Disney plans int’l streaming service

Disney’s library includes movie classics like Toy Story

The Walt Disney Company will pull its movies from Netflix in the US in 2019 and launch a rival Disney-branded international streaming service.

Disney said it would end its distribution agreement with Netflix for subscription streaming of new releases, beginning with the 2019 calendar year theatrical slate.

Its direct-to-consumer offer will join the Mouse House’s ESPN-branded multi-sport video streaming service, which is set to launch in early 2018. Price points for the services have yet to be revealed.

Ahead of the launch, initially in the US, Disney has taken majority ownership of digital media firm BAMTech for US$1.58bn, increasing its stake in the company to 75%.

Disney took a 33% stake in BAMTech in August last year and the agreement included an option to acquire a majority stake over several years. Yesterday’s announcement marks an acceleration of that timetable for controlling ownership, Disney said.

The new Disney-branded service will become the exclusive SVoD home in the US for the media giant’s live-action and animated movies, beginning with Toy Story 4, the sequel to Frozen and the live-action version of The Lion King.

Bob Iger

Netflix’s exclusive agreement for Disney’s movie titles in the US began in September last year.

Disney also said it would make a “significant” investment in an annual slate of original movies, TV shows, shortform content and other Disney-branded exclusives for the service.

It will also feature a “vast” collection of library content, including Disney and Pixar movies and Disney Channel, Disney Junior and Disney XD television programming.

Bob Iger, chairman and CEO at The Walt Disney Company, said: “This acquisition and the launch of our direct-to-consumer services mark an entirely new growth strategy for the company, one that takes advantage of the incredible opportunity that changing technology provides us to leverage the strength of our great brands.”

Iger also expanded on the plans for the streaming service outside of the US.

“We’ll also rollout the service in multiple markets outside the US, but it will vary from market to market based on existing distribution agreements and different market dynamics. But I think you have to think about a Disney branded direct-to-consumer subscription service as a global product, even though we are being more specific today about launching a domestic product in the latter part of 2019.”

Disney has already experimented with direct-to-consumer offers outside of the US with DisneyLife in the UK, which costs £4.99 (US$6.49) per month. Expansion in other parts of EMEA and Australia has been mooted but has not yet materialised.

DisneyLife offers around 400 classic and newer Disney movies alongside more than 4,000 episodes of Disney TV shows, plus live streaming of Disney Channel, Disney XD and Disney Junior.