How Many Subscribers Disney's New Streaming Service Will Need To Break Even
Disney is looking to go big in the streaming game. The entertainment juggernaut recently announced that it was launching its own streaming service that would be the exclusive home to its massive library of film and TV shows. In addition, subscribers will also be able to find Pixar, Marvel, and Star Wars films on the platform. It's a massive undertaking by Disney, and while some fans might be salivating at the idea of unrestricted access to their favorite titles, the company needs a LOT of people to feel the same way. According to new data, they needs 32 million subscribers to just break even on the venture.
A one-stop shop for favorite Disney titles is a pretty solid idea for a streaming service, but it won't be so easy for the idea to start seeing huge profits. On the new streaming service, subscribers will find 400-500 movies and around 7,000 episodes of TV, as well as exclusive new content that will range from live-action movies to TV shows. That is a lot of content right there, and it doesn't come cheap. According to a report from UBS analysts (via Business Insider), the future growth the streaming service will provide the Mouse House is attractive, but it'll be losing revenue from licensing out content to third parties. For example, licensing through Netflix is worth $500 million. That's money Disney won't get anymore, and its film and TV licensing alone is worth $2 billion a year. Thus, it needs 32 million subscribers to break even at $9 per month.
But that shouldn't be hard, right? Who would turn down a service that has near unlimited Disney classics and more modern hits like Beauty and the Beast and Rogue One: A Star Wars Story? Well, in the streaming world 32 million subscribers is still a high bar. Netflix has 50 million subscribers domestically, having offering streaming content for over a decade. HBO Now was at 3.5 million subscribers this summer, while CBS All Access and Showtime combine at 4 million for the year. Getting 32 million could take some time, but maybe we shouldn't underestimate the power of Disney fandom just yet.
Last month, Disney announced that it would be launching its own streaming service and that it would be pulling its content from Netflix. This includes high profile blockbusters from Marvel and Star Wars such as Captain America: Civil War, Doctor Strange, and the aforementioned Rogue One. The unnamed streaming service checks just about every box in all quadrants, having something for families and fans of blockbusters.
Only time will tell if Disney will be able to get to 32 million subscribers quickly. It's hard to imagine that any streaming service can reach over half of Netflix's domestic subscribers in any fast amount of time, but it never pays to underestimate the house of the mouse.
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Matt has lived in New Jersey his entire life, but commutes every day to New York City. He graduated from Rowan University and loves Marvel, Nintendo, and going on long hikes and then greatly wishing he was back indoors. Matt has been covering the entertainment industry for over two years and will fight to his dying breath that Hulk and Black Widow make a good couple.
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