Netflix Raises Prices for Subscribers

The war between Netflix and Disney for subscribers is becoming more and more competitive.

Disney Co. is an enormous company. What once was just an amusement park with a fun little mouse has grown into one of the largest media and entertainment companies in the world. 

It is now just a little bit bigger with its billion-dollar streaming service platform known as Disney+. Coming to the general public on Nov. 12, Disney+ will be making itself a major competitor to other major streaming platforms, specifically in its ever-festering feud with Netflix. 

Netflix Inc. who was once the front-runner in streaming entertainment, is at risk of losing 14% of subscribers to viewers who will be transitioning to Disney+ for their entertainment needs according to Streaming Observer and Mindnet Analytics. While this may seem like a blip in the number of subscribers that Netflix has, 14% of Netflix subscribers equates to 8.7 million people, which for reference is a little less than the population of Serbia (8.8 million citizens, according to the CIA World Factbook). With an estimated loss of $117 million in revenue for Netflix, Disney Co. is looking at a huge win over Netflix. 

Why this is happening ­—the run down 

As of 2017, Disney became tired with the amount of money it was losing to Netflix. Well losing might not be the correct word, it’s more like became jealous of the lack of money that it was not making with Netflix that it decided to pull out of the streaming giant and build its own. 

But it wasn’t always this way for Disney. In 2012, Disney struck a deal to sell its movies to Netflix for $300 million a year, which benefited Netflix as in 2015 the ad-free streaming platform was attracting millions of customers to the platform while simultaneously causing a great loss in Disney’s cable channel viewership.

In August 2017, Disney Co. began to look at Netflix as more of a foe than a friend when it announced the company would be pulling its animated titles from Netflix to start its own streaming service. 

Disney projected a winning battle against Netflix but with a cost. Disney’s new streaming platform will cost the company $3.9 billion in lost revenue in the 2019 fiscal year, as estimated by Vox analyst Michael Nathanson. Disney hopes to sign up 60 million to 90 million subscribers by the end of it’s 2024 fiscal year according to AB Bernstein analyst Todd Juenger. Disney can afford this loss as the corporate giant’s recent acquiring of Rupert Murdoch’s 21st Century Fox shows. 

How it’ll affect consumers 

With all these services coming for Netflix there will be an influx in content to pay for. 

Whoever is paying for your streaming service will begin to pay major bucks to get a variety of entertainment. 

Netflix will cost $8.99 to $15.99 a month, $12.99 a month for access to Amazon Prime Video (or a student Amazon Prime account for $59 a year), $5.99 to $11.99 a month for Hulu (depending on your ad plan), $7 a month for Disney+, CBS All Access being $6,  and potentially more than $14.99 a month for the new WarnerMedia service, HBO Max. There will also be NBCU’s streaming that will be free for those with cable, as well as Viacom’s BET service that has yet to release a price. 

Disney will be taking a cable approach to its streaming service with a $12.99 bundle which will include subsidiaries like Hulu and ESPN+, which has been projected to have 12 million subscribers for ESPN+ and 60 million Hulu subscribers. 

Each service is relying on nostalgia and fan-serving media to draw viewers to its platforms.

As of 2018, “The Office” with 52 billion minutes of watch time and “Friends” with 32 billion minutes are two of Netflix’s most watched shows. It will be losing these shows and other licensed content to streaming services from NBCUniversal and WarnerMedia.

In 2018 Netflix paid an estimated $100 million to keep “Friends” on its platform for another year.

 Viewers ages 18 to 34 spend 75% of their time watching non-original Netflix programming and would cancel Netflix if "The Office,” “Friends,” Marvel movies and Disney content were all removed from the service, according to Nielsen data cited by Business Insider. 

Disney+ will offer all Disney films including Disney+ originals like Marvel and Star Wars TV shows, including shows like "The Falcon" and "The Winter Soldier" starting Anthony Mackie and Sebastian Stan and "High School Musical: The Musical: The Series." 

 With all this new media, what will you (or your parents) be paying for? 

Mila Yoch is a news editor.

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