Disney's Streaming Services: Disney+ (and Hulu, ESPN+, Star, & hotstar)

Wendy Pleakley

Well-Known Member
The flagrant spending is a loss-leader so as to be one of the three remaining big streamers after the streaming wars are over.

It was the strategy of Amazon and Facebook. Years and years of deficit spending to kill competitors and then monopolize the space for profit.

Right now, Netflix and then Disney are in the lead. They intend to stay that way with yearly multi-billion dollar budgets for content. Disney is in the enviable position of owning a lot of disparate studios to churn out content for their own use. The other streamers have few studio-feeders and are bidding against one another to buy up content from the independent studios (which will likely be bought out by those streamers eventually).

The two CEOs have made it clear that streaming is priority #1 for the corporation and have put shareholders on notice of huge deficit spending in that department to make their streamers one of the winners of the streaming wars.

In addition to content, Disney is still spending huge amounts on infrastructure to make their streamers truly global. They expect their streamers to start to turn a profit in 2024 (I think).

Is Disney really losing money on Disney+? They have 118 million subscribers. That's a billion dollars a month.

The only major release this month is Boba Fett, which costs a reported $14 million per episode.
 

MisterPenguin

🐧🐧🐧🐧🐧🐧🐧🐧Fully Pfizered!🐧🐧🐧🐧🐧🐧🐧🐧
Premium Member
Original Poster
Is Disney really losing money on Disney+? They have 118 million subscribers. That's a billion dollars a month.

The only major release this month is Boba Fett, which costs a reported $14 million per episode.
If they weren't losing money on D+, they'd be in big trouble with Federal agencies for filing false financials.

The ARPU for all those subscribers is only around $3-4 (don't have time to look it up) globally because it's much cheaper in other parts of the world, especially India, where the average person has a lot less income compared to Americans. The heavy discounts and initial deals upon sign-up lowers the ARPU in order to saturate the market.

Disney is not only making content for the English speaking world, they're committed to original programming in all the local-language markets that they've entered. That's hundreds of millions spent on content for each market. They're basically running several dozen streaming services. Unlike Netflix, which basically does the same but 'airs' them on Netflix, we don't see all those new international shows on D+ in America, with the exception currently of Indian Hotstar content now on Hulu, and that one Latin American series they dropped into D+ last month.

Speaking of Hulu, D+ includes Hulu's library as Star outside the U.S. And so, the cost of Hulu's libraries and new shows are wrapped up with D+Star.

Then there's billions sunk into the infrastructure of servers to manage all the content. The administration of over 100 million accounts. The management of its library as it goes through and scrubs old content from Disney and Fox. Advertising. And so on...
 

DCBaker

Premium Member
"Disney+ is developing a series based on the 2011 movie that starred Hugh Jackman, Evangeline Lilly and Anthony Mackie.

The film, directed by Levy, followed an-boxer and father, played by Jackman, and son, played by Dakota Goyo, as they reconcile years of distance and discover an obsolete junkyard sparring robot who just might be more than it seems.

The series comes from Disney Branded Television and is produced by 20th Television in association with Levy’s 21 Laps, for its sister streamer.

The platform is currently searching for a writer for the series, which is exec produced by Levy, Robert Zemeckis, Jack Rapke, Jacqueline Levine, Susan Montford and Don Murphy."

 

Disney Irish

Premium Member
"Disney+ is developing a series based on the 2011 movie that starred Hugh Jackman, Evangeline Lilly and Anthony Mackie.

The film, directed by Levy, followed an-boxer and father, played by Jackman, and son, played by Dakota Goyo, as they reconcile years of distance and discover an obsolete junkyard sparring robot who just might be more than it seems.

The series comes from Disney Branded Television and is produced by 20th Television in association with Levy’s 21 Laps, for its sister streamer.

The platform is currently searching for a writer for the series, which is exec produced by Levy, Robert Zemeckis, Jack Rapke, Jacqueline Levine, Susan Montford and Don Murphy."

Sequel would have been nice, this is a good alternative.
 

NateD1226

Well-Known Member

DisneyFan32

Well-Known Member
In the Parks
Yes
Production begins in March


Expect more announcements like this throughout today because Disney is having their Winter TCA conference.
Sweet! I love all three Santa Clause films. Also:


The Proud Family: Louder and Prouder will coming to Disney+ on February 23rd.
 
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MisterPenguin

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Premium Member
Original Poster

LovePop

Well-Known Member
Is Disney really losing money on Disney+? They have 118 million subscribers. That's a billion dollars a month.

The only major release this month is Boba Fett, which costs a reported $14 million per episode.
The 118 million subscribers don't all pay $8 a month. The ones in India, for example, pay much less. "Disney said its average revenue from Disney+ subscribers is $4.52 per month," according to Fortune, Nov 13, 2020.

Generally, Disney's streaming unit loses $600 million a quarter, or over 2 billion last year, which is more than the year before, which lost $400 million a quarter, according to the New York times, Nov 10, 2021:

"A variety of costs (content production, marketing, technology infrastructure) contributed to losses of roughly $600 million for Disney’s streaming unit; losses totaled $400 million in the same quarter a year ago. Disney’s chief financial officer, Christine M. McCarthy, told analysts on Wednesday that Disney+ losses would peak in 2022 — instead of 2021 — because of pandemic-related disruptions to the service’s content pipeline."

The reason losses will peak this year is because Disney is increasing its spending: $33 billion this year, which is 8 billion more than last year's spending of 25 billion, on Disney+, Hulu and ESPN+, according to the Hollywood Reporter.

Personally, I think Disney going into streaming is a huge mistake made by Iger, and Disney+ will never make any money. Now Chapek is forced to throw more good money after bad. If the subscription numbers continue to fail expectations this year, Chapek will have no choice but to give it up by next year, just like the NBA experience.

 

doctornick

Well-Known Member
But a huge amount of the expense at this point is infrastructure- rolling out streaming is a large number of countries isn’t cheap. That cost will come down substantially in the future and the main expense going forward will be programming costs which can be managed more closely (plus there is an economy of scale with producing content since you can show it everywhere).

The biggest question to me is whether Disney can produce enough general interest programming to hook folks as a “regular” streamer like Netflix for those people who aren’t already engaged with existing brands of Disney/Pixar, Marvel or Star Wars. I think there’s a ceiling of subscribers that they can get if they stick to existing brands.

Still I like Disney’s prospects a lot more than other streams who have less of a hook of well established and beloved brands.
 

Animaniac93-98

Well-Known Member
The biggest question to me is whether Disney can produce enough general interest programming to hook folks as a “regular” streamer like Netflix for those people who aren’t already engaged with existing brands of Disney/Pixar, Marvel or Star Wars. I think there’s a ceiling of subscribers that they can get if they stick to existing brands.

They need this, which is why they have Star.

But they need the equivalent of Star in the USA and more brand awareness. I bet many people hear "Disney+" and just think of "Disney".
 

doctornick

Well-Known Member
They need this, which is why they have Star.

But they need the equivalent of Star in the USA and more brand awareness. I bet many people hear "Disney+" and just think of "Disney".
They have it in the US, it’s called Hulu and I think it’s reasonably well known.

The biggest barrier I think regarding integrating Hulu like they have done with Star is that Hulu has a live TV option so it’s also a competitor with Sling, YouTubeTV, etc.
 

BrianLo

Well-Known Member
I have no concerns with inevitable profitability. D+ is still in a growth phase and severely underpriced. Netflix did the same and now profitability is taking off as the subscription price has gone up.

I think there was a real concern Disney would wind up being a niche offering, but they are and have quickly become the number two by a wide margin.

Especially as we are increasingly getting the Hulu spillover as rights increasingly fall to Disney - I’m finding D+ is actually a superior product to Netflix in Canada. At least here year two was an extreme improvement.
 

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