U.S. markets closed

Netflix is shoring up its defenses for when it loses Disney content

Daniel Roberts

Disney, in its fourth-quarter earnings report on Thursday, revealed the official name of its forthcoming subscription streaming service: Disney+.

The product, which industry insiders nicknamed “Disneyflix” before it had a name, is “highly anticipated,” just as Disney CEO Bob Iger remarked in Thursday’s earnings press release. Disney+ is coming in 2019, and will boast a bevy of exclusive content from Disney Animation, Marvel, Pixar, and Lucasfilm. It should be particularly attractive to parents, with Disney family content they won’t be able to find on any other service.

And Netflix knows it.

It’s no coincidence that Netflix this week announced a buffet of forthcoming original animated shows and movies, set for release through 2022. The titles include original series and movies, and many of them have big names attached, like “Go! Go! Cory Carson,” a pre-school series coming in 2019 from the executive producers behind “Wall-E,” “Ratatouille,” and “Finding Dory”; “Trash Truck,” an animated series coming in 2020 from the executive producer behind “The Little Mermaid,” “Aladdin,” and “Beauty and the Beast”; and “The Willoughbys,” an animated film coming in 2020 starring Ricky Gervais, Maya Rudolph, Will Forte, and Martin Short.

Add those to the already-announced Netflix original “Pinocchio,” coming in 2021, which is the first animated film directed by Guillermo del Toro and is sure to be extremely popular, and the live-action “Mowgli,” hitting Netflix next month. That film is directed by Andy Serkis (of “Lord of the Rings” and “Planet of the Apes” fame) and stars the voices of Christian Bale and Benedict Cumberbatch. Its trailer, released this week, is making waves. If “Mowgli” looks familiar, its because Disney released its own live-action “Jungle Book” just two years ago.

Netflix’s “Mowgli: Legend of the Jungle” movie, coming on Dec. 7. (trailer screenshot via Engadget/Oath)

Netflix says 60% of its members watch kids or family content each month.

But 68% of Netflix subscribers who have young children are not aware that Disney content will be pulled from Netflix come 2019, according to Business Insider research. When those parents fire up Netflix one day in late 2019 and suddenly can’t find the Disney content they want, will they drop Netflix?

Disney has not yet shared the Disney+ subscription price, but we do know it will be south of $10 per month, after Iger said on an earnings call last year that Disney’s plan is, “to price this substantially below where Netflix is,” though that is also, “reflective of the fact that it will have substantially less volume.”

Critics have harped on that last point—that Disney+ will not have a large library of content at launch. Still, a laundry list of big releases that Iger rattled off in August on Disney’s third-quarter earnings call raised eyebrows and generated buzz: “Captain Marvel,” “Dumbo,” “Avengers 4,” “Aladdin,” “Toy Story 4,” “Artemis Fowl,” Disney’s live-action “Lion King,” “Jungle Cruise,” “Frozen 2,” and “Star Wars: Episode 9” are all hitting theaters in 2019 and will all go straight to Disney+ after they finish their theatrical run.

That’s a powerful slate of content for Disney+ and a shot across the bow for Netflix.

On this week’s earnings call, Disney previewed even more content coming exclusively to Disney+ including a live-action Star Wars “Rogue One” spinoff series starring Diego Luna, and a live-action Marvel series centered around Loki, the god of mischief, starring Tom Hiddleston.

Mr. Incredible, left, and Jack Jack in “Incredibles 2.” (Disney/Pixar via AP)

All that said, the attractions of Disney+ by no means guarantees people will ditch Netflix. The streaming wars have not been a zero-sum game: each platform has its own key original series that have drawn new subscribers in, like “Transparent” and “The Marvelous Mrs. Maisel” on Amazon Prime, or “The Handmaid’s Tale” on Hulu Plus.

But Netflix is clearly taking no chances, shoring up its defenses in the kind of family content the Mouse House is known for. Come 2019, when Disney+ launches, prepare to watch a very public showdown between the two for the wallets of parents and families.

Daniel Roberts is a senior writer at Yahoo Finance and closely covers streaming tech. Follow him on Twitter at @readDanwrite.

Read more:

Sports media VC: ‘There’s going to be a Rupert Murdoch of digital’

Disney is playing the long game with its ESPN streaming product

Why Disney doesn’t need Netflix

How baseball’s tech arm got so big that Disney had to have a piece

Hulu skinny bundle is the latest sign of Disney yielding to cord-cutting