The streaming wars appear to be underway as Walt Disney Co. (NYSE:DIS) announced that it is pricing a new bundle of streaming services at just $12.99 U.S. a month, a move industry analysts see as a direct challenge to Netflix.
The Disney streaming package includes family programming, live sports and a library of popular television shows. On Tuesday, Disney announced the combined pricing for Disney+, ESPN+ and Hulu on a conference call with investors. It will debut as part of the November launch of the Disney+ streaming service.
Disney is matching Netflix’s monthly charge for its standard streaming plan and marketing the service $3 U.S. below its rival’s premium version, which lets subscribers and their family members watch on as many as four devices at once. But two of the Disney services, ESPN+ and Hulu, carry advertising, while Netflix is completely commercial-free.
Disney’s film and TV show library consists of Marvel, Pixar and Star Wars brands, as well as classic Disney live action and animated movies and programs. Disney is counting on its content and pricing to attract subscribers this fall.
Disney’s aggressive pricing could also create headaches for HBO Max, a streaming service from AT&T (NYSE:T) that’s scheduled to launch in early 2020. That package also will offer family programming and original shows. The cost for HBO Max hasn’t been announced yet. But HBO alone costs $14.99 U.S. a month, suggesting that it will be difficult to compete with Disney on price.
Disney is betting online services will counter the loss of conventional TV viewers for flagship channels like ESPN, ABC and the Disney Channel. Earlier this year, the company spent $71 billion U.S. acquiring the movie and TV assets of Fox to bolster its content and future offerings.
