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Future of TV Media Disney

Disney+ eyes next phase to grow 28.6 million subscribers through Europe and India

By Andrew Blustein, Reporter

February 4, 2020 | 4 min read

Already seeing success for its four-month-old streaming service, Disney expects the next area of growth for Disney+ to come from Western Europe and India.

The Mandalorian is exclusively available on Disney+

The Mandalorian is exclusively available on Disney+

Disney+ tallied 26.5 million subscribers by the end of the first quarter, which ended 28 December. Bob Iger, Disney chief executive officer, said that number is now at 28.6 million as of yesterday (3 February).

“We expect subscriber growth to come primarily outside of the US in the near-term,” Iger said on today’s (4 February) earnings call. Iger added that further domestic growth will come later this year when more original shows are added to the service.

Disney+ will launch in the UK, Ireland, France, Germany, Spain, Switzerland and Austria on 24 March. Five days later, Disney+ will launch in India through a partnership with Disney-owned streaming platform Hotstar.

Without revealing pricing, the India product will have two tiers: a premium option with originals and full library, and a basic option of just library content.

Disney+ will make its way to Belgium, Portugal and the Nordic region in the summer, and launch in Latin America sometime in 2021.

Iger said the priority is to first grow the international footprint of Disney+, and then begin rolling Hulu out internationally in 2021. Disney took full control of Hulu last May.

While Disney didn’t break out marketing spend for Disney+, Iger said moving into international markets will require a strong awareness push.

“Interest in streaming in general isn’t as high [internationally] as it has been in the US. It will be more of a marketing effort, and more of a challenge to launch in those markets,” said Iger.

Disney+ is currently available in the US, Canada, the Netherlands, Australia, and New Zealand. Stateside, consumers can sign-up directly through Disney, through a distributor such as Roku or Apple TV, or get if for free as part of their Verizon wireless plan.

Iger said roughly half of Disney+ subscribers come directly through Disney, meaning the company keeps all subscription revenues. Roughly 20% receive Disney+ through Verizon, and the rest come through Disney’s various distribution partners.

As of 3 February, Hulu and ESPN+, Disney’s other streaming properties, had 30.7 million and 7.6 million subscribers, respectively. Both numbers represent significant year-over-year increases.

Disney’s direct-to-consumer and international sector, which includes its streaming business, reported a quarterly revenue loss of $4bn due to the launch of Disney+, the consolidation of Hulu and a higher loss at ESPN+.

Higher losses at ESPN+ were attributed to increased marketing spend and programming spend, mostly around UFC. Iger said the recent fight between Conor McGregor and Donald Cerrone brought in half a million subscribers to ESPN+.

ESPN is also seeing advertising losses in its cable business. Christine McCarthy, Disney’s chief financial officer, said ad revenue for the network decreased by 4.5% during the quarter thanks partly to lower viewership of its NBA and college football games.

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