Disney Streaming Service Could Outgrow Netflix

March 11, 2019
537 Views

Disney (NYSE: DIS) online media streaming service is yet to enter the market, but some analysts believe it could outgrow Netflix in a short time. The service, branded as Disney+, is set to launch at the end of this year in the United States. Other territories will follow in 2020.

Netflix currently has almost 140 million subscribers around the world, a number which could be surpassed by the company as its own service matures.

160 Million Subscribers According to J.P. Morgan

Alexia Quadrani, a top J.P. Morgan analyst told investors recently that Disney+ could attract up to 160 million subscribers by the time it is rolled out to all major international markets.

As of today, Netflix has just over 139 million subscribers. It launched its streaming service in 2007.

The analyst believes that the strength will come from existing brand recognition. In a written report in March, she said that “While there is little question that there are more direct-to-consumer services today than ultimately should survive, we have no doubt that it remains on the short list of products that should prevail longer-term.”

Quadrani cited Disney’s “Unmatched brand recognition, extensive premium content, and unparalleled ecosystem to market the service.”

The marketing reach is extensive, with global toy brands, film and television productions, and theme parks.

Disney also controls some of the most valuable franchises and studios of all time. These include Marvel, Star Wars, and Pixar Animation Studios. They would have the potential to ‘black out’ its content from other providers. This already seems to be occurring, as Disney owned properties have been cancelled or pulled from Netflix.

The company has almost 100 years of its own productions to pull content from, including some of the best loved and highest grossing animated feature films.

 Disney Compete at a Lower Price Point

Disney appears willing to cut profits to get a quick foothold in the streaming market. The company has already told investors and consumers that Disney+ will be offered for a price “substantially below” that of Netflix and other services. Netflix’s basic package is currently offered for $9 in the United States.

The public stock has grown 3.79% this year, significantly less than the benchmark growth of 9.15% on the NYSE Composite Index. The release of Disney+ later this year could provide a much welcome boost to stock.

You may be interested

Pork Farmers Will Benefit from China Trade Deal
Business
4 views
Business
4 views

Pork Farmers Will Benefit from China Trade Deal

Becky H - January 20, 2020

China and the United States signed a much-publicized Phase One Trade Deal last week, setting a framework for better relations…

Google Hits $1 Trillion Market Cap
Business
29 views
Business
29 views

Google Hits $1 Trillion Market Cap

Adam R - January 17, 2020

Google parent company, Alphabet Inc. (NASDAQ: GOOGL), is now the third U.S. company to break $1 trillion in market capitalization…

Phase One Trade Deal Signed Between U.S. and China
Investing
40 views
Investing
40 views

Phase One Trade Deal Signed Between U.S. and China

Becky H - January 16, 2020

The United States and China have taken a huge step forward in trade negotiations, with the signing of a Phase…