Disney leaving Netflix to start its own streaming service


Streaming video giant Netflix, Inc.

Disney is saying goodbye to Netflix and will aggressively enter the crowded subscription streaming market.

Disney's plans for its own streaming services come as ESPN has struggled with a drop in subscribers and ad revenue as well as a round of high-profile layoffs and departures at ESPN earlier this year and in 2016. We know Netflix will continue to make TV shows like Luke Cage and Jessica Jones, but what will happen to its film catalog is less clear.

Several days before Disney officially announced its bold move, Netflix already made moves of its own. There's no confirmation whether the Disney content available on Netflix's catalogue in the United Kingdom will be affected, nor is it clear whether the service (if rolled out to the UK) will replace or be an extension of DisneyLife, Disney's existing app-based video service. There are hundreds of films, and thousands of TV episodes available on there for a monthly fee. "Individual sport packages will also be available for purchase, including MLB.TV, NHL.TV and MLS Live". And there are so many these days, you might end up spending about as much as you would for cable service.

To do this, though, it needs the streaming technology.

Less than a year ago, Disney forged a movie streaming partnership with Netflix. It will acquire a further 42% stake in the company at a cost of United States dollars 1.58 billion.

While Iger said it was thinking about doing a streaming service for both its Star Wars and Marvel franchises, it's more than likely that they will be integrated at some point into this new streaming service. When you think about live sports and how much a sporting event live is consumed basically concurrently by the masses, you need a very, very robust technology platform to serve that.

However it chooses to do it, its model will be watched carefully by other big distributors. CBS Corp's (CBS.N) newer digital subscriptions, CBS All Access and its Showtime offering, are on track to have a combined 4 million subscribers by the end of this year, the company said on Monday.

Disney, which also owns the ABC television network, said its consumer channel would include its Disney and Pixar movies and content from the Disney Channel, Disney Junior and Disney XD.

Netflix is savvy though. Today, that deal is (mostly) dead. It has also had great success with its own properties, though many of these have a Marvel flavour to them.

The Walt Disney Company Q3 results by segment.

2019 is a significant year for Disney.

Disney also announced it will launch its own streaming services, and plans to acquire a majority stake in BAMTech, a major streaming and marketing service.

Now, that would be a Force to be reckoned with.