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Netflix isn't the only other streamer in town, but it is the biggest name on the board. Disney+ is viewed as the first serious competitor for Netflix, since it's the one fans seem to be most excited for -- much more than Apple TV+, HBO Max, and NBC's upcoming Peacock.
However, the Wall Street Journal reports that Disney had told staffers earlier in 2019 not to accept ads from any rival streaming services -- which would also include, say, Amazon. That decision was later changed in light of Disney's other business partnerships with various streamers and their parent companies. Disney doesn't want to burn every bridge in town just to support Disney+. The exception was Netflix. Netflix is still on the outs, except for on ESPN.
A Disney spokesperson shared a statement on the streaming ad decision (via CNBC):
The direct-to-consumer business has evolved, with many more entrants looking to advertise in traditional television, and across our portfolio of networks. While the initial decision was strictly advertising based, we reevaluated our strategy to reflect the comprehensive business relationships we have with many of these companies, as direct-to-consumer is one element.
According to the Wall Street Journal and estimates from ad-measurement firm iSpot.TV, Netflix spent $99.2 million last year on TV ads in the U.S. Of that, 13% went to Disney-owned entertainment networks. So Disney is saying no to a decent amount of money to shut out Netflix as part of a larger strategy to maximize its own brand. This also means Netflix can't air any ads during Oscars 2020, since the Academy Awards air live on ABC; so there goes the opportunity to promote high caliber Netflix Originals to millions of movie buffs.
These streaming wars are definitely getting interesting, and Disney and Netflix are far from the only players. Amazon is reportedly fighting with Disney over the right to sell a "substantial percentage of the ad space" on Disney apps in Amazon's Fire TV devices. The Wall Street Journal reports that fight is one reason why Fire TV doesn't have a deal in place yet to carry Disney+.
Apple+ is scheduled to launch November 1. Disney+ is set to follow November 12, with a bundle deal that includes ESPN+ and Hulu. Some analysts think Netflix is going to take a major subscriber hit after Disney+ arrives, but I'm with Netflix boss Ted Sarandos, who suspects many subscribers will add services like Disney+ but most will not cancel Netflix. Netflix still has unique content that keeps bringing people back, like Stranger Things or Lucifer, etc. So while Disney+ will also have unique Marvel and Lucasfilm content that fans will want, it's more likely fans will try to find a way to have both.
If anything, Netflix may have to get more competitive with its pricing, and possibly consider the previously unthinkable addition of ads. The streamer has already talked about learning to say no to more big-budget productions after some high-profile disappointments. Sadly, Netflix's cost ratio model also seems to be keeping it from renewing more original series after a couple of seasons; that could come back to bite it, though.
Maybe Netflix will have to re-evaluate some of its life choices after the dust settles from Disney+ and Apple. Or maybe Disney will realize it doesn't need to say no to Netflix ad money since there is room in the market for both of them. Besides, the news that "Disney banned Netflix" ironically gave Netflix plenty of free advertising. Not exactly a power move, Mickey.