Last weekend, an estimated 100,000 people attended the D23 Expo at Anaheim Convention Center in Anaheim, California—a biannual fan gathering devoted to all things Marvel, Pixar, Star Wars, princesses, and other Disney franchises.
On Thursday, theme park creators showed off new ride plans and land expansions. On Saturday, movie studio executives unveiled trailers for upcoming films. Yet the biggest headlines focused on Friday’s presentation of Disney Plus, the entertainment streaming service set to launch on November 12.
Lucasfilm’s Kathleen Kennedy and director Jon Favreau offered clips from “The Mandalorian,” the first “Star Wars” live-action series. The eight-episode, $100 million serial follows a Mandalorian bounty hunter (think Boba Fett from the original trilogy). Season two is already in development. Favreau called it “an opportunity to tell a story that’s bigger than television.”
In the current streaming wars, Netflix and its 60 million monthly U.S. subscribers have indisputably bested rivals Hulu, CBS All Access, and Amazon Prime Video. Its streaming video on-demand (SVOD) model of ad-free programming available on any device has become the new standard for millennials wary of pricey cable contracts.
Yet the landscape is about to change. Four major SVOD services will launch over the next year including Apple TV Plus (soft launch this fall), HBO Max in spring 2020, and an unnamed NBC-Universal service in mid-2020. While about a dozen streaming platforms currently cater to family and faith-based consumers, the vision of Disney Plus as an all-ages streaming destination—and the resources behind it—seem unrivaled.
Half the Price of Netflix, Huh
Today’s TV market is saturated with options, with nearly 500 original shows produced annually worldwide. Yet at a preview event back in April, Disney wowed fans and investors with one key detail that came two hours into its streaming service rollout presentation.
Marvel Studios president Kevin Feige announced a slate of action-adventure series featuring the same actors as his hit Marvel movies. Pixar head Pete Docter revealed episodic shows linked to “Toy Story” and “Monsters, Inc.” A producer from National Geographic touted their 300-plus hours of documentary and exploration content coming to the platform. Early footage of “The Mandalorian” made its debut.
For reporters and analysts in the room, this was shaping up as a Netflix killer. Then came the kicker from Kevin Mayer, chairman of Disney’s direct-to-consumer division — right after dropping the release date of November 12. “We will be launching the service with the very attractive monthly price of $6.99,” said Mayer.
That’s about half the price of Netflix. One could hear an audible gasp from entertainment insiders.
Disney Bought Fox Partly for Streaming
Early surveys indicate 19 percent of Netflix subscribers are considering a switch, while Wall Street analysts are also bullish on Disney Plus. But some observers believe there is room in the marketplace for several successful streaming platforms.
“With Netflix and Disney Plus, I don’t see it as a binary comparison at all,” said eMarketer analyst Paul Verna on a recent podcast. “These are services that offer very different mixes of content, very different experiences, and targeted at different users.”
Disney execs have touted that the company will spend $1 billion on original Disney Plus content during its first year. This compares to Netflix funding original content at $15 billion annually and Amazon Prime Video at $7 billion this year, according to reports. Yet that undersells what Disney is able to stock on its streaming service due to a deep bench of film material.
This year alone, Walt Disney Studios has invested more than $15 billion in its wildly ambitious slate of theatrical films. “Avengers: Endgame” capped off the most successful series of superhero movies ever conceived. “Toy Story 4” rounded out the decades-long journey of Andy’s toys. In December, “Star Wars: The Rise of Skywalker” will conclude the nine-film Skywalker saga that George Lucas began in 1977. All these new films will be available on Disney Plus within the first year, as well as recent live-action reimaginings of “Aladdin,” “The Lion King,” and “Dumbo.”
Still, Disney CEO Bob Iger was unsure their film catalog held enough riches to sustain a streaming service to rival Netflix. The dealmaker who has acquired Pixar, The Muppets, Marvel, and Lucasfilm during his Disney tenure was thinking bigger. Iger set his sights on floundering studio 21st Century Fox with its decades of Hollywood hits.
On March 20, Disney’s years-long effort to acquire Fox film assets for $71 billion finally closed. As part of that deal and related agreements, Disney gained a majority stake in existing streaming service Hulu with 26 million paid monthly subscribers.
Disney Plus will thus become, in the words of company execs, a “permanent home” for its family-friendly content across all its various brands. Meanwhile, mature Fox fare such as “Alien,” “Super Troopers,” “Planet of the Apes,” and “Deadpool” will feature prominently on Hulu. A bundled deal priced at $12.99 includes access to Disney Plus, Hulu, and ESPN Plus.
Going Beyond the Vault
Disney Plus will not completely open the studio’s fabled vault, its greatest asset as nostalgia and established IP (intellectual property) drive most successful big-budget films today.
At launch, the family-focused streamer will reportedly have two dozen Disney Channel shows, several behind-the-scenes specials on the Mouse House creative process, and 30 seasons of “The Simpsons.” (Parental controls will be included.) Yet the slated 500 library film titles, including 100 recent flicks, barely scratches the surface of Disney and 20th Century Fox film and TV catalogs.
Only four Marvel films will be available at launch, with eight more scheduled for availability in its first year. Fewer than 20 of Disney’s 57 theatrical animated features will premiere. A promise of 7,500 series episodes sounds impressive, though it compares to 47,000 series episodes currently available on Netflix.
Despite their potential need to better mine the archives, Hollywood has learned not to bet against Disney. Of the mega-studio’s many film franchises, one has gone all-in for Disney Plus. On July 20 at San Diego Comic-Con, producer Kevin Feige rolled out their next two years of releases as “Phase Four” of the Marvel Cinematic Universe (MCU).
#Marvel has unveiled the fourth phase of its film rollout. New titles include a second "Doctor Strange," a "Black Widow" standalone and a number of Disney Plus shows https://t.co/uqKiHNhFYj pic.twitter.com/iakBA3lwWt
— Variety (@Variety) July 22, 2019
Feige’s MCU timeline featured five upcoming Disney Plus series, starting with “The Falcon and the Winter Solider” in fall 2020—right alongside its five theatrical films beginning with “Black Widow” next summer. The “Falcon” series stars Anthony Mackie, Sebastian Stan, and Daniel Brühl, reprising their roles last seen together in “Captain America: Civil War.”
Not only will these shows exist in the same Marvel universe as the films. Feige underscored that events in the shows will lead into and affect what happens on the big screen. On Friday at D23, Marvel’s mastermind added three more titles, bringing the total to eight original Marvel shows in development for Disney Plus.
Whether quality can be sustained remains to be seen. Peter Suderman, features editor at Reason magazine, discussed Disney’s plans last week on The Federalist Radio Hour.
“The expectation is that these products are going to be budgeted at $15 to $20 million dollars an hour,” said Suderman of Marvel’s Disney Plus shows. “Which means the special effects will not be as lavish… as even ‘Ant-Man,’ one of the smaller productions for Marvel. But they will be pretty significant. That’s as big or even bigger than the biggest episodes of ‘Game of Thrones.’”
Additional big-budget “Star Wars” shows will join “The Mandalorian” by year two, including a “Rogue One” spin-off already in production and a miniseries confirmed with Ewan McGregor reprising his role as Obi-Wan Kenobi. While that $6.99 monthly is sure to rise, Disney Plus currently looks like a bargain, especially for parents.
Streaming Competitors Gear Up for War
Netflix pioneered viewing habits that their content and technology partners will now exploit. Hype for Disney Plus is building, yet three other potential rivals have yet to provide many specifics.
While Apple is dropping $6 billion on original content for its service, little is known about Apple TV Plus except for a first trailer of “The Morning Show.” Rumored to be the most expensive TV show ever produced, it stars Jennifer Aniston, Steve Carell, and Reese Witherspoon in a fictional conceit with similarities to Aaron Sorkin’s “The Newsroom.”
Thus far, the other two services have been defined by the shows they’re taking from Netflix. Starting in 2021, “Friends” will land on HBO Max while “The Office” heads to the NBC-Universal platform. Meanwhile, CBS All Access has Patrick Stewart returning to his iconic role in “Star Trek: Picard” due in 2020. Amazon Prime Video continues to generate buzz with its $500 million prequel series to “The Lord of the Rings” in development.
With each streamer having its own exclusives, savvy consumers are likely to use the no-contract services to their advantage.
“Cancelling is no longer an absolute,” said analyst Peter Verna. “Somebody who decides to interrupt their Netflix service, they might do it for awhile. For six months, they may drop out and then come back in. It’s easier to do that with digital services than cable.”
Projects slated for the next two years on Netflix may prove enticing to families including an adaptation of “The Chronicles of Narnia,” an original “Jurassic World” animated series, and ongoing seasons of “The Crown.” Yet financial analysts doubt Netflix will retain its lead with U.S. consumers, even if its global dominance in 190 nations currently remains unrivaled.
“Netflix should be really scared,” said Suderman. “If you start with, Disney owns the box office. Then you say, Disney Plus is launching with all these IPs that everyone already loves. And they’re going to spend a ton of money on [original content]. It looks to me like Disney is just going to clean up with this service and have a huge launch.”