Telecom Operator Arrangements Critical to Disney+ Hotstar

The Walt Disney CEO said that the company is “confident” that it can “reclaim” all its users that it loses due to the lack of auto renewal options.

Published by
Bala Yogesh

Disney+ Hostar, the over-the-top (OTT) streaming platform run by Walt Disney owned Star India, has over 18,000 hours of “unparalleled content,” says Bob Chapek, chief executive officer at Walt Disney. Chapek said that Walt Disney’s approach with its direct-to-consumer offerings “across the world is that one size does not fit all.” The chief executive officer at Walt Disney said that the company heads to the market with “different propositions, different utilities and different offerings.” Chapek said that Disney+ Hotstar has a variety of content, including sports and that the Indian Premier League “is really an important asset” in India and that the company is “lucky to have it.”

IPL Resumption “Good News” for Disney+ Hotstar

With the resumption of the Indian Premier League (IPL), Chapek said that the company is witnessing a “combination of two things happening at once in India.”

“Number one, there is

that shift of timing of the IPL season, which is really an important factor, and it happened to be coincident with the annual expiration of a large cohort of subscribers,” Chapek said in the annual Goldman Sachs Communacopia Conference on Tuesday.

In February, Christine McCarthy, chief financial officer at Walt Disney, said the “Disney+ Hotstar subscriber additions continued” its “strong growth trend” largely driven by the IPL. McCarthy, in the first-quarter earnings call for the period ended January 2, 2021, said that the company even made it “economical” for its users to sign up for one-year packs.

It has to be noted that the 2020 IPL season was held between September 19, 2020, to November 10, 2020. The 2021 IPL season was initially scheduled to be held between April 9, 2021, to the end of May. However, the rising COVID-19 cases within the IPL bubble meant that the season was halted in early May, with the season resuming on September 19, 2021.

Chapek highlighted that the auto-renewal option is not permitted in India and that the company has to “get that cohort back” each and “every time you lose a cohort.”

“The good news is we’ve got IPL coming, so it’s going to be plenty of incentive to get some of those folks back, but you have to take a step back before you take a step forward in terms of those renewals,” Chapek said.

According to the guidelines issued by the Reserve Bank of India initially in August 2019, recurring transactions require additional authentication from the user during registration and the first transaction. The new guideline was initially set to go live by March 31, 2021, but has now been extended to September 30, 2021.

Disney+ Hotstar “Confident” to “Reclaim” its User Base

The chief executive officer at Walt Disney said that the company is “confident” that it can “reclaim” all its users that it loses due to the lack of auto-renewal options.

“But it’s not just about the content; it’s primarily about the content because it’s also about having those distribution arrangements with the local mobile carriers,” Chapek said. “And then even once you have that, you’ve got to have the consideration to deliver your product with low bandwidth because that’s what that market requires.”

Similar to Disney+ Hotstar, other major Indian streaming platforms including Zee5 and Sun NXT have also inked deals with the telecom operators. In August, SL Narayanan, group chief financial officer at Sun TV Network said that the telecom operators receive “restricted access” to Sun NXT portfolio.

Meanwhile, Chapek said the company is “making more and more core Disney products available” to its users in India as it is “also what they love, but there are things that are unique.”

“And I think it’s really being sort of tuned into what’s required and hey, let’s not forget all the sports offerings that we have at the same time,” Chapek said.

In August, the Walt Disney company revised the subscriptions plans for Disney+ Hotstar, with the new plans effective from September 1, 2021. The three new Disney+ Hotstar plans priced at Rs 499, Rs 899 and Rs 1499 offers users access to all the content available on the streaming platform. The differences between the three Disney+ Hotstar plans are restricted to the video and audio quality along with advertisements. The company earlier required users to subscribe to its premium plan priced at Rs 1499 to access the English shows and the Disney content in the English language.

Bala Yogesh

Born in India, Yogesh loves to travel and has lived in multiple countries including New Zealand and Canada. His bylines can be found on various newspapers and blogs throughout the world, including Vancouver Sun, Surrey Now-Leader, Daily Hive , Investing News Network and Rach F1.

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Bala Yogesh

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