Disney+ and Hulu opt out of App Store In-App Purchase billing

Apple’s App Store has long required streaming platforms to allow users to subscribe through in-app purchases. However, a recent shift has seen many platforms, including Disney, moving away from this model.

Disney recently made the decision to remove the option for users to subscribe to Disney+ and Hulu through their iOS apps. Instead, new users are directed to create accounts via external websites. Existing subscribers who currently use in-app purchases on iOS will not be affected, but new subscribers must now sign up through the website.

This move by Disney follows similar actions by other streaming giants like Netflix and Spotify, who have also abandoned Apple’s in-app purchase system. In 2022, Apple revised its App Store policies to allow "reader" apps to redirect users to external websites for purchases related to digital content.

The motivation behind this industry-wide shift is primarily financial, as these platforms seek to avoid the 15-30% commission fees charged by Apple. Despite saving on these fees, Disney+ and Hulu have indicated that they do not intend to pass on the savings to their customers, as both services announced price increases earlier this year.

Disney CEO Bob Iger previously highlighted the company’s focus on turning streaming into a growing business by reducing customer acquisition costs and trimming marketing expenses. While Disney may be dissatisfied with the App Store fees, an Apple spokesperson emphasized the benefits that the App Store has provided in reaching a broader audience for Disney’s apps, including games and utilities for its theme parks.

Moreover, Disney+ and Hulu have benefited from Apple’s Video Partner Program, which not only helps promote content through Universal Search and Siri but also reduces the App Store commission from 30% to 15%. Apple maintains that its in-app purchase system remains the best way for users to buy digital goods and services, citing its ability to handle transactions across various countries and currencies, along with built-in anti-fraud measures.

For users who subscribe to Disney+ or Hulu through their iOS apps, managing subscriptions can be done through the Settings menu. This shift in subscription models reflects a broader trend in the industry as streaming services seek to optimize their revenue streams while enhancing user experience.