The streaming service sector is rapidly expanding thanks to ever-growing consumer demand. Now you can find dozens of new streaming services, whereas there were none a decade ago. There will soon be a new addition to this streaming roster: Disney.
Disney had a long contract with Netflix to stream its classic animated movies and favorite TV shows. The company recently ended that contract and announced that it would launch its streaming service. The Disney streaming service will possibly debut in 2019.
A Whole New World for Disney
Disney has been one of the most lucrative brand names in the entertainment industry for nearly a century now. After acquiring the rights to the Star Wars franchise, Disney now owns some of the most lucrative movies of all time. Disney also has an invaluable library of animated movies, cartoons and live-action TV shows that have never gone out of favor. Perhaps it's only natural that Disney would launch its streaming service to cater directly to the brand's fans.
As for Netflix, the fallout with Disney is a major blow. Disney was one of the most valuable contracts Netflix had. The deal was secured way back in 2012 when streaming was still a novelty and had yet to appeal to the mass market. However, the contract was only fulfilled last year, meaning that Netflix lost a great deal before it could earn serious profits.
As for Disney, streaming could be a brand-new avenue to generate billions more in profits. It’s not easy to get access to Disney movies short of buying. People are required to make purchases, instead of renting, the movies. You won't easily find Disney movies at the local Box Office rental. Now that buying physical copies of movies are falling out of favor in general, streaming is only a natural step for Disney. The company will very likely draw major profits by having its streaming service for the timeless classics the company has produced in the last three decades.
Fate of Star Wars and Marvel Streaming Availability
The Netflix deal is not completely under the sea yet. The separation will be gradual, rather than sudden. Netflix still has some Disney movies in its library. Disney has announced plans to gently cut movies off Netflix starting in 2019 with the debut of the new streaming service. Netflix will still get to keep some Disney movies until the end of 2019, according to the new deal. Netflix users will be able to stream Star Wars Episode VII: The Force Awakens and the upcoming Star Wars Episode VIII: The Last Jedi. However, users will not be able to stream the final installment of the trilogy, which will be released after 2019.
The same goes for major Marvel content, so users don't have to worry just yet. Netflix has said that the streaming service will continue to do business with Disney. Netflix still retains the rights to stream content from Marvel TV. So, if you are a fan of the Marvel expanded universe, you will have uninterrupted access to content you already enjoy on the streaming service. It's possible that future Marvel movies and other content will be available on Netflix, at least until the end of 2019. There's no need to panic just yet.
Disney Making Huge Investments Toward the New Streaming Platform
Disney is not messing around with the suggested streaming platform in the works. The company has banded together with BAMTech to develop the software for the new streaming network. If you don't know, BAMTech is best referred to as an internet video developer that facilitates streaming of live major league baseball games. It has also developed the software that powers HBO, WWE, and NHL streaming platforms. Disney has made significant investments in BAMTech. Just this year, Disney made a huge $1.58 billion investment in the company.
Disney investments have certainly spiked BAMTech stocks, and the company is now valued over $3.5 billion. Financial observers point out that the Disney investments are a slow move towards full ownership of BAMTech. Disney has directly admitted as such. The latest over-a-billion-dollar investment gave Disney 75 percent controlling stake in BAMTech. Disney is well poised to own BAMTech once the deal gets the regulatory okay.
Disney’s celebrated CEO Bob Iger, under whose guidance the company re-emerged from some serious devaluation, has said that acquitting BAMTech would be “an entirely new growth strategy for the company.” The acquisition, when it happens, will launch Disney’s direct-to-consumer services. Disney hopes that new tech will give the upcoming streaming service a leg up to launch against a myriad of other streaming services. Netflix and Hulu already have long lineups of rival animated movies and TV shows, including ever-popular anime.
A Glimpse into Disney’s Future Streaming Service
What would the new Disney streaming service be like? Will be accessible around the world? Will it be better than Netflix? It’s too premature to answer burning hot questions like this. Disney has only said that the new streaming service will be a video-on-demand service available upon subscription, which is much like the other streaming services. Disney has also announced that the service will be exclusive in the U.S. It's not clear yet whether this means Disney streaming will not be available outside the U.S.
Many streaming services, including Netflix, don’t have complete libraries accessible to viewers located outside the U.S. The issue here is content licensing. Streaming services only purchase licenses for content for some areas where returns are guaranteed. In some cases, if another entity holds the regional copyright to the content, the streaming service is unable to make the content accessible to paying customers in that region. Disney typically holds exclusive rights to its content. But global delivery may prove to be difficult even for Disney.
In any case, the Disney streaming service will kick off in 2019 with new, original streaming content. The company plans to use the highly anticipated Toy Story 4 and Frozen sequel movies to popularize the streaming service. And of course, older titles from both Disney and Pixar will be available in the catalog. Content from the Disney TV channel will also be available.
Believe it or not, this is not the first time Disney is launching a streaming service. In 2015, the company launched Disneylife to an exclusive U.K. audience. British fan got unfettered access to extensive Disney content, including its beloved and envied back catalog. You know what it is. It includes Disney’s award-winning soundtracks, classic animations, and even books. You could get everything from Bug Juice to Wreck-It Ralph on Disneylife.
Disneylife could give us unique insights into what the upcoming streaming service could be like. Disneylife was surprisingly cheap at the time. It cost subscribers about $13 per month, which was cheaper than Netflix in the U.K. Disneylife came with an app that allows users to download and watch content offline. There was some live streaming content as well. Disneylife was made available in China for five brief months after discontinuing without a good explanation.
Disneylife was one of a kind when it first launched. Even Netflix, the reigning streaming service at the time, couldn’t match up to the Disney content available. As much as we love Netflix, it doesn’t give users access to music and hundreds of books, which Disneylife did. Disneylife is still available, but only as an app in the U.K.
It’s easy to speculate that the new streaming service will somehow resemble Disneylife. It was quite successful in the target market, and no other service could actually compare. For Disney fans, the choice was quite simple.
Disney’s ESPN Streaming Service will Launch Next Year
Disney is planning to launch a sports streaming service with ESPN unrelated to the other one for movies shows. The ESPN-Disney streaming channel will debut early in 2018. Disney co-owns ESPN, so this doesn’t come as a complete surprise. Disney has said that the new ESPN exclusive streaming service will showcase about 10,000 national, regional, and international games annually. Sports fans can rejoice at Disney's plans.
The ESPN streaming channel will be subscription only as well. It will make individual sports packages available to users. The service will be directly accessible to consumers without going through a third party. If you are a regular ESPN watcher, then you will definitely like this plan. ESPN has long suffered complaints of being too expensive. Many consumers and even cable companies have tried to drop the famous sports channel from plans just for this reason. Marketing directly to consumers may help Disney prevent ESPN from going wholly out of favor without cutting back on the profits the channel is making. Disney can potentially increase revenue per subscriber with ESPN streaming and find a devout target audience who love sports but have to miss out on live events.
With the two new streaming services, Disney will most likely dominate the streaming market, especially among families with little kids. The only disadvantage is that consumers have to subscribe to yet another streaming service without getting everything on one platform. But it’s probably worth it if you can watch Star Wars and Lion King with a single subscription.
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