Disney surpasses Netflix in global paid streaming subscribers

https://www.axios.com/2022/08/10/disney-surpasses-netflix-global-paid-subscribers

by thesecretceo • 4 years ago

156 131 4 years ago

routerl• 4 years ago

I remember when Netflix began to produce their own shows and movies, some C-suite exec saying something like "we're gonna become HBO before they realize they need to become Netflix". I.e. vertically integrated content production and distribution.

Well, wrong target I guess. Disney has always been the big player in this space.

bombcar8• 4 years ago

Turns out it’s much faster for a content producer to spin up a Netflix clone than vice-versa.

Some of this is not realizing just how much technology has advanced since Netflix was first mover - second mover often has much less problems in the area (especially as someone has already done the heavy work of showing it can be done).

plorkyeran• 4 years ago

Yeah, building Netflix when they first got into streaming was a massive technical undertaking. There were a lot of companies who tried very hard to do streaming video who just never got it to work well enough. Building a Netflix clone is still certainly not trivial by any means, but it's probably an order of magnitude less work than it was ten years ago. When they first shifted into original content production it didn't make sense for HBO to even try to compete with them, but those days are clearly long one.

dralley• 4 years ago

An ironic statement considering HBO has been doing vertically integrated content production and distribution for a pretty long time (though it took them a few years to take streaming seriously).

omegalulw• 4 years ago

Not a wrong target at all. Streaming is pretty much a solved problem now and Netflix is competing mostly on content.

kache_• 4 years ago

it's ogre :[

gz to disney plus team

madelyn• 4 years ago

Content is queen.

I cancelled my Netflix but Disney Plus is just worth keeping, even with the price hike coming.

christoph• 4 years ago

Same. It’s worth noting Disney only has a single plan which includes 4K, HDR, Atmos, etc, and in the UK is far cheaper - Netflix charge nearly £200 a year for their 4K plan (£15.99 x 12). Disney is less than half that on a yearly plan for £80.

Netflix is just simply massively overpriced now, in my opinion, even before you dive into the massive content advantage Disney have - almost everything ever made by Disney, Pixar, Star Wars, Marvel, National Geographic and the then the massive Star catalogue, which actually has a ton of decent movies and tv shows, new and old. Content is obviously highly subjective, but I lost track of the amount of times I’d open Netflix and spend 10 minutes struggling to find something worth watching in their annoying UI.

encoderer• 4 years ago

A nice headline but Netflix could probably add a lot of subs if they dropped prices down to $7.99 where Disney has had them.

pipeline_peak3• 4 years ago

The only way they can do that is with ads.

zinekeller• 4 years ago

Possibly misleading title? Still significant, but it includes all subscriptions including Hulu and ESPN+. Also did Disney account for possible overcounting (for example, there could be separate Hulu and Disney+ subscriptions and didn't took advantage of the bundle) or not?

pipeline_peak3• 4 years ago

Disney owns ESPN

Rebelgecko• 4 years ago

Right, Disney sells a bundle of Hulu, ESPN+, and Disney+. If you buy that bundle, it sounds like you'd be triplecounted

skinnymuch5• 4 years ago

Disney+ doesn’t own ESPN+ and Hulu. The clarity makes sense. Disney owns Hulu too.

candiddevmike• 4 years ago

How many folks are on the sweetheart deals Disney Plus had before they launch? I know I prepaid for at least two years, I think. Will be interested to see who sticks around.

radicaldreamer• 4 years ago

There were at least two 3 year promotional plans prior to launch that dropped down the effective price to under 5 dollars/month and under 3 dollars/month. Those are expiring in November, right on time for the rate hike.

underyx• 4 years ago

I'm using an Amex offer that gives 100% cashback on Disney+ subscriptions. Sounds like another fun way to game these numbers.

bombcar8• 4 years ago

I wish I could retroactively apply it.

CharlesW• 4 years ago

I'm using an Amex offer that gives 100% cashback on Disney+ subscriptions. Sounds like another fun way to game these numbers.

That "gaming" might be considered by some to be basic co-marketing and business development (which Netflix does too, of course). You've hit on a crucial point, though — Disney has an order of magnitude more relationships, subsidiaries, products, etc. to leverage than Netflix does. By 2025, Netflix will have been acquired by someone who can compete with that.

EddySchauHai2• 4 years ago

I can see this. Disney has some absolutely amazing content for many different groups of people while Netflix has become boring and stagnant. Nowadays I assume what I'm wanting to find isn't on Netflix and go straight to Prime to rent anyway. The only other competitor in terms of quality of content with their own content is probably Apple TV, with Ted Lasso and For All Mankind.

skinnymuch5• 4 years ago

That’s wild. Netflix makes so many more shows that are well received than Apple TV. Apple TV is tiny relatively speaking.

Amazon, HBO Max, maybe Discovery+, make enough content for streaming in enough quantity (so there’s enough higher quality stuff) that Apple TV can’t easily surpass them.

Some shows are basically streaming shows now any way even if they technically go on HBO at 11 pm or something (thinking of something like Nathan Fielder’s own show and the show he exec produces).

bombcar8• 4 years ago

Apple TV doesn’t have to surpass. They’re pricing themselves low enough to be everyone’s second choice, and low enough that you won’t bother to cancel. It’ll grow.

EddySchauHai2• 4 years ago

Oh for sure, I'm talking quality not quantity here though.

gregdoesit• 4 years ago

When I took my kid to Disneyland for the first time, I got the question on the way “dad, can we go to Netflixland as well?”

This question from a kid made me realize how much of an entertainment empire and revenue generator Disney is versus Netflix.

With Netflix, buying the monthly streaming service is the most you’ll spend. With Disney, it’s likely the least: the toys (with Disney royalties), the movie tickets for the family and finally - for some - a Disneyland trip where we dropped more over a few days than my lifetime Netflix spending will be.

The amount of investment that went into making Disney what it is today is incredible, and Netflix has a lot of catching up to do.

Will there ever be a ‘Netflixland’? Does Netflix even want to compete with Disney, head-on-head?

kgc• 4 years ago

Netflixland is actually a great idea. I would go.

JoshGlazebrook• 4 years ago

Imagine a stranger things themed section of a Netflix park. $$$$

Analemma_• 4 years ago

Walt Disney made a famous sketch of his business strategy with exactly this point: https://i.insider.com/55a6bb002acae74c2f8b48b8. He'd be pleased to see that, modulo a few updates for changing times (comic strips aren't much of a thing these days), it's still working pretty much exactly as intended.

dr_dshiv2• 4 years ago

Wow! 1957. Amazing flow chart.

bombcar8• 4 years ago

Disney ducks are still a bit of a thing in Europe I hear.

treespace8• 4 years ago

Yes, it all leads back to the park.

The only problem now, is the park isn't big enough! Imagine the amount of money a third park in America would make. (And cost)

mleo• 4 years ago

Disney owns Marvel Comics, and still pretty important for feeding ideas and promotions.

vanchor3• 4 years ago

What would Netflixland have? I feel like they don't own enough rights to most of their content to pull that off.

dymk• 4 years ago

Imagine living in the 80s, but everybody has a cell phone. That’s Netflix land

aczerepinski• 4 years ago

I want to ride the OA ride at Netflixland where the suspense and excitement builds up and you get a glimpse of the intense downhill part but then the ride just suddenly ends.

yablak• 4 years ago

Super sad panda face

game-of-throws• 4 years ago

I was on a rollercoaster at Netflixland, but I couldn't enjoy it because an employee was sitting next to me the whole time listing all the rides I should try next.

madrox4• 4 years ago

The short answer is...maybe. Franchises with sufficient power behind them usually end up with park deals. Universal operates the Nintendo park in Japan and Harry Potter. Disney is operating the Avatar park (before they even bought Fox).

scrumbledober• 4 years ago

I got some ads for a "Bridgerton Experience" and "Stranger Things Experience" in SF a few weeks ago. I thought "wow it would be cool if they did this for the content I'm more interested in," then realized that there's already Marvel and Star Wars themed sections of Disneyland. Bit different in the scale of their executions...

mr_toad• 4 years ago

dad, can we go to Netflixland as well?”

Who wouldn’t want to visit upside-down land?

jbergens• 4 years ago

There have been some articles about this idea but nothing seems to be decided. They may go into parks later or may not. Some thinks they may just license the IP so you could go to a Stranger Things ride in some other park. Building a park like Disney Land is very, very expensive.

siod• 4 years ago

It honestly feels like the technology advantage Netflix enjoyed has all but disappeared.

Content is now king and all of the other production companies have been making content for decades, Netflix is in serious trouble if it doesn’t lift its game.

xupybd2• 4 years ago

I find that Disney doesn't have better content, but it has new content. I've had Netflix for years and watched most of the stuff I liked. I got Disney and they had Castle. That's kept me going for months and I've not used Netflix since.

skinnymuch5• 4 years ago

You’re primarily watching one show? Realistically, any streaming service has a chance at providing that, no?

arrosenberg6• 4 years ago

To the extent they had or still have technology advantages, they are irrelevant. They do not own the majority of the best, most desirable content. Content producers have engaged in (anticompetitive) vertical integration wherein they also have become distributors. As happens in such situations, Netflix finds themselves squeezed out and taxed to death by monopolist studios like Disney, Paramount and Warner.

Solution: Fair, Reasonable and Non-Discriminatory (FRAND) licensing. Disney must set a price for a piece of content and then allow any distributor to pay that price to carry it. They must not advantage their own distribution service in any way (which they shouldn't be allowed to have in any case).

https://en.wikipedia.org/wiki/Reasonable_and_non-discriminat...

mappu• 4 years ago

It's the modern-day version of United States v. Paramount Pictures, Inc. where movie studios were banned from vertically integrating with theatres.

However I note on https://en.wikipedia.org/wiki/United_States_v._Paramount_Pic.... that the decree has just been sunset with the reasoning that ""the antitrust restriction was no longer necessary as the old model could never be recreated in contemporary settings"" - but it seems really like the exact same model,

tehwebguy2• 4 years ago

As long as Netflix renews I Think You Should Leave they’ll get at least one month of me subscribing every season.

yazaddaruvala2• 4 years ago

I'd love to one day read a case study about Netflix's choice to compete with Disney and HBO instead of competing with Akamai, Cloudflare, and Fastly.

They really had every possible advantage, and then instead re-built trash TV.

bombcar8• 4 years ago

I honestly suspect they believed that nobody else could build what they had because of how hard it was for them to build it.

But technology advanced fast and if your differentiator is tech you’d better watch out.

1adam1200• 4 years ago

I think if you look at the market caps of the companies you listed you’ll have your answer.

asdajksah2123• 4 years ago

Their technology advantage disappeared the day MLBAM started doing non-MLB stuff. You saw this most clearly with the HBO Go Game of Thrones season premieres. The first time they did it, it was with an in house solution built by a Microsoft veteran (who for some reason decided to build a team in Seattle), that absolutely failed.

The next season they outsourced to MLBAM and it was flawless.

And would you know it. Disney bought MLBAM.

Although now there are several content producers who can match up with Netflix, with their in house teams.

What I will never understand though was Netflix voluntarily choosing to eliminate the tremendous data collection operation they had in their rating system. One of Amazon's biggest advantages are the reviews. Netflix had that in the media space. They decided to throw it away for a system which has no user input (so no moat) where anything that is presented to you is invariably rated 99%. It makes absolutely no sense.

function_seven• 4 years ago

I remember actually rating shows and movies on Netflix. There were stars and I could give as many or as few as I wanted.

Now they give me some stupid thumbs-up/-down thing, and I just give them the finger in response. Ratings on Netflix are useless now.

I do have one huge bit of praise for them: the cancellation process was absolutely painless. Not being snarky, I really appreciated that! (Contrast with trying to cancel SiriusXM, or Spectrum Internet; both painful)

kderbyma• 4 years ago

Netflix doesn't care about product. they forgot about it when they started making content. that is why they will fail

madrox4• 4 years ago

Worth noting that they're surpassing Netflix by including ESPN+ and Hulu subs, so many customers are getting double or triple counted. It isn't just Disney+. Also, Disney has made a lot of partnerships to promote and sell subscriptions, such as through Verizon, which is usually how they end up growing their numbers so quickly. They usually include guaranteed minimums and I'm not sure how that's affecting this number. If I were an analyst, I'd love to know what percentage of subscriptions are coming through those deals, as they don't tend to create sticky customers.

Still an impressive achievement given how relatively new the service is, though. It's a testament to what a well oiled machine Disney is and their ability to pivot into new services.

pipeline_peak3• 4 years ago

Disney owns ESPN, has for a long time

madrox4• 4 years ago

Indeed, and ESPN has always been far and away the largest source of revenue. In fact, the earnings call where Disney beat expectations but cable subs to ESPN dipped by half a percent saw a total run on the stock. ESPN+ is what they're hoping to wean cable users onto.

I suppose I should disclaim that I used to work there :)

adoxyz• 4 years ago

And Disney owns 67% of Hulu.

jjcon• 4 years ago

Right, which is why they probably shouldn’t be double or triple counting subscribers.

aardvark179• 4 years ago

Maybe they are double counting Hulu and ESPN subs in the US, but not internationally. We don’t get those services at all in the uk and are slightly bemused when Disney proudly announce the more adult series that are now on Disney+ because we’ve had them for months.

mastazi• 4 years ago

Same in Australia. We don't get Hulu and ESPN+ but they launched a new section within the Disney+ service, called "Star", that includes more "adult oriented" movies and shows.

vlovich123• 4 years ago

Why are you framing it as double or triple counting? If I’m subscribing to Disney+ and ESPN+, I’m paying Disney twice. Unless you’re suggesting that paying for the Disney bundle is being counted as 3 separate subscriptions?

madrox4• 4 years ago

Because the title frames it as subscribers; not subscriptions. Disney probably doesn't have more subscribers than Netflix, but it has people paying Disney two or three times, as you say.

slg2• 4 years ago

That means I am counted 3 or possibly even 4 times without paying a cent to Disney directly. I have an old Spotify Premium account that came with Hulu for free and now I have a Verizon Unlimited plan that includes free Disney+, ESPN+, and another Hulu subscription. Just goes to show that not all subscribers are created equal.

thaumasiotes• 4 years ago

That means I am counted 3 or possibly even 4 times without paying a cent to Disney directly.

The fact that you're counted several times is a relevant complaint about their published subscriber count; the fact that you don't give money directly to them isn't.

majormajor• 4 years ago

Did you actually activate all the separate subscription accounts for those partnerships? Especially the 2 Hulu free ones - if so, why?

Rackedup• 4 years ago

Since you have the Verizon Unlimited plan, Verizon can afford to pay Disney for you (that plan, and Verizon isn't cheap).

giancarlostoro• 4 years ago

I dont even use espn+ its just bundled with my Hulu subscription, I literally do not care for major league sports. I rather just play with friends instead.

But yeah if they are counting people like me and not Daily Active Users across platforms they are foolish.

homeland221• 4 years ago

A lot of Disney+ subs are "free" packaged with other mobile deals. I know plenty of people gotten a full year Disney+ free. Give it abother 2-3 years. See how well it sustain giving free subs.

tehwebguy2• 4 years ago

American Express is paying for quite a few of them too I bet, the Platinum card comes with a $20 / mo “digital entertainment” credit valid that can be used on Audible, Disney+, The Disney Bundle, ESPN+, Hulu, Peacock, SiriusXM, and The New York Times

vbcr• 4 years ago

Also in India, Disney+ is called Disney+Hotstar which is a much cheaper alternative to Netflix. Their most expensive plan is ₹1500/year compared to Netflix's ₹7788/year. Even Netflix's basic plan in India is ₹2388/year.

kayxspre• 4 years ago

In Thailand, which Disney+Hotstar also operates, its yearly pricing is $23 (can be as low as $14 if subscribed from an eligible mobile carrier). Netflix pricing for an equivalent (2 streams) are $10/month or $118/year, a huge difference. Even Netflix's super basic plan (1 mobile-only stream) starts at $3/month or $33/year.

esel2k• 4 years ago

Is there a reason that there is no de duplication? I wonder if Privac Notice and T&C prohibit to exchange data on a personal level (identifying level)? Does one know what is allowed or not if these are separate entities?

ycta2022081011• 4 years ago

I predicted this would happen as soon as Netflix raised prices earlier this year. They have over 220 million global subscribers, almost the population of the entire United States, but think they aren't making enough money and are investing the money they do have into hair-brained projects like mobile games. If Netflix just focused on stabilizing and returning steady profit, instead of infinite growth and inflating their stock price, they would be in a much better position than they are currently.

echelon2• 4 years ago

If they don't grow the pie now, their TAM will be locked forever.

Too little too late.

They got utterly routed by Disney.

thfuran• 4 years ago

If they don't grow the pie now, their TAM will be locked forever.

So what? Very nearly every successful business in the history of the world has had fewer customers than Netflix.

glenstein• 4 years ago

How much is Netflix investing into mobile games compared to original content programming?

gerdesj• 4 years ago

Why is this here?

It's not exactly news for nerds nor is it news for investors - there are plenty of other sources.

This article is an advert (try scrolling down) and wankery and very boring. "Why it matters" is pure comedy.

bombcar8• 4 years ago

Because FAANG is set to become G’DAAM.

MikusR• 4 years ago

https://www.theverge.com/2022/8/10/23300460/disney-plus-pric...

anideafornow• 4 years ago

Honestly, the spin that I typically see just feels steeped in bias: "Netflix has nothing _I_ want to watch, therefore it is catering to no one and doomed to failure".

I imagine Netflix has a really good grasp of the content landscape and is playing a bit of moneyball with that. Sure, reality TV is not everyone's cup of tea, but it may have a larger audience:budget ratio than other projects, thus being an important asset in a content portfolio. Let's not forget the Bridgerton's and shows of the like, whose appeal probably inversely correlate with that of Star Wars for a particular viewer, in aggregate.

I think an analogy to the gaming sphere is apt. You are not going to sell RTS's to people who play visual novels. And furthermore, in the MMO arena, there is also the dichotomy between those who play the game at a leisurely pace and those who consume end-game content as if it's their job. All of these different segments exist, yet how best to allocate resources among them is the true question. I do think disregarding a niche would be a mistake if one is truly chasing growth but it is also a balancing act. Essentially, Netflix is Steam, but forced to take on a much larger publisher role.

NaturalPhallacy• 4 years ago

Such a bummer because to my knowledge Netflix is the only streaming service that doesn't advertise crap that you have to sign up for other streaming services by including shows that you can't actually watch on it.

Every time I see a show on a streaming service that I can't actually click on and watch I return to the high seas and with Sonarr/emby.

siquick• 4 years ago

Disney+ in Australia definitely doesn’t do that.

stjohnswarts• 4 years ago

I knew this was inevitable, but I didn't expect it _this_ soon.

prirun• 4 years ago

"Disney's direct-to-consumer segment lost $887 million last quarter, the most since the quarter when it first launched Disney+ at the end of 2019."

https://www.axios.com/pro/media-deals/2022/08/10/disneys-str...

donkarma• 4 years ago

not paying for streaming services anymore. happy to pay for netflix but having to go all over the place is insane when i get much better service by fucking pirating

gentleman11• 4 years ago

Notably, this isn’t a case of Disney out competing Netflix. This is a case of a company that got rich off of good content decades ago simply buying almost every large video entertainment service around until it Defacto owned most of said entertainment world. Just give it a few years and maybe they’ll even buy pornhub

vivegi• 4 years ago

Netflix is overpriced relative to other streamers and they are going to have a problem with customer churn induced by streaming fatigue and price pressure with the streaming marketplace getting very crowded.

COVID theatrical closures made it look like they were fundamentally doing very well. If that factor is removed, the current strategic headwinds facing them would have been apparent much earlier.

Netflix could try pay-per-view instead of or in addition to the ads model. TVOD is a very small segment of total entertainment industry's streaming revenues and obscured largely by the success of SVOD driven by Netflix's trailblazing past and AVOD/FAST adoption by competition.

It may become the Blockbuster rental of the 21st century for the long-tail of videos, the business model they disrupted with their arrival.

Amazon Prime Videos is doing some of that (and so is YT and others).

But there is room for Netflix to innovate here to capture even the blockbusters (i.e., the fat part before the long tail).

(Theatrical | Direct to stream) -> NFLX Pay-per-view TVOD catalog -> NFLX SVOD catalog + NFLX AVOD catalog.

They could potentially sign up deals with theatres (and include technology) for special screenings reserved for the NFLX pay-per-view customers to watch the film on the large screen.

Some cannibalization of SVOD revenues will happen. But it would also force their competitors to play by the new rules instead of NFLX being totally reactive as they are finding themselves now.

shabin5785• 4 years ago

This should be powered by the IPL subscription in India for Disney. Thats huge..

But from this year, Disney lost the rights for ipl streaming. And numbers should come down..

kramerger• 4 years ago

Netflix: Star Wars is cool, but have you seen our new exclusives?

Chicago Librarians

Chicago Janitors

Chicago City Planers

I mean, I could go on...

Disney surpasses Netflix in global paid streaming subscribers

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