Disney Plus and Hulu face challenges with Apple tax

Disney has recently implemented changes to its streaming services, with Disney Plus and Hulu no longer supporting App Store billing on iOS and iPadOS devices. This modification is part of Disney’s strategy to maximize revenue by avoiding Apple’s commission fees.

New and returning subscribers are now required to subscribe to Disney Plus and Hulu through the web instead of using Apple’s App Store billing system. However, existing subscribers who are currently paying through Apple will not be affected unless they decide to cancel their subscriptions.

The decision to drop App Store billing is a move to enable Disney to retain all profits from subscriptions by circumventing Apple’s 15-30% commission fees. By encouraging users to subscribe directly on their websites, Disney gains full control over the revenue generated from these services. Once subscribed via the web, users can still access content on their iOS and iPadOS devices through the respective apps.

While this change benefits Disney financially, it may have implications on the apps’ features and eligibility for Apple’s Video Partner Program. By no longer utilizing Apple’s in-app purchasing method, Disney risks losing the privileges associated with the Video Partner Program. This program provides visibility for participating apps in the Apple TV app, tvOS, Universal Search, and Siri. If Disney is disqualified from this program, it could impact the discoverability and visibility of its content on Apple platforms.

Overall, the decision to discontinue App Store billing for Disney Plus and Hulu on iOS and iPadOS devices reflects Disney’s strategic shift towards maximizing revenue and reducing dependency on third-party platforms. While this change may inconvenience new and returning subscribers, it aligns with Disney’s goal of retaining full control over its subscription services and revenue streams.