Netflix has been the Internet's de facto movie and television streaming service for what feels like forever now, crossing the 100 million global subscriber mark earlier this year. However, the media company was dealt an unexpected blow recently, when Disney CEO Bob Iger announced that the Mouse would be pulling its Star Wars and Marvel related content from the platform in favor of starting its own competing streaming service, which is set to debut in 2019.
The move to its own direct-to-consumer option has been in Disney's plans for a while, with the move being officially announced last month, as per Variety. However, with speculation that both they and Netflix could work out a licensing deal, it now looks like all Disney-owned content will be staying inside the Magic Kingdom's vaults sooner rather than later. "We’ve now decided we will put the Marvel and Star Wars movies on this app as well,” Iger said during a Q&A at Bank of America Merrill Lynch Media’s communications and entertainment conference in Beverly Hills. It's a move that didn't go unanticipated by Netflix either, who has been ramping its production of original content to reduce its dependency on licensing from other rights holders, including Disney.
Shareholders didn't react positively to the news, however. Disney's stock value fell 4% on Friday after the news broke and saw minimal upward gains by the time the closing bell sounded. According to Business Insider, that sort of negativity might be coming from the angle that sees Disney needing 32 million subscribers at nine dollars per month just to break even, never mind begin to challenge Netflix. UBS analysis shows that, contrary to this perceived state of dissatisfaction, there is definitely room for optimism. "While [32 million subscribers] is not a stretch at all given our bullish expectations for the growth in the SVOD [streaming video] marketplace globally, it certainly creates greater EPS [earnings] uncertainty for the next several years during a period where investors are already nervous about secular trends for ESPN." While Disney's streaming service numbers are sure to dwarf those of HBO, CBS and Showtime, they will still pale in comparison to their former allies in the streaming market.