Disney is tired of suffering from cord-cutting pulling subscribers away from ESPN, announcing plans to launch its own direct to consumer entertainment streaming service – and removing its films from would-be rival Netflix – in its third-quarter earnings release. Disney will pay $1.52 billion to acquire an additional 42% of BamTech, the streaming video technology business.
Disney acquired a 33% stake in BamTech last year for $1 billion. The Disney streaming service will be the exclusive home for subscription on demand viewing of the company’s recent hits, including its live action remakes and Pixar animated features. When the Disney streaming service launches, these movies and shows will be removed from Netflix.
The Disney movies released before then will be able to remain on Netflix. When this announcement was made, Netflix shares went downward. Additionally, people are questioning whether other companies will do the same and follow suit. When Disney launches its streaming service, the initial subscription service will be built around ESPN’s sports programming.
The new streaming service with ESPN will cover about 10,000 live regional, national and international events, including Grand Slam tennis and events for Major League Baseball, the NHL, Major League Soccer and college sports.To keep up with these changes, Netflix has reported that it will have 75 original children’s programs by the end of next year. Netflix expects to have 64 million subscribers in the United States and 158 million worldwide in 2019, when Disney plans on introducing its new streaming service.