price raise, the bundle implies a hefty discount on all three services. But it’s a slippery slope. Forcing people to take services they don’t necessarily want is how the cable TV became a cash-printing machine, before steady price rises eventually alienated so many customers it went into a decline that is still underway. 

Access on the go
View stories on our mobile app and tune into our weekly podcast.
Join live video Q&A’s
Deep-dive into topics like startups and autonomous vehicles with our top reporters and other executives.
Enjoy a clutter-free experience
Read without any banner ads.
Former Apple design chief Jony Ive and OpenAI CEO Sam Altman. Photos by Getty.
Designer Jony Ive and OpenAI’s Sam Altman Discuss AI Hardware Project
Jony Ive, the renowned designer of the iPhone, and OpenAI CEO Sam Altman have been discussing building a new AI hardware device, according to two people familiar with the conversations.
From left to right: Blair Effron, Robert Pruzan and David Handler. Photos by Getty; Tidal Partners.
Exclusive Finance
Disputes, Employee Misconduct Rattle Centerview’s Silicon Valley Dreams
The San Francisco Bay Area–based bankers at Centerview Partners, the investment bank that advised Silicon Valley Bank’s owner and Credit Suisse through recent turmoil, got two doses of bad news last week.
Art by Clark Miller
Exclusive startups entertainment
MasterClass Takes a Crash Course in Frugality
MasterClass had a problem with the shoot featuring its latest star instructor, Walt Disney Co. CEO Bob Iger.
OpenAI CEO Sam Altman and Microsoft CEO Satya Nadella. Photos via Getty
Exclusive microsoft ai
How Microsoft is Trying to Lessen Its Addiction to OpenAI as AI Costs Soar
Microsoft’s push to put artificial intelligence into its software has hinged almost entirely on OpenAI , the startup Microsoft funded in exchange for the right to use its cutting-edge technology.
From left: Paul Graham, Garry Tan and Michael Seibel. Photos by Getty. Art by Mike Sullivan.
Exclusive startups ai
Y Combinator’s Garry Tan Goes to the Mat
Garry Tan was in his happy place. Surrounded by food trucks and techies basking in San Francisco’s September sun, the CEO of Y Combinator snapped selfies with entrepreneurs as he meandered through a crowd of 2,700 attendees at the startup accelerator’s annual alumni event.
Art by Clark Miller
The Big Read policy
Europe Has Figured Out How to Tame Big Tech. Can the U.S. Learn Its Tricks?
Late last month in Belgium, Sen. Elizabeth Warren (D-Mass.) had a pressing question for Paul Tang, a Dutch politician and member of the European Parliament.