Disney throws down gauntlet in war on Netflix

Walt Disney Co. is bringing its biggest weapons to a new streaming service, including "Star Wars" and Marvel superheroes, in what is expected to be bruising war with Netflix and others for television dominance. (AFP)
Updated 14 April 2019

Disney throws down gauntlet in war on Netflix

  • Disney+ streaming service would launch in November in the United States and gradually expand internationally
  • Subscriptions are due to start at $6.99 per month — less than streaming leader Netflix’s most basic $8.99 plan

WASHINGTON: The battle is on. Walt Disney Co. is bringing its biggest weapons to a new streaming service, including “Star Wars” and Marvel superheroes, in what is expected to be bruising war with Netflix and others for television dominance.
The media-entertainment colossus announced its Disney+ streaming service would launch in November in the United States and gradually expand internationally.
The new service’s subscriptions are due to start at $6.99 per month — less than streaming leader Netflix’s most basic $8.99 plan.
Disney+ will be packed with blockbuster movies and TV shows from the Disney library, including its recently acquired assets from 21st Century Fox.
That includes shows and films from Pixar animation studios, the Marvel franchise of superheroes like “Spider Man” and “Captain America,” National Geographic documentaries and of course the “Star Wars” series.
Disney said it would include all 30 seasons of “The Simpsons,” family-friendly titles like “The Sound of Music,“and “Malcolm in the Middle” and its forthcoming “space opera“series “The Mandalorian.”
Analysts says Disney’s announcement shows it is giving no quarter as it battles Netflix, Amazon Prime Video, Hulu and an upcoming service from Apple.
“The biggest surprise was the price — $6.99 per month, which was much lower than many people were expecting,” said Alan Wolk, co-founder of the TVREV consulting firm.
“It’s also ad-free, which was unexpected, as the conventional wisdom was that they would go to a hybrid Hulu-style model, with both ad-supported and ad-free options.”
Wolk said the programming “is exactly what you’d expect from Disney and will appeal to families with children.”
Wolk said the content will mean the new service won’t compete head-on with Hulu, which is 60 percent owned by Disney.
The move “allows them to position Hulu as their edgier, adult offering,” he said.
Disney has predicted it will sign up 60 million to 90 million users over the next five years.
Some analysts have said they expect Disney’s new service to grow quickly and eventually top Netflix’s 140 million worldwide subscribers.
Analyst Neil Macker at Morningstar said Disney “came out swinging at its investor day with an aggressive price point” for its streaming service.
“We were pleasantly surprised by the content levels” announced at Thursday’s investor event, Macker said.
“While it is smaller than Netflix, we think the Disney+ library will be deeper in terms of quality.”
Tuna Amobi of CFRA Research said Disney+ will launch with “an unparalleled array of branded TV/film content” and as a result “could be a potential game-changer in a rapidly evolving streaming landscape.”
Amobi said Disney also has the potential to “bundle” its new product with Hulu and its recently launched ESPN+ sports streaming service to give consumers a wider choice of content.
But some analysts argue that rivals will not take the competition sitting down and that nimbler Internet firms may prevail.
Richard Greenfield at BTIG Research noted that Disney’s venture may be hurt by long theatrical “window” that keeps films out of streaming for months, and from longstanding deals giving rivals some of its content.
“We wonder how the company will explain what is and is not available on Disney+ both domestically and abroad,” Greenfield said in a research note. “Will consumers understand that a new Marvel movie is available in theaters, but not on Disney+ for eight months?“
John Meyer, analyst at the investment firm Transpire Ventures, said Netflix still has the upper hand in the market.
Meyer said Disney may “carve out a small niche” among families and young viewers but doesn’t pose a serious threat to Netflix.
“Netflix now knows what people want more than anybody,” Meyer said.
“After all, they are a tech company at heart and have enormous power with the data they capture on their millions of subscribers, which helps them design what original content to create.”
Laura Martin, analyst at Needham & Co., disagrees, saying Disney with its well-known brands and franchises will eventually overwhelm Netflix.
“We believe Netflix cannot win” such a war because of Disney’s cost advantage from owning a vast amount of content.
“Disney products reach 100 million households per year, which lowers Disney’s customer acquisition costs,” Martin said in a note to clients.
Martin said that in polling, US customers say they plan to use only two or three streaming services and that as a result, any growth in Disney+ will significantly weaken Netflix.


Research shows ‘mobile-first’ strategy is key to reaching more Saudi consumers

Updated 10 August 2020

Research shows ‘mobile-first’ strategy is key to reaching more Saudi consumers

  • The “demand for TV-quality mobile content is growing faster than ever,” with 87 percent of Saudis watching more videos on their smartphone
  • Saudis spend a daily average of four hours on their mobile phones for entertainment

DUBAI: The majority of Saudis are watching videos on the mobile phones, according to a report commissioned by social media giant Snap Inc.

The study, conducted by independent market research company The National Research Group, examined how the younger generations – Gen Z and Millennials – consume mobile content in their daily lives.

It noted that “demand for TV-quality mobile content is growing faster than ever,” with 87 percent of Saudis watching more videos on their smartphone than a year ago.

The research also showed 96 percent of the surveyed population preferred videos that appear vertically on their screens because they are “more personal” while 94 percent described this format as “more immersive.”

“We have seen a drastic shift in how people choose to communicate and consume media and mobile video has become at the forefront of storytelling,” Hussein Freijeh, Middle East and North Africa Regional Director of Snap Inc., said in release.

Saudis spend a daily average of four hours on their mobile phones for entertainment, the research found, much less in comparison to an hour and 58 minutes spent watching TV.

The younger generations also showed more preference towards short-form videos, saying they fit better into their routines.