Disney to enforce password-sharing restrictions from June: CEO Bob Iger
What's the story
Walt Disney's streaming service is set to implement password-sharing restrictions starting in June, as announced by CEO Bob Iger.
This move forms a crucial part of Disney's strategy to boost subscriber numbers and transform its streaming business into a profitable venture.
The decision follows a similar action taken by competitor Netflix, which saw a significant increase in subscribers. The company gained close to 22 million subscribers in the second half of 2023 after its crackdown on password sharing.
Strategy discussion
Disney's future goals and industry consolidation
In a conversation with CNBC, Iger highlighted the need for consolidation within the streaming industry.
He also shared Disney's future objective of achieving double-digit margins for its streaming operations.
This announcement comes in the wake of a contentious proxy battle of company directors with activist investors who criticized Disney's performance in the streaming television era.
Company outlook
CEO succession and future plans
Iger emphasized that Disney is taking the issue of CEO succession, a significant concern for shareholders, "very seriously."
This comes at a pivotal time for Disney as it seeks to revitalize its film and television franchises, make its streaming division profitable, and find partners to bolster ESPN's digital future.
Following Iger's remarks, activist investor Nelson Peltz expressed optimism about the CEO fulfilling his commitments.
Market response
Shares rise following CEO's announcement of password-sharing restrictions
After the announcement of password-sharing restrictions and future plans, Disney shares saw a slight increase of about 0.7% in morning trading.
So far this year, Disney's shares have grown by 30%, making them the top performer on the blue-chip Dow Jones Industrial Average.
Iger also revealed that discussions are underway to find a strategic partner for ESPN.