Disney+ examined and compared

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Disney unveiled its new streaming service last week, and the investment community has studied the promised offerings and pricing strategy, in particular with its impact on European broadcasting.

Disney+ is set to launch on November 12th in the US with a Western Europe roll out planned for Q2 2020. The basic package price will be $6.99/month, in line with consensus expectations and below the basic Netflix package at $9. By 2024 the group aims to reach 60 million – 90 million subscribers and expects one third of those subs to come from the US and in the mid-term.

Disney+ is planned to be profitable by 2024 with most of the losses expected in the next two years. Disney suggested it could lose up to $150 million ($100 million studios and $50 million in the network) of licensing revenues in FY19 due to the termination of some of its contracts as it launches Disney+.

Disney+ is planned to be anchored by Disney Studio, Pixar, Marvel, Lucasfilm and National Geographic content. It will also feature an array of exclusive original series and movies – including a live action Star Wars series, and multiple live action Marvel series. Disney’s other video platforms, for instance Hulu and ESPN+, will remain independent.

RTL, according to equity advisers at investment bank Exane/BNPP, is the only pan-European broadcaster whose online VoD pricing is currently public. RTL charges €4.99 per month for its bundle (from €2.99 previously).

For comparison, Netflix charges €7.99 per month for its basic package across Europe, in line with Amazon’s subscription price. Netflix has now announced a price rise for subscribers in Germany, Austria, Switzerland and Lichtenstein with immediate effect (to €12, from €8 for basic tier). “We expect Netflix to raise prices across Europe to the same level,” says the bank.

The launch of Disney+ will feature an elaborate marketing campaign paired with key events around new movies. Disney aims to have reached 95 per cent awareness at the Disney+ launch among its target group. To give some context Apple’s SVoD app will be launched in 100+ countries in the autumn.

As to promised rival services (to Netflix, Amazon Studios and now Disney) the bank’s report says:

  • Germany. The revamped TVNow, RTL’s VoD platform, has already been launched. ProSieben plans to launch its new 7TV SVoD platform in summer 2019.
  • France. Salto, the French OTT joint venture, which is expected to combine the content catalogues of France TV, M6 and TF1, is expected to be live by year-end. The platform is subject to approval by the competition authority.
  • UK. The BBC / ITV Britbox streaming platform is expected to launch in the second half of 2019.
  • Spain & Italy. The HbbTV-based platform created by Atresmedia, Mediaset Espana and RTVE was launched last year. The platform currently offers seven-day catch-up and a better electronic programming guide and also allows viewers to watch from the start of a programme currently on air. This platform is expected to develop into an OTT TV service in a later stage. Mediaset Play offers live streaming and restart features for the Italian broadcaster’s channel portfolio. It also offers access to some on-demand content.

“RTL has announced €350 million investment in its SVoD platform over the next three years, of which €300 million is dedicated to new and exclusive content. ProSieben will invest c€100 million pa over the coming four years jointly with Discovery. The investment will be spread across content, tech and other costs. ITV has guided for incremental SVoD investment of £25 million in FY19 and £40 million in FY20, of which most dedicated to content. The size of the investment is set to decline thereafter. France TV, TF1 and M6 are each expected to invest €15m in Salto,” adds the bank.


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