The entire on-demand digital entertainment sector was shaken and stirred, when Disney declared independence from the shackles of Netflix.
In a huge strategic shift, Disney has decided to pull out every movie from Netflix’s platform, and launch their own streaming service, which will showcase Disney’s own movie, branded their own way.
Besides, a new streaming service, included within their on-demand entertainment bouquet would be launched, focussed only on sports events.
Can Disney singlehandedly disrupt the industry?
Disney To Netflix: Goodbye
The day Walt Disney Co. announced their weak fiscal third-quarter earnings, they made this break-up announcement which is being regarded as a huge setback for Netflix.
As per Disney’s declaration, they will end all distribution agreements with Netflix starting 2019 calendar theatrical slate, and this, Netflix users won’t be able to access Disney movies henceforth.
This means that movies such as Toy Story 4, Frozen 2, and live-action The Lion King would be exclusively available only on Disney’s own streaming channel.
Analysts are saying that this is a huge coup made by Disney, as they have the most powerful content library, anywhere in the world. Now, Disney thinks that they can launch their own digital channel for end-users, and this is a paradigm shift in the way 118 year old Disney has worked.
Disney Chief Executive Robert Iger said, “No one is better positioned to lead the industry into this dynamic new era, and we’re accelerating our strategy to be at the forefront of this transformation,”
Netflix’s shares already dropped 5% after this announcement.
Disney’s Next Move: Disruptive?
To power their digital streaming services, Disney has bought majority stake in BAM Tech, by paying $1.8 billion. Last year, they owned 33% stake in the same company, by buying out from digital media company MLB Advanced Media.
Besides starting their own on-demand streaming service from 2019, Disney will also their ESPN powered sports event streaming services, wherein 10,000+ sporting events would be streamed, which includes MLB, NHL, MLS, collegiate sports and tennis’ Grand Slam events.
Although Disney movies would be available on Netflix all through 2018, every Disney title, including Pixar’s would be removed after that. Some reports claimed that Marvel TV Shows would be available on Netflix after 2018 as well, but the reports are not confirmed.
It would be interesting to observe how this changes the on-demand entertainment niche: Will every production house and entertainment conglomerate will launch their own streaming channel now? How will content aggregators like Netflix respond now?
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