Jon Crunch: Will Disney+ Be a Worthy Streaming Service?

I’ve been waiting for the right time to talk about Disney’s recently announced streaming service, Disney+.

Disney unveiled its “director-to-consumer” strategy when Bridget and I were at Walt Disney World in Florida (oddly enough).

If you want to know how “meta” the experience was, I listened to this CNBC interview where CEO Bob Iger discussed Disney+ as I took an hour-long walk around the Art of Animation Resort we were staying at:

Iger told CNBC “you have to look at not only the way the world is going, but we had to assess what the biggest opportunity was for the company to grow over the long term. And clearly, consumers are enjoying a kind of a different form of entertainment in the home — one that is over-the-top, and not necessarily connected to a traditional satellite or cable distributor, or distribution model.”

Part of the reason I started this blog in 2016 was to talk about cord cutting and various streaming services that would help you ditch traditional cable and satellite TV subscriptions.

I’ve done some posts on the topic, but not nearly enough.

I’d been looking forward to seeing what Disney would unveil with its so-called “Netflix competitor.” The Mouse finally unveiled details about their streaming service on April 11 in its “Investor Day 2019” webcast.

Here are some basics about the Disney+ streaming service...

Disney+ will launch on Nov. 12, 2019.
The price will be $6.99/month, or $69.99 ($5.83/month) if you pay for a year in advance.
The service will be ad-free and be rolled out globally.
It will support 4K HDR playback.
Allows subscribers to download content to view offline (as long as they maintain a subscription).

BAMTech is the company that powers Disney Streaming Services (they are also behind the MLB.tv streaming service). Disney owns a controlling interest in the company.

The service is segmented into different sections of interest: Disney, Pixar, Marvel, Star Wars, and National Geographic.

Disney+ will include original films and TV shows as well as catalog content from the "vault." All of it will be downloadable (something other streaming services only allow with select programming).

In addition, Disney’s recent acquisition of 21st Century Fox was designed to enhance and accelerate the company’s direct-to-consumer business (translation: every episode of “The Simpsons” will be available to stream, select Fox movies like “Avatar” will be included, and documentary-type content from “National Geographic” will round things out).

Kevin Mayer — who is the Direct-to-Consumer & International Chairman at The Walt Disney Company — outlined the company’s strategy during the April 11 presentation.

Mayer talked about how Disney’s overall content portfolio attracts “a four-quadrant audience: adults and children, males and females.”

Disney is the only studio to top $7 billion in box office receipts for a single year (with consumers buying 900 million tickets to Disney movies in 2018). They have tremendous amount of brand affinity around those properties.

The same creative teams behind the Marvel Cinematic Universe and the recent “Star Wars” films will be creating content for Disney+.

They demo’d the app during the presentation in a fairly general sense to give an idea of how content would be organized and what will be included with a subscription.

When Disney+ debuts on Nov. 12, it will feature Star Wars live-action series “The Mandalorian” (set after the events of “Return of the Jedi”), a new live-action “Lady and the Tramp” movie, “High School Musical” The Series, and box-office blockbuster “Captain Marvel.”

Within the first year, the service will add the original movie “Noelle” (starring Anna Kendrick as Santa’s daughter), the Marvel series “Falcon and Winter Soldier,” Pixar originals, new episodes of “Star Wars: The Clone Wars,” “Phineas and Ferb the Movie,” and “The Imagineering Story” (a documentary takes you into the world of Disney’s theme parks).

In addition to the “new” offerings, Disney+ will feature 13 signature films on Nov. 12 — including “Snow White and the Seven Dwarfs,” “Pinnochio,” “Cinderella,” “The Jungle Book,” The Little Mermaid,” and “The Lion King.”

The vast majority of Disney’s “recent hit films” will also be available on Day 1. This includes films like “Moana,” “Big Hero 6,” and “Frozen.”

Eighteen of Pixar’s theatrical films will be available on Day 1 (three other films will come to the service within the first year) along with Pixar’s entire library of short films. The original Pixar series “Forky Asks a Question” will debut with the streaming service.

Many of the movies from the Marvel Cinematic Universe will be available on Nov. 12 (with more being added during the first year). In addition to the new “Falcon and Winter Soldier” series, the studio is also developing a series called “WandaVision” (focusing on the MCU characters played by Elizabeth Olsen and Paul Bettany), and a series focused on Tom Hiddleston’s Loki character.

Lucasfilm President Kathleen Kennedy outlined what “Star Wars” content would be offered on Disney+. As mentioned, “The Mandalorian” will debut with the service on Nov. 12. Lucasfilm is also working on a series focusing on the Cassian Andor character (played by Diego Luna) from “Rogue One: A Star Wars Story.”

Kennedy also said they are developing “several more live-action series.” Some have speculated a series starring Ewan McGregor as Obi-Wan Kenobi could be in the works.

The library of back “Star Wars” content will be available, but it was unclear what all might be included (and when). They did mention the first two “Star Wars” trilogies (plus “The Force Awakens” and “Rogue One”) will be available on Day 1.

I would assume animated "Star Wars" series like "Resistance" and "Rebels" will be available.

In addition to “Star Wars” properties, Ron Howard has suggested a series based on the 1988 movie “Willow” could be in the works for Disney+. YouTuber John Campea discussed this possibility on a recent episode of his show:

In the first year of Disney+, the service will feature “more than 25 original episodic series and more than 10 exclusive movies, documentaries, and specials.”

Disney+ will eventually become the exclusive streaming home for all content from the company’s various brands.

The service will debut with an extensive offering from Disney’s catalog including films in the “vault” (which haven’t been seen in a number of years).

In the first year, Disney+ will have more than 7,500 episodes of television, over 400 library titles, and over 100 recent theatrical film releases (like “Captain Marvel”).

By the fifth year, they expect to have 50 original series on an annual basis. At that juncture, there will be 10,000 TV episodes and well north of 120 recent films available to subscribers. On top of that, they’ll include all 500 Disney library titles.

So, what do I think of Disney’s direct-to-consumer streaming strategy?

I think the price point — $6.99 a month or $69.99 if you pay for a year in advance — is a non-intimidating amount to entice a fair number of subscribers during the first 12 months.

Whether or not consumers stick with the streaming service for the long haul will depend on a variety of factors.

If the original series and movies are compelling, it will go a long way to making the service a desirable commodity. I also think the popularity of the service will depend on Disney’s theatrical offerings over the course of the next five years.

It was reported online today that “Star Wars: The Rise of Skywalker” (which is being released on Dec. 20) will be the last “Star Wars” movie until Dec. 16, 2022 (with sequels to follow in 2024 and 2026).

If the news is true, fans of the tentpole property will have to wait three years to see more “Star Wars” at their local multiplex.

It's possible this is all part of Disney’s strategy to “prime the pump” for the Disney+ subscription service.

If Disney+ is the only place where you can see fresh “Star Wars” content following the release of Episode IX (until 2022), then that could prove an enticing hook for fans of “a galaxy far, far away...”

Disney is at something of a crossroads right now. They are in the midst of the tremendous success of “Avengers: Endgame” at the box office.

Because “Endgame” is the culmination of 11 years of Marvel Cinematic Universe films, it likely means the mammoth franchise is moving in a different direction — one that might not see story arcs develop over 20+ films in the future.

Even if future films follow a similar pattern, Disney suggested the Marvel content offered on Disney+ will intertwine with the MCU in a meaningful manner.

Disney could narrow windows between theatrical release dates and those MCU films debuting on Disney+.

In the company’s presentation, they suggested theatrical content won’t debut on the service until “after” theatrical runs — and traditional home video releases.

But as the years progress, you wonder if that strategy will evolve.

There are those who speculate “physical media” in home video is dying (a topic I’ll address in an upcoming blog post).

We all know Netflix is spending insane amounts of money to produce content for its streaming service (making more TV shows and movies annually than a number of established studios).

As the price of consumer electronics continues to drop — coupled with the introduction of advanced technology like 8K televisions — you wonder if Disney+ will become the centerpiece of the Mouse’s content strategy.

It’s all part of the massive upheaval we’ve seen the past decade. Technology companies find themselves becoming content companies. Entertainment companies find themselves becoming technology companies. The lines are starting to blur between the two.

I don’t know if Disney+ will be a full-bore competitor to Netflix out of the gate.

That said, now that Disney holds a controlling interest in Hulu, the combination could prove to be a solid one-two punch (Iger has suggested they’ll offer bundles at some point).

More than anything, it brings into question the future of entertainment.

Disney is the glue holding the theatrical box office together. It’s hard to imagine the movie-going experience the past decade without Marvel, Pixar, and Star Wars.

Competitors are struggling to develop tentpole properties as compelling as Disney. As a result, Disney will continue to enhance its prowess. With the purchase of 21st Century Fox, the Mouse has more control over the theatrical schedule than ever before — clearing the lane for domination the next decade.

If Disney decides to “flip a switch” with Disney+, it could also become the dominant player in the streaming market.

Can you imagine a world where Disney puts a movie like “Avengers: Endgame” on its streaming service 90 days after theatrical release?

What if Disney decides to stop making DVDs/Blu-Rays entirely, and instead makes Disney+ the “only” way you can watch its movies in your home?

Moves like that would have long-term ramifications.

In the near term, the key to hooking subscribers will be the quality of original shows like “The Mandalorian” (with Jon Favreau and Dave Filoni behind it, I have high hopes).