At a critical time for the entertainment industry when media companies are merging (AT&T and Time Warner, Disney and Fox, Comcast and NBC Universal) and the streaming media business is growing at a dizzying pace, Disney recently drew a line in the sand with plans to end its distribution deal with Netflix and jump into the streaming fray with Disney+.
The exclusive direct-to-consumer streaming service will go head-to-head with Netflix and other tech and media giants already dominating the marketplace and will feature Disney’s vault of TV, movie, and video content that includes Marvel, Pixar, National Geographic, and Lucasfilm. In addition, though its acquisition of Fox, Disney will own a majority stake in Hulu, giving it an added punch against established streaming competitors.
In an interview with CNBC, industry veteran and Liberty Media Chairman John Malone characterized Disney’s move as stepping into a “food fight” with the streaming giants. And while he felt that Disney has the best brand in streaming, it was entering the marketplace at a subscriber disadvantage.
“They have great brand, there’s no question, and they really know the entertainment business,” Malone told CNBC. “What they don’t have is a massive number of global credit cards. They don’t have massive direct consumer relationships at this point, and those are not easy to come by.”
Malone speculates that to compete with Amazon’s built-in subscriber base through its retail presence and Amazon Prime, and Apple’s massive consumer reach as a hardware and software giant, Disney will have to find creative ways to parlay its dedicated brand followers and theme park guests into Disney+ streaming subscribers.
In case your head is spinning, here is a great media landscape chart from Recode organized by distributors, content companies, and internet video companies to help keep it all straight…for the moment.
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