Shares in Walt Disney surged to an all-time high on enthusiasm for its coming streaming service, Disney Plus.
The platform, which debuts on November 12, is priced at $7 (€6.20) a month in an aggressive challenge to rivals Netflix, Amazon Prime, and others in the crowded field.
Disney will also contend with a new streaming service from Apple, which is expected to be released in the autumn.
Apple has not yet said how much its service will cost or when exactly it will launch.
Investors cheered the strategy, sending Disney shares up as much as 11% in New York trading.
Netflix dropped as much as 2.1%. The company unveiled the service on a sound stage used to make the original Mary Poppins, delivering an Apple-style presentation of the online product.
The platform will cost less than Netflix’s most popular plan, at $11, and will weigh heavily on Disney’s finances.
The Disney streaming service isn’t expected to break even for about five years.
Beyond the price and technology, the service will live or die based on its content — and that’s where Disney made a big statement.
Disney will feature an arsenal of children-friendly programming, including 13 classic animated movies, 21 Pixar features, original series, and material its Marvel and Star Wars franchises.
“We are confident this is a product people are going to sign up in droves to have,” said chief executive Bob Iger.
Disney will begin rolling out to the US, western Europe, and Asia near the end of the calendar year.
It will then arrive in eastern Europe and Latin America a year later.
Disney plans to spend $1bn on streaming programming in the next year, and it doesn’t expect to make a profit until 2024, when the platform could have 60m to 90m customers.
Two-thirds of those subscribers will be overseas, predicts the company.
Disney streaming will also include The Simpsons, acquired in Disney’s purchase of 21st Century Fox’s entertainment assets last month.
Disney said films would become available on its streaming service only after the traditional cinema release period and home movie debut, which includes DVDs and purchasing streaming videos.
That includes Captain Marvel and the upcoming Avengers: Endgame, Aladdin, and Toy Story 4.
That puts its schedule behind that of some competitors.
Netflix films such as the award-winning Roma and The Ballad of Buster Scruggs have either become available for streaming on the same day or just a few days after their short runs in cinemas.
New shows on tap for Disney Plus include The Mandalorian, the first live action Star Wars series, created by Jon Favreau; a prequel to the Star Wars film Rogue One, starring Diego Luna; a series about the Marvel character Loki, starring Tom Hiddleston; a rebooted High School Musical series; and a new documentary series focused on Disney.
The company previously had deals with Netflix and others to offer its content, but Disney gave up those partnerships — and the revenue — to make its own service more desirable.
With nearly 140m worldwide subscribers, Netflix has already proven its mettle while warding off one competitive threat after another in the 12 years since it pivoted from DVD-by-post rentals to video streaming.
Now, Netflix is locking horns with a company that has been steadily expanding upon its Disney franchise during a shopping spree that has seen it snap up other major studios.
Bloomberg, PA
