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Disney looks strong ahead of its streaming service, Disney+

Disney looks strong ahead of its streaming service, Disney+

CNN News Source
, Disney looks strong ahead of its streaming service, Disney+

Disney will join the streaming wars from a position of strength. Netflix, beware.

The entertainment giant — buoyed by the release of “The Lion King” and “Toy Story 4,” as well as its theme parks — beat Wall Street’s expectations when it reported earnings after the bell on Thursday. Shares are up 5% in premarket trading.

The company’s profits slumped as it spent big ahead of the launch of its Disney+ streaming service in the United States, Canada and the Netherlands next week. But investors aren’t overly concerned. They’re already looking ahead.

“With the launch of Disney+, we’re making a huge statement about the future of media and entertainment and our continued ability to thrive in this new era,” CEO Bob Iger told analysts.

Disney has built up a massive content library to support its streaming strategy. Marvel, Mickey Mouse, Pixar, Star Wars and 21st Century Fox titles like “The Simpsons” are now all part of the Disney family.

Adding to its muscle: Iger announced Thursday that Disney and Amazon reached a deal to bring Disney+ to Amazon’s Fire TV devices. He said the company also has distribution deals with Apple, Samsung, LG, Google and Microsoft.

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The competition is fierce. Apple launched its Apple TV+ service last week. CNN parent AT&T and Comcast will soon follow suit.

Disney is poised to dominate among new entrants. In a recent survey conducted by Bank of America Merrill Lynch, 17% of respondents said they were most likely to subscribe to Disney+ when it went live, a much higher percentage than for Apple TV+ and AT&T’s HBO Max.

Netflix is in a strong position, too. Per Bank of America, Netflix could lose some customers as a result of the Disney launch, but the churn will be modest. Only 5% of US consumer surveyed said they were likely to cancel Netflix to switch to Disney+, and that probably includes some subscribers who were likely to cancel anyway. Disney will need to play the long game.

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