3rdPartyFeeds News

Disney launches $6.99 streaming service, but will Netflix fans go for it?

The Mickey Mouse media megalith makes a big splash with a little price. Read More...

A Mousketeer hat is worth $18 and a frankfurter in Epcot Theme Park’s Germany costs $10.

But the monthly cost to stream some 7,500 episodes and 500 movies on Disney’s newly-detailed streaming service without any advertising? That’ll set you back the mere, mousey sum of $6.99 per month.

The little price tag made a big splash as Disney DIS, +11.54%   executives went into detail Thursday for the first time about their jump into the streaming market with Disney Plus, which is slated to go live Nov. 12.

Disney will be able to release “Captain Marvel,” which was released on March 8 and has earned over $1 billion in the global box office ($377 million of that came from the U.S. market). It will also stream “The Simpsons,” “Dumbo,” “The Lion King,” “Lady & the Tramp,” as well as the “Star Wars” back catalogue.

It adds to a coterie of streaming services, including Netflix, Hulu, Apple TV and Amazon Prime. Netflix, for instance, has global hits like “The Crown,” and critical successes like “Russian Doll” and “Stranger Things,” “Black Mirror” and “Orange is the New Black.”

Disney may appeal to users who want more family fare.

Amazon Prime has the Emmy-award winning “The Marvelous Mrs. Maisel,” “Fleabag,” “Doctor Who,” “The Man in the High Castle,” “The Americans,” and classic shows like “The Wire,” “The Sopranos,” and “Cheers.”

“We wanted to reach as many people as possible,” Disney CEO Robert Iger said at Thursday’s rollout, detailing a subscription service that includes access to Disney films and television, along with its Pixar, Marvel, Star Wars and National Geographic brands.

Subscribers will also be able to download content for offline access for, say, plane travel or to entertain the kids on long road trips. While there’s certainly overlap with between the major streaming services, experts say Disney may appeal to users who want family fare.

Don’t miss: Disney’s Netflix rival now has a name: Disney+, which will launch in 2019

Disney is estimating it can amass between 60 and 90 million viewers globally by the end of fiscal year 2024. The service costs less than the lowest priced package for Netflix ($9), which had 137 million subscribers at the end of 2018.

The announcement of the monthly price reportedly produced gasps in the audience at the Burbank, Calif. sound stage. The yearly price will be $70.

Kathi Chandler-Payatt, media entertainment analyst at industry research group NPD, said Disney’s “potential to sail past other services is favorable.” The company had strong content, bolstered by its consumer products and parks. “In short, Disney with Disney+ is an even stronger online and offline ecosystem.”

‘Who has a better library than Disney?’

—Dan Rayburn, principal analyst at Frost and Sullivan

Dan Rayburn, principal analyst at the digital media group of the consulting firm Frost & Sullivan, said Disney’s low price and vast entertainment library would make it a formidable contender.

“Man, $6.99, that is just aggressive,” Rayburn told MarketWatch. The streaming business is getting more crowded by the day, but Disney’s entry was “a game change for one reason: quality of content. … Who has a better library than Disney?”

His prediction: “They’ll sign up boatload of consumers,” he said.

Will viewers add Disney streaming or jump ship from Netflix?

Some streaming market experts have said consumers are willing to pay for up to three services at any one time — and not more than that. Likewise, the $50 dollar range is also the outermost price many consumers will pay, according to them.

Indeed, with so much streaming content out there, maybe some will be too tapped out to tune in to the latest subscription service. As one person said on Twitter TWTR, -0.61%   on Thursday, “With #DisneyPlus launching this fall/winter, I’ll have to cancel service to one of the following: Netflix Hulu Starz (through Amazon Prime) HBO Go. Need suggestions.”

Consumers may be willing to pay for no more than 3 services at any one time.

Netflix NFLX, -4.49% raised prices earlier this year to $12.99 for its standard plan (the middle of its three options), up from $10.99. That will get you movies like the blockbuster “Black Panther” and critically successful “Carol.”

Meanwhile, Amazon Prime’s AMZN, -0.05%  yearly price tag for free shipping and original shows like “Catastrophe” and “Patriot” is $119.

On Wednesday, You Tube TV GOOG, +1.10%  said it would raise its monthly subscription fee to $49.99 from $39.99, while subscribers billed through Apple would pay $54.99 per month.

Apple AAPL, -0.04%   announced its foray into the field late last month, but didn’t say how much its services would cost.

Disney, through its acquisition of 21st Century Fox, has a 60% stake in Hulu. Hulu charges $5.99 for a monthly subscription, $11.99 for an advertising-free subscription and $44.99 for on-demand and live TV plan for $44.99.

Get a daily roundup of the top reads in personal finance delivered to your inbox. Subscribe to MarketWatch’s free Personal Finance Daily newsletter. Sign up here.

Read More

Add Comment

Click here to post a comment