The US entertainment giant blew past expectations for new
subscribers to its flagship streaming service Disney+, whose big studio muscle
helped it reach 129.8 million subscribers worldwide, some five million more
than analysts had predicted.
Netflix ended the year with 221.8 million subscribers, a
massive number, but it announced slowing growth.
"We certainly understand the pie is big enough for both
companies to succeed," CFRA analyst Tuna Amobi said of the streaming
rivals.
"What is undeniable is the competition has gotten more
intense."
Netflix and Disney+ both saw numbers boom under the lockdown
lifestyles brought about by the pandemic.
Disney, the Hollywood entertainment behemoth that turns 100
next year, saw streaming subscriptions pick up pace as pandemic restrictions
ease, while Netflix saw them slow.
"Our unmatched collection of assets and platforms,
creative capabilities, and unique place in the culture give me great confidence
we will continue to define entertainment for the next 100 years," Walt Disney
Company CEO Bob Chapek said in an earnings statement.
The company, with an empire that stretches from movies to
theme parks and also includes streamers Hulu and ESPN+, reported profit that
topped forecasts on revenue which surged to $21.8 billion in the final three
months of 2021.
Disney has a huge pipeline of content and big name
franchises such as Marvel and Star Wars, while Netflix has found success
investing in original content from Hollywood and beyond.
"These results speak volumes for Disney's storied
brands and its ability to rise above the competition in an increasingly crowded
digital media market," wrote Insider Intelligence analyst Paul Verna.
Originality
Like the Prime video streaming service fielded by Amazon,
Disney is copying Netflix's tactic of investing in local content that appeals
to the language, culture, and tastes in respective international markets.
"We have created a new organization in the company to
shepherd development of that content" and hope to get "some global
hits" out of locally produced content, Disney's Chapek said.
Netflix has made that approach work, backing original
blockbusters such as "Squid Game" from South Korea and France's
Lupin.
Disney said it has some 340 programmes in the works outside
the United States that are expected to be delivered in the next 18 to 24
months.
Shows or films made in various countries by local talent has
been a strength for Netflix, which is relying on international markets for
growth now that it is firmly entrenched in US households.
Disney, based in Southern California, is present in only
about 60 countries, against more than 190 for Netflix, but aims to add 100 more
by 2023.
Disney+ subscriptions could further close the gap with
Netflix once it enters all those countries, according to Amobi.
In India alone, Netflix, Disney, and Amazon are rivals in a
market which last year was reported to have some 60 million to 70 million
paying subscribers.
International growth, though, comes with the caveat that
subscription prices tend to be much lower than what is charged in the United
States.
Netflix did not hesitate to lower its prices in India at the
end of last year, to remain competitive.
Disney relies on subsidiary Hotstar in India, where revenue
per subscriber is lower than in other countries where its streaming service is
established.
With just shy of 74 million total subscribers, more than
half of them in the United States, HBO and its HBO Max service lack the
firepower of Amazon, Disney, and Netflix.
A planned marriage with Discovery+, expected to be finalised
by mid-year, could ignite momentum for HBO.
NBC-owned Peacock along with Paramount+ and even Apple TV
are, for the time being, distant runners-up to the top contenders.
"Trends still favor streaming platforms," analyst
Amobi told AFP.
"The pandemic accelerated those tailwinds. The question
is, coming out of the pandemic how many of those winds could reverse?"
Digital TV Research estimates that online video services
will have 1.7 billion subscribers worldwide by 2026.
"There's more competition than there has ever
been," Netflix chief executive Reed Hastings said recently.
Overall, he added, there is confidence that traditional
television withers away in the next 10 to 20 years, with streaming becoming the
new norm.
0 comments:
Post a Comment