Walt Disney has priced its highly anticipated streaming video service below Netflix in an aggressive move to challenge the dominant streaming service and entice families to buy yet another monthly subscription.
Disney said on Thursday its new family-friendly streaming service will cost $7 monthly or $70 annually with a slate of new and classic TV shows and movies from some of the world’s most popular entertainment franchises in a bid to challenge the digital dominance of Netflix.
The ad-free monthly subscription called Disney+ is set to launch on November 12th and in every major global market over time, the company said.
In addition to Disney films and TV shows, it will feature programming from the Marvel superhero universe, the Star Wars galaxy, Toy Story creator Pixar animation the National Geographic channel and the entire library of the Simpsons.
“What we are putting forward is an aggressive strategy,” Disney chief executive Bob Iger told analysts at the presentation. “We’ve got to be very serious and all in on it.”
The company set a target of luring between 60 million to 90 million subscribers and achieving profitability in fiscal year 2024. It plans to plough a little over $1 billion in cash to finance original programming in fiscal 2020 and about $2 billion by 2024.
The cost of the service was lower than the $7.50 per month that Wall Street analysts expected on average, according to a Reuters poll, and could likely be seen as a stronger bid to appeal to more customers.
Patrice Cucinello, a director at Fitch Ratings, said Disney had priced the new service “very affordably”.
“Disney is approaching streaming offerings, particularly Disney+, with guns blazing, looking to take share and quickly ramp subscriber growth,” Cucinello said.
To get it in front of more people, Disney said it has struck deals with Roku and Sony to distribute Disney+ on streaming devices and console gaming systems and expects it to be widely available on smart televisions, tablets, and other outlets by launch.
