News Disney announces strategic restructuring of media and entertainment divisions.

[Jrb1979]

Hopefully a large number if Disney is putting all their chips on it.

I have my doubts. Even if a large number subscribe, how many will get it for free.

 

[_caleb]

I have my doubts. Even if a large number subscribe, how many will get it for free.

The free subscriptions are not going to continue forever. Disney knows they needed to go big if the service was going to be successful. They’re getting lots of of people signed up, putting all their content into the library, and going big with lots of new content. Not only does this get people hooked on Disney content, it also allows Disney to collect lots of user data so they can produce the content people actually want to watch.

 

[_caleb]

To Disney, the success of The Mandalorian means that the assembly line output of franchise content is a good idea. That's why they're working on several other Star Wars shows for Disney+. Disney thinks people want more Star Wars instead of thinking broadly about how people want good quality shows.

What about all the other content Disney is working on? I know there’s going to be a lot of reboots, sequels, and prequels, but not everything is assembly line franchise content.

Of course the success of the Mandalorian will translate to new Star Wars series (hopefully more like the Mandalorian). But Disney is in data collection mode right now, and they’re learning what people actually watch. They know that there’s the nostalgia factor (new series based on Lizzy McGuire, The Sandlot, Monsters Inc, and Beauty and the Beast), a bunch of family-oriented documentary series, and more superhero stuff (which will probably also be the assembly line you’re talking about).

 

[_caleb]

Hopefully a large number if Disney is putting all their chips on it.

Disneyland has about a million annual passholders, and WDW has far fewer than that.

Netflix brought in $20B from its 192 million subscribers in 2019 (Disney+ currently has 60 million subscribers). That’s a large number.

 

[Jrb1979]

Disneyland has about a million annual passholders, and WDW has far fewer than that.

Netflix brought in $20B from its 192 million subscribers in 2019 (Disney+ currently has 60 million subscribers). That’s a large number.

I don't see how Disney gets much more then that many subscribers.

 

[TrainsOfDisney]

Disneyland has about a million annual passholders, and WDW has far fewer than that.

Netflix brought in $20B from its 192 million subscribers in 2019 (Disney+ currently has 60 million subscribers). That’s a large number.

Yeah but Disney World has 60 million annual attendance and a 1 day ticket costs more than a full year subscription Disney+.

I’m not even saying Disney+ is a bad idea. As a customer I like the product. I just think it’s a strange place to focus on business wise.

 

[TrainsOfDisney]

I don't see how Disney gets much more then that many subscribers.

It will be interesting to watch. Consumers don’t want multiple subscriptions.

Disney does offer a really impressive catalog, but Netflix was the first to the party and I don’t think they will lose much more of the market to Disney. Some may even switch back to Netflix after watching what they wanted to watch on Disney+.

 

[_caleb]

I don't see how Disney gets much more then that many subscribers.

There are currently 800 million streaming subscribers around the world. Globally, only 12% of households subscribe to a streaming service (40% of U.S. households currently subscribe). Disney+ is currently positioned with a low enough price (and solid enough content) that people are willing to subscribe even if they also subscribe to other services. There’s plenty of room for growth.

 

[_caleb]

Yeah but Disney World has 60 million annual attendance and a 1 day ticket costs more than a full year subscription Disney+.

I’m not even saying Disney+ is a bad idea. As a customer I like the product. I just think it’s a strange place to focus on business wise.

What about the news that Disney is focusing on streaming means that they’re not still going to make money at the parks?

 

[_caleb]

It will be interesting to watch. Consumers don’t want multiple subscriptions.

Disney does offer a really impressive catalog, but Netflix was the first to the party and I don’t think they will lose much more of the market to Disney. Some may even switch back to Netflix after watching what they wanted to watch on Disney+.

Netflix is losing a TON of content as more and more studios launch their own streaming services and keep their content for their own platforms. Netflix is left with a bunch of crap and their originals, which can be hit-or-miss.

You say consumers don’t want multiple subscriptions , but half of U.S. broadband households subscribe to two or more video streaming services. You may be right that subscribers will jump from service to service looking for something good to watch, but Disney’s current strategy is to be priced low enough that it doesn’t feel worth the trouble of dropping the subscription.

 

[J4546]

I think buying fox and acquiring star india and hot star is going to play a big part in disneys future globally. Star already has 600+ million subscribers in 100+ countries all over the world, 9 out of 10 households in india with cable use star india. and hot star, the streaming service has millions and millions more. I think that this investment will pay off big in a decade or so.

 

[ImperfectPixie]

There are currently 800 million streaming subscribers around the world. Globally, only 12% of households subscribe to a streaming service (40% of U.S. households currently subscribe). Disney+ is currently positioned with a low enough price (and solid enough content) that people are willing to subscribe even if they also subscribe to other services. There’s plenty of room for growth.

That's the rub. People cancel and re-subscribe all the time as they switch to streaming platforms that have what they want to watch. Disney needs to be ready to deal with that.

 

[_caleb]

I think buying fox and acquiring star india and hot star is going to play a big part in disneys future globally. Star already has 600+ million subscribers in 100+ countries all over the world, 9 out of 10 households in india with cable use star india. and hot star, the streaming service has millions and millions more. I think that this investment will pay off big in a decade or so.

Yeah, Disney is defiantly betting big on streaming. They know the competition is fierce, but they also see how much room there is for growth. They put nearly all their content in the Disney+ library, gave away a TON of free subscriptions, and were prepared to go a few years without making a profit. The COVID lockdowns worked in their favor in terms to subscribers and hours of video watched (lots of user data coming in), so now it’s a matter of whether they can put out enough content (and quickly) to keep people paying.

 

[Jrb1979]

Yeah, Disney is defiantly betting big on streaming. They know the competition is fierce, but they also see how much room there is for growth. They put nearly all their content in the Disney+ library, gave away a TON of free subscriptions, and were prepared to go a few years without making a profit. The COVID lockdowns worked in their favor in terms to subscribers and hours of video watched (lots of user data coming in), so now it’s a matter of whether they can put out enough content (and quickly) to keep people paying.

I have my doubts it will work. Having to put movies like Soul and Mulan on to Disney+ will end hurting them in the long run. Hoping that people won't cancel cause of price point is not a smart plan.

Part of this screams desperation to me. The part where you said they were planning on not making a profit for a few years and now hoping to make it profitable quickly is not a smart move. Putting Mulan and Soul onto Disney+ in hopes more people will subscribe is not smart. They will lose my money by doing it that way.

 

[_caleb]

That's the rub. People cancel and re-subscribe all the time as they switch to streaming platforms that have what they want to watch. Disney needs to be ready to deal with that.

Yeah. But as I mentioned, their current strategy is to be priced low enough that people won’t cancel. There is a psychological element to low monthly subscriptions that keep people paying, even when money is tight. And it makes it much easier for people who also subscribe to another service to rationalize paying for both.

 

[_caleb]

I have my doubts it will work. Having to put movies like Soul and Mulan on to Disney+ will end hurting them in the long run. Hoping that people won't cancel cause of price point is not a smart plan.

Part of this screams desperation to me. The part where you said they were planning on not making a profit for a few years and now hoping to make it profitable quickly is not a smart move. Putting Mulan and Soul onto Disney+ in hopes more people will subscribe is not smart. They will lose my money by doing it that way.

How will putting Soul and Milan on Disney+ end up hurting them? It‘s fresh content (which is something that matters to current subscribers) that also might also attract new subscribers.

It’s not desperation, it’s taking seriously their (late) entry into a new business. There is risk, but their plan B would be to put all their movies back into the Disney Vault and just to go back to the old model- theatrical film releases, licensed content, ABC/ESPN/Disney Channels, etc.

 

[TrainsOfDisney]

Yeah. But as I mentioned, their current strategy is to be priced low enough that people won’t cancel. There is a psychological element to low monthly subscriptions that keep people paying, even when money is tight. And it makes it much easier for people who also subscribe to another service to rationalize paying for both.

So what’s the plan? If they raise the rates people will cancel.

 

[_caleb]

So what’s the plan? If they raise the rates people will cancel.

Netflix raised their prices several times over the years. Disney will probably raise theirs too, eventually. Their pricing actually makes it much more difficult for Netflix to raise their prices. I think Disney will keep their prices low for a while—to build the user base, farm that valuable user data, and wait out all the resent competition (HBO Max, Peacock Premium, CBS All Access, etc.). Or, Disney could partner with those (as Hulu used to do) if it becomes clear they can’t compete. AppleTV+ is one that could hang on for a long while (Apple has plenty of money).

The Mulan “Premier Access” is an experiment to see if there are other ways to generate revenue without raising the Disney+ subscription price. They will probably continue to tinker with things like that.

Once there is a steady stream of serial content coming out, Disney will be able to raise the price and people won’t cancel.

 

[peter11435]

Yeah but Disney World has 60 million annual attendance and a 1 day ticket costs more than a full year subscription Disney+.

I’m not even saying Disney+ is a bad idea. As a customer I like the product. I just think it’s a strange place to focus on business wise.

Yes but those 60 million visitors were not entering on 60 million 1 day tickets. And the parks have huge overhead and operational costs and some pretty significant vulnerabilities.

 

[lazyboy97o]

Of course the success of the Mandalorian will translate to new Star Wars series (hopefully more like the Mandalorian). But Disney is in data collection mode right now, and they’re learning what people actually watch. They know that there’s the nostalgia factor (new series based on Lizzy McGuire, The Sandlot, Monsters Inc, and Beauty and the Beast), a bunch of family-oriented documentary series, and more superhero stuff (which will probably also be the assembly line you’re talking about).

Data collection is a problem. You don’t get strong creative content by working towards a survey. In fact you tend to get garbage because it’s too busy trying to appeal to actually do anything interesting.