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Disney Rolls Out Disney+ Service, Stirs Up Streaming War

Vasundhara Sawalka

Disney DIS launched its much-anticipated streaming service, Disney+ in the United States, Canada and The Netherlands on Nov 12. The streaming service is set for a Nov 19 roll-out in Australia and New Zealand.

Moreover, on Mar 31, 2020, Disney+ will be unveiled in markets across Western Europe, including the U.K., France, Germany, Italy, Spain, and other countries.

The service will offer nearly 500 movies and 7,500 episodes of television from brands such as Disney, Pixar, Marvel, Star Wars and National Geographic and Disney+ originals.

Users can create up to seven unique profiles for different viewers in each Disney+ account, and stream up to four different programs simultaneously on four separate screens.

Also, Disney+ will cost $6.99 a month or $69.99 a year. Notably, the service can also be purchased in the United States as part of a bundle that includes Hulu (with ads) and ESPN for $12.99 a month.

The Walt Disney Company Price and Consensus

The Walt Disney Company Price and Consensus

Disney+ Availability

Disney+ is available on most connected TVs, streaming media players and game consoles. It is also available on mobile devices through Apple’s App store or Google Play.

Moreover, the service will be available to users on the direct website and through in-app purchase from partner platforms and devices, including Apple’s AAPL iPad and iPhone, Google’s Android Phones and Chromecast, Roku players and SmartTVs, Sony (Sony TVs and Playstation), Microsoft (Xbox One), and Smart TVs by LG and Samsung, among others.

Per a CNET report, Disney struck a deal with Amazon AMZN recently, making Disney+ available to users on Fire TV Devices, Fire TV Edition Smart TVs and Fire Tablets as well.

Further, Verizon will soon be offering all its new and existing wireless customers on unlimited-data plans a free year of Disney+ viewership.

Disney’s Strong Content Line-Up for Disney+

Series exclusive to the service include The Mandalorian which is the first live-action Star Wars series, High School Musical: The Musical: The Series, The World According to Jeff Goldblum from National Geographic; Marvel’s Hero Project, short-form series Pixar IRL and Disney Family Sundays and Encore! executive-produced by Kristen Bell.

Additionally, Disney+ features three of the four highest grossing films of all time, including Avengers: Endgame, Avatar and Star Wars: The Force Awakens.  

Movies from the Marvel Cinematic Universe (MCU) are also included in these offerings. Marvel television series from the 1970s to present day, including X-Men, Spider-Man, and Marvel’s Runaways are also part of the content library.

Also in the library are all six of the original classic Star Wars films released between 1977 and 1999, in addition to the recent blockbusters Star Wars: The Force Awakens and Rogue One: A Star Wars Story. The entire Skywalker saga is expected to be available on the service by the end of next year.

Growth Expectations, Investment Details

Disney+ is expected to have between 60 million and 90 million subscribers globally by the end of fiscal 2024.

The company projects license content expense related to Disney+ to be less than $1.5 billion for fiscal 2020, with the same likely to increase to the mid-$2-billion range for fiscal 2024.

Additionally, total operating expenses for Disney+, which include marketing, technology, customer service, billing, and G&A expenses, is estimated to be slightly less than $1 billion for fiscal 2020.

Furthermore, Disney will spend $1 billion in cash on original programming for Disney+ in fiscal 2020. Spending on Disney+ originals are likely to flare up to around $2.5 billion by fiscal 2024. The company expects Disney+ to achieve profitability in fiscal 2024.

Disney+ Joins a Crowded Streaming Space

Disney+ is the latest addition to the increasingly-crowded streaming space, currently dominated by Netflix NFLX and Amazon prime video. Other notable incumbents include Apple TV+ (launched on Nov 1), HBO max and NBCUniversal’s Peacock.

Per Digital TV Research report, Disney+, along with Netflix, Amazon, Apple TV+ and HBO Max, will have 529 million subscribers by 2025. These services are expected to add 257 million subscribers between 2019 and 2025.

Disney+ is anticipated to reach a total of 101 million subscribers, most among these service providers, trailed by Netflix, during this time frame.

Zacks Rank

Currently, Disney carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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