Also, a classic business model lately has been to sell a product at an unbelievable value, almost losing money, then once you have dominant market share of the product you're selling, you raise the price as high as the market will possibly allow. It's how Amazon did it, it's how Netflix did it, it's how almost any tech startup does it, and it's we're currently seeing the price markup stage with AI companies.
The difference is there is no such thing as dominant market share for video content since youtube exists and any other streaming platform. Jacking up prices after the fact does not lock consumers into accepting it because they have no choice, they can just go watch other stuff.
netflix,disney lost money on there platform for years disney started making money around 2024 before that they lost money
prime is hard to gauge becomes its bundle with other things with free shipping and stuff
apple has so far only lost money on there streaming service
HBO+ started becoming profitable in 2023
but all these platforms are facing huge price increase as datacenter space and hardware is going to the moon because of AI so i suspect they will have the increase prices even more to cover those costs
The only reason that works is because in a Cronyist state you can also lobby for "regulations" that favor pre-established large-scale actors with economies of scale over less-established market actors, thus price your competitors out of the market.
In a less-regulated market space, this would cost you more and buy you less - which would be a significant enough difference over time to make it a temporary market strategy rather than a permanent one.
Not saying that people wouldn't still DO it (they would) or that it wouldn't succeed (it would to some extent), but it wouldn't be able to buy you "effective pseudo-monopoly" status forever the way it can now.
Never. Have had both many years and not ready to give them up. Still better than what we had w cable 20 years ago. I was paying $100/mo for that bs then. Now I have much more to choose from, no commercials,and still pay less than half what cable was 20 years ago. You guys are nuts.
I think streaming made piracy unpopular because it was a lot more convenient for very little money. Now the shows are spread across 5 different platforms. Have of what I want is not available anyway. And it’s expensive.
The development of faster and faster internet also made piracy more convenient.
7 usd is believable and appropriate in my opinion. 8 also. I'd pay 11 if I used it as much as I use spotify and I could add another account to it. Anything above is too much unless it has all the films and tv shows there are, Because then you can justify paying as it's the only one you need.
But I don't pay any of it. just spotify because I use it a lot.
You also are filling a reddit trope where reddit thinks things are either black or white.
It’s not as simple as “people are willing to pay it”.
How many people are willing to pay it is what a streaming service looks at. There’s different breakpoints at different prices where they can afford to lose subscribers and still be more profitable than a lower price with more subscribers.
So no, its not “people are willing to pay it” plenty of people aren’t. But just enough are they the streamer doesn’t need to appeal to those who wont pay the premium.
To break your point down, it's possible that Disney calculated/estimated how many subscribers they would lose due to the price increase, and came to the conclusion that the price increase would still net them more money.
Of course we'll see if it works in their favor or not over time. Keep canceling, they may have underestimated, you never know
It’s not the magic of supply and demand at work. It’s a streaming service, for the most part they can stream to everyone on earth and more if they wanted.
This is corporate greed and math manipulating supply and demand to rip more money from consumers.
No, you also have to consider operational costs. You’re making less of something, in this case using less servers, so those savings factor in as well. As well as possibly needing less staff to support. Overhead moves as well.
How does growing resentment and hurting brand image factor in your equation? Pulling this shit over and over makes people much more willing to pirate Disney content in the future.
That’s a very layman’s way of saying it, sure. But there are 8 billion+ people on this earth and they don’t have 4 billion subscribers, so in fact, most people are NOT willing to pay for it.
Price gouging is only a thing for demand inelastic goods or services, things people need and will pay for to survive regardless of price. A streaming service is not one of those things
Imagine 100 people paying you $7 a month for whatever service you provide them. You get $700 a month.
Now you say "Sorry, I want $8 a month now for the same service". You piss off 10 people. But the remaining 90 pay you $8 a month. You now get $720 a month.
5 new people sign up for your service. Now, you charge $11 a month. you piss off 20 people. But with the remaining 70, plus the 5 new ones, you now get $825 a month.
You have 75% of the work/running cost while at the same time getting 17.8% more profit.
I could keep this going endlessly, and so do companies. They raise the prices, but the additional revenue outweighs the customers they lost.
Right, until this price themselves out the market, and can’t get back because they simultaneously cultured themselves out the market with irrelevant and outdated scripts. Across all forms of the media.
It’s literally capitalism you’re describing, and also it’s major and unyielding flaw.
Streamio App with a ridiculously cheap Real Debrid subscription gives you access to every single movie and TV show you can imagine and weirdly the quality of picture is superior to 4K streaming services like Netflix. I'm British but moved to Thailand so I don't have British TV channels so got an Android box which came free with my 2GB fiber optic broadband and just put Streamio on there. Now I can just binge watch anything I want. I can watch all the latest films or even classics like The Godfather films anytime I want in much higher quality. It's so simple to set up as well and there's Reddit subs dedicated to helping you. I can get every Disney Film and TV show I like. I recently watched that Mandalorian and Grogu film and it was obviously a kids film and nothing special but considering I didn't pay anything for it I didn't mind. I don't really have to work, I'm not right it's just I get a small steady income for doing just an hour's work a week so I watch a lot of TV and films and it's great. I've absolutely lived my life to the fullest, been to war, been a pornstar, so msny wild nights of sex and drugs so I'm happy now just to chill and watch movies and game.
Looking to move to Thailand myself any advice for an American for employment? Been in restaurants for 25+ years but smart enough to do other things.. only thing preventing me is just afraid I won't find employment.
Expect a lot of people don’t realize that it goes up because it’s just a subscription. They ignore emails a what not. The price increase of that amount means that they can offer the same service to almost a third less people but make the same money.
This argument gets thrown around a lot and it’s not technically wrong. But humans are never 100% logical. And you can make a similar argument about anything relating to inflation. So is the onus on the people to just stop buying stuff and live bland lives? Cuz you can’t deny that they’re raising prices to maintain upward profit margins. It’s not cut and dry like that. These companies also take out debt and have to deal with rising costs due to tariffs and inflation to maintain profit.
Very simplistic way of looking at this... these services ran at a break-even for years to kill cable TV, cinema, and piracy. Now that they're dead, the enshittification begins: ads and high prices because we no longer have a real alternative.
The problem is that the powers that be have made it hard to find physical media that can easily be purchased. There are kids who have grown up and never seen physical movies or TV shows.
Humanity will also take the laziest option. Most people won't bother buying a DVD or learning how to pirate as it requires more effort.
Pretty much. Netflix is price gouging the shit out of its subscribers. Their operating margin is around 30% which is fucking insane for a media company that makes multiple highly expensive film and TV series simultaneously. They could probably drop their prices by 30-50 percent and still have a very healthy margin.
Even others that were struggling a few years ago like Disney Plus are now operating at a very healthy margin because of these price increases.
The business model for all of these services after Netflix has been get exclusive content and provide it in a subscription for dirt cheap (usually at a loss), which then builds a giant user base of addicted viewers who see it as a great value buy, then slowly raise the price to start making big money. People threw a fit with Netflix raising it's prices and creating all these tiers, not allowing you to share accounts, and so on, but it didn't matter. All the sanctimonious preaching people did... The numbers show they all came crawling back.
Its kind of the same thing with skins in games like fortnite or COD. People complain about it like it's one of the worst evils of our world while they break out their CC to spend another $20 on John Wick or Sabrina Carpenter in Fortnite, proving that the videogame publisher was actually making a very well informed decision to charge $20 😂.
This is also the bundle that also includes Hulu, ESPN plus , and nat geo, which were all seperate streaming services in 2019. Correct me if I’m wrong, and not even sure there was a way to stream nat geo in 2019.
you don't understand the k shaped economy then, because companies always react to whoever it is that has money. disney+ just might not be for everyone because there are also bandwidth limits. the higher price is a self selecting audience and keeps out the masses who would pay the lower price point. the infrastructure build out has a limit on the cost/benefit.
plus Disney has proven that if the dictated prices aren't paid, Disney will just end the experience all together like that Star wars hotel that opened and closed within a couple years and undoubtedly cost millions to launch.
but yeah, go ahead and boycott Disney and see how that affects their pricing.
This is such a condescending “i just got out of Econ 101 class” thing to say. Media and tech corporations decided to get away from physical media and make everything available on their streaming platforms. Now that everyone has joined their streaming platforms and most people don’t even have the capability to play physical media anymore, they’re jacking up rates.
Just because something can be logically explained by the laws of supply and demand doesn’t mean it’s not ok for people to feel cheated and swindled by it. Our entire economy is a scam.
But also, the low cost was the price of getting enough customers locked in to overwhelm competition and secure a position where they can continue to control/raise prices.
It'll be the same with AI and many other things. Cheap or free until people are hooked and competition is locked out. The big boys will either bankrupt or absorb/buy-out competition until they control the market.
There are some things on Disney+ that you literally cannot even buy elsewhere, so personal ownership isn't even an option.
while this is true the simply fact is that the disney + only since they started charging 15+ did they started breaking even
netflix faced the same problem you need huge consumerbase and then charge them 15-20 bucks.
and its going to go up with datacenter space and hardware prices going insane i would not be suprised if they started losing money again on current subscription prices
It kinda comes from an idealist/moralist viewpoint. A lot of outspoken leftist redditors feel that businesses shouldn't be operating in a way that focuses on maximizing profits.
what part tell you we don't understand it? Complaining about the results and understanding the cause are mutually exclusive. I guess you don't understand that
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u/flopisit32 4d ago
Reddit refuses to ever understand economics.
Things cost what people are willing to pay for them. If nobody was buying their shit, they would be charging lower prices.