The biggest loser in Disney’s road map to a November streaming service? Apple.
The iPhone maker had a March event where the company trotted out veteran celebrities like Oprah Winfrey and Steven Spielberg, in showcasing a lineup for a fall TV service. It just neglected to show any clips, name pricing or give a firm launch date.
The message: Apple was after star power to wean consumers from Netflix.
Disney, this week, had a different message: the strength of its brands.
“All Disney in one place never existed before,” Disney CEO Bob Iger told ABC’s Good Morning, America. “That’s (like) going to Disneyland every day of the week.”
You can excuse the hype, as the Disney Channel has existed on cable since 1983, and gave birth to future stars like Britney Spears, Justin Timberlake and Miley Cyrus. But that’s cable – yesterday – while streaming is the future.
Disney+ has announced that the streaming service will launch Nov. 12 for $6.99 per month. (Photo: Disney)
But it went way further than Apple at its launch event this week by actually releasing details. It named a price, $6.99 monthly, a launch date, Nov. 12, and a strategy. The service is going to feature movies from the Disney library (Cinderella, Lady and the Tramp), Pixar, Marvel and the Star Wars franchise, along with originals based on these properties, in addition to titles from the Fox library, which Disney now owns, like The Simpsons and National Geographic.
“Apple’s event was a C+,” says Dan Ives, an analyst with Wedbush Securities. “But Disney was an A+, with an Apple for the teacher. Iger just hit it right out of the park.”
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Ives is not alone in his assessment. The Hollywood Reporter’s Tim Goodman noted that Disney threw out an opening punch that landed at Apple headquarters in Cupertino. “Disney’s biggest bite is going to come out of Apple,” he wrote.
Many analysts had expected Disney to price the service higher and applauded the lower rate because it will attract more customers. Disney is clearly going after building up a huge subscribe base early. The company said it expects to have 60 million to 90 million subscribers by 2024.
Netflix currently has 140 million subscribers, and Amazon has said it has over 100 million paying members to Prime, the expedited shipping service that comes with music, TV and film content. No. 3 Hulu, which is now majority owned by Disney, has 25 million subscribers.
Disney said at its event that it might bundle Hulu and the Disney+ service together at a discounted rate. You can already get Hulu for free with a Spotify subscription.
Analysts have voiced concern over how the market will accept so many subscription services when the average home currently subscribes to two.
So where does this leave Apple?
Ives believes the company, which has historically priced products at a premium, will charge as much as $12 to $13 for Apple TV+, but that it will come bundled with other services.
He sees Apple offering several choices, like TV and the Apple Music service or Music and the new gaming service Apple will launch later this year.
Disney’s move is clearly bad news for the cable TV alternatives like YouTube TV, Direct TV Now and PlayStation Vue, which offer limited cable channels for $45 to $50 a month. Why fork over $50 when a combo of Netflix and Disney could be had for $20 or so?
Consumers will vote with their wallets in the fall when Disney+ and Apple TV+ launches. Also waiting in the wings: a new streaming service from Warner Media, which will also include library content from HBO, which has its own subscription service, HBO Now.
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