Netflix stocks dropped after Disney+ details were revealed. So far, 2019 has been a big year for Disney. Upcoming potential blockbusters like the live-action remake of Aladdin, as well as Toy Story 4 and Star Wars: The Rise of Skywalker aside, The Mouse House recently completed their acquisition of Fox, and come next fall they’ll launch their own streaming service, Disney+.
To date, Netflix has far and away been the leader in terms of streaming services, and many have gotten used to the provider’s unchallenged status. That being said, change has been in the works for several years now as a wide variety of new streaming platforms have begun to crop up. Some, like the Criterion Collection or YouTube, focus more on niche markets and don’t offer Netflix much to worry about at all. In terms of the widest and most diverse amount of selection right now, however, Netflix continues to maintain their status as top dog. That being said, this status is getting set to face a multitude of new challenges, as the likes of Apple TV+ and Disney+ gear up to wage a serious battle for supremacy over streaming.
The most recent evidence of a potential big change coming shows that since Disney+ announced their full list of programming and pricing, Netflix has already seen their shares drop. According to CNBC, Netflix shares dropped 4 percent in light of Disney’s recent announcements, meaning a loss of around $7 billion from Netflix’s market value. This does indeed sound like a lot, but it’s important to remember that the streaming giant’s market share has been up about 14 percent for the past 12 months.
There’s no doubt that Netflix is going to see some real competition when Disney+ launches this coming November, and it’s not just because the entertainment conglomerate is one of the biggest in the world, either. Disney’s recent acquisition of Fox, as well as their efforts to remove all of their films and television programs from other streaming services, means that a large percentage of programming will be taken away from Netflix. What’s more, in terms of pricing, Disney+ is charging almost half as much as Netflix, with introductory pricing of their new service to be set at $6.99 per month (or $69.99 per year), as opposed to Netflix’s standard pricing plan, which is set at $13 per month. Netflix CEO Reed Hastings has previously stated that he’s not worried about growing competition from bigger providers, and recent efforts to increase the production of Netflix’s original content, as well as big wins at this year’s Oscar ceremony, has left the streaming platform in good shape.
Ultimately, exactly who nabs the title of biggest streaming service provider will come down to who can offer customers the most. While Disney+ will have a considerable amount of familiar and very popular titles, it’s clear that the service will focus on family friendly content - as will Apple TV+ when it arrives this fall. What arguably will eventually hurt Netflix, then, is its apparent insistence on raising its prices, as well as its refusal to understand that a large library of content is only impressive if that content is actually in demand by subscribers. If Disney+ can create a legitimate challenge to these Netflix negatives, then a new king could very well be on the way.
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Source: CNBC
