Per Reuters, Disney’s DIS ESPN+ will be the exclusive distributor of Ultimate Fighting Championship’s (UFC) pay-per-view (PPV) events in the United States through 2025.
Notably, ESPN+ already had the media rights to UFC Fight Night. The recently expanded agreement between UFC and Disney now covers 12 live PPV events per year.
This year’s UFC PPV event will start on Apr 13. ESPN+ subscribers will have to pay $59.99 per event to access content. New subscribers need to pay $79.99 for their first PPV event and will get one year of ESPN+ access.
Disney Relying on Streaming Services to Grow Faster
Disney has three separate streaming services — ESPN+, Disney+ and Hulu — based on user content choices.
ESPN+, the gaming focused streaming service, has gained solid traction within a short period of its launch, primarily due to content strength. The service had 2 million paid subscribers at the end of fourth-quarter 2018.
Notably, Disney’s deal to air UFC fights on the ESPN platform, both linear and over-the-top (OTT), helped it gain 600K users. Now, the exclusive arrangement with UFC is expected to further boost subscriber base.
Moreover, Hulu’s content portfolio received a boost when Disney recently announced four animated series from its Marvel Studios. Hulu’s content strength along with price reduction of its basic ad-supported plan to $5.99/month is expected to attract subscribers. Notably, Hulu added 8 million U.S. subscribers in 2018, bringing the total count to 25 million.
Disney, which holds 30% of Hulu, is entitled to another 30% stake as it completes the acquisition of entertainment assets of Twenty-First Century Fox. Additionally, per media speculations, AT&T T is in discussions with Disney to sell its 10% stake in Hulu. Comcast CMCSA owns the remaining 30%.
Further, Disney+, which is expected to be launched by the end of the calendar year, will leverage Disney’s existing IP along with investments in original content. Notably, the upcoming service is expected to benefit from the popularity of Marvel characters. The company is working on a TV series based on MCU characters, including Loki and Scarlet Witch.
Disney+ is expected to disrupt the streaming space, owing to its strong content slate, brand name and ability to market the service. Notably, Disney+ is estimated to add 160 million subscribers worldwide, per J.P. Morgan as quoted by CNBC.
Stiff Competition in Streaming Market
However, Disney will face stiff competition in the streaming market not only from dominant players like Netflix NFLX and Amazon AMZN but also from new and upcoming entrants like Apple (AAPL) and Comcast’s division, NBCUniversal.
Notably, Apple is set to launch its much-anticipated video streaming service on Mar 25 that is likely to comprise a generous dose of free original programming along with subscription-based streaming offerings like CBS Showtime, Starz and Viacom. However, Netflix will not be part of Apple’s new offering as confirmed by CEO Reed Hastings
Nevertheless, strong content line-up is expected to help Disney quickly attract subscribers in the fast-growing streaming market.
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