Disney pulling all content from Netflix, launching own streaming service

[lockedoutlogic]

Everything is going to be a mess for a while. Despite the news headlines, Disney can't pull everything from Netflix.

What is really happening is Netflix controls the pay-cable rights for all Disney films release theatrically from 2016 through 2018. Disney will now keep those pay-cable rights to Disney-Pixar films release theatrically from 2019 going forward (but not necessarily Marvel Studios or Lucasfilm movies). Plus, of course, Disney's controls their back catalog. What is going to happen is in 2019, Starz will control pay-cable rights for Disney films released theatrically from 2012-2015, Netflix will control the pay cable rights for 2016-2018 and Disney from 2019 forward. At lease for a few overlapping years while those pay-rights expire (the Starz ones may expire by 2019)

As to success? I'm not sure. The reason for success for Netflix and Hulu is they offer a one-stop shop, lots of content from lots of providers for one price. With every studio/network looking to set up their own streaming service, there will be a saturation/breaking point. I know I won't pay $10 for any one studio/network, I'm close to cnacelling Netflix now because they offer less and less.

Fantastic

 

[lockedoutlogic]

I honestly don't get why they don't focus on being the content creators and let someone else handle all the distribution...They could create and/or lease different content to all the different providers and never lose if one of them goes belly up...they could be what the NFL is to sports programming - they'd be the same of entertainment programming...

If I had to guess...it's because if you don't control distribution...you are slaves to Comcast, Verizon and AT&T...and that is what the media companies hate.

 

[tjkraz]

So If they were to try and lift the local restrictions - essentially cutting out cable and the networks - the big boys would go defcon 1.

Agree..the blackout restrictions aren't going anywhere. Those Regional Sports Networks like Fox and Comcast are paying hundreds of millions for broadcast rights to the local team. They can't afford to see their product bundled with existing league-wide streaming packages from MLB, NBA, etc.

However, there may be nothing to preclude the RSNs from offering their own streaming service.

That appears to be the direction we're headed. For a while, networks seemed reluctant to start their own a la carte services. Not sure if that had more to do with operational issues or if they were afraid of blowback from cable/satellite operators. But now that the barn door is open, the horses ain't coming back. In the last couple of days, both Disney and FX have announced stand-alone streaming products. AMC is testing. Discovery bought Scrips, ostensibly to add additional networks for a non-sports streaming package of their own design.

Services like Netflix and Amazon Prime will start to lose content at an accelerated rate. HBO has already stated that it's shows will disappear from Prime next year. Disney is pulling out of Netflix. FX programming will likely vanish from both over time as they want that back catalog exclusive to their $6 per month service. CBS may do the same to help promote it All Access service.

And that's just the beginning.

If the networks have their way, most consumers will end up paying $6 - $8 - $15 apiece for a handful of channels/services they consider to be essential. We all balked at the idea of paying $100 per month for 200 cable channels. But if the industry continues to shift in this direction, even moderate content consumers may end up paying $75 per month for 10 networks.

Stuck somewhere in the middle are streaming services like Sling, Playstation Vue and Directv Now. Right now, those are affordable options for cord cutters but hard telling how long their contracts will allow that to be the case. Sling's "Orange" package includes ESPN, ESPN2 and two dozen other networks for just $20 per month. Only the ignorant would instead pay $15-20 to Disney for a stand-alone ESPN plan. DirecTV Now offers the ESPN networks and 60 others for just $35...or a discounted rate of just $10 per month to AT&T customers with unlimited cell phone plans.

 

[lockedoutlogic]

Agree..the blackout restrictions aren't going anywhere. Those Regional Sports Networks like Fox and Comcast are paying hundreds of millions for broadcast rights to the local team. They can't afford to see their product bundled with existing league-wide streaming packages from MLB, NBA, etc.

However, there may be nothing to preclude the RSNs from offering their own streaming service.

That appears to be the direction we're headed. For a while, networks seemed reluctant to start their own a la carte services. Not sure if that had more to do with operational issues or if they were afraid of blowback from cable/satellite operators. But now that the barn door is open, the horses ain't coming back. In the last couple of days, both Disney and FX have announced stand-alone streaming products. AMC is testing. Discovery bought Scrips, ostensibly to add additional networks for a non-sports streaming package of their own design.

Services like Netflix and Amazon Prime will start to lose content at an accelerated rate. HBO has already stated that it's shows will disappear from Prime next year. Disney is pulling out of Netflix. FX programming will likely vanish from both over time as they want that back catalog exclusive to their $6 per month service. CBS may do the same to help promote it All Access service.

And that's just the beginning.

If the networks have their way, most consumers will end up paying $6 - $8 - $15 apiece for a handful of channels/services they consider to be essential. We all balked at the idea of paying $100 per month for 200 cable channels. But if the industry continues to shift in this direction, even moderate content consumers may end up paying $75 per month for 10 networks.

Stuck somewhere in the middle are streaming services like Sling, Playstation Vue and Directv Now. Right now, those are affordable options for cord cutters but hard telling how long their contracts will allow that to be the case. Sling's "Orange" package includes ESPN, ESPN2 and two dozen other networks for just $20 per month. Only the ignorant would instead pay $15-20 to Disney for a stand-alone ESPN plan. DirecTV Now offers the ESPN networks and 60 others for just $35...or a discounted rate of just $10 per month to AT&T customers with unlimited cell phone plans.

As a matter of fact...nesn started streaming this year...but like most hbo and showtime subscriptions...it's tied to subscriber accounts.

Everybody still gets theirs.

 

[Lee Matthews]

we have disney life in the uk and its £4.99 p/m ....and with a 1YO its a lifesaver tbh, im guessing this is a building on from this service?

I've tried Disneylife and while at £5 a month it's a good deal. There really isn't that much content there, especially outside of the movies which I already on disc. I can see this service replacing Disneylife though in the long term

I currently pay £35 a month for SKY TV including movies. I'd say 70% of what I watch can we watched for free on freeview and the rest is Disney based content.

If this streaming platform was to really offer everything under the Disney banner then I'd pay as high as £15 a month.

For me I think ABC content could be really important to making it a service for all the family and not just Disney, Marvel or Star Wars fans. I love Modern Family and if shows like that were exclusively on there, I'm sold

 

[Miffy]

Dear Disney, Please purchase Netflix.

 

[jknezek]

We cut the cord earlier this year. We picked up Netflix and Playstation Vue, got ride of Uverse. My bill went from $180 to an all in around $100. However, we still don't have good access to CBS. Playstation Vue provides the Disney Channels and ESPN, but it's not really that cheap. I think it's going to be about $50 when my "introductory offer" runs out. Making the whole package about $110. Now if I had to pay for CBS, that's another $10, and it may come to that. There really isn't much advantage to this, as I could have argued with Uverse and gotten my old bill back to the same area. If I have to pay Disney for their separate stream, it's probably more expensive, though less of a hassle.

It'll be interesting to see how all the pricing sorts itself out. Personally, I think eventually you'll be able to go pure ala carte. You want CBS? $5 for live, another $5 for archive. Same for NBC, ABC, and Fox. You want to add the ancillaries like TBS? Maybe another $5. You want Disney Channels? $10. Archives? $10. ESPN? $10. I don't know why you'd want the archives, but I'm sure they'll price that too.

If they eventually get to this stage, I'm sure I'd get what I want, and I'd probably be paying about $120. Making very little difference overall from where I started with hated Uverse after fighting with them to retain me, where we stand now with a cord cutter that probably loses money hand over fist, and where we'll end up. I'll lose content each time, and pay about the same, but I'll get exactly what I want instead of whatever crap Uverse wants to shove down my throat.

We will see if Disney, and the other content provider streams, prices themselves right out of this market or not.

 

[ucfknight]

Dear Disney, Please purchase Netflix.

It would likely take ~$90 billion in cash/stock to purchase Netflix. That's about half of Disney's market cap. Not likely, or necessary. They've just spent under $3 billion buying a majority stake in BAMtech to have access to the technology platform that will run the Disney streaming service. Disney owns all of the content they'll put on their service.

 

[bladiator]

I'm fine with this and may pull some subscribers away from Netflix.

Seems like we don't have to worry about this for a while though. They didn't say when these things are leaving Netflix? Just that they are?

The question is .. what will they put on here? If they continue this "vault" stuff to help push sales to their DVDs, then i don't think people will like it as much.
But if they put EVERY Disney Classic movie on there and put things like the old Duck Tales on there (and the similar 90s shows) you will probably have people flocking to it in droves. Odds are though they will pull things on/off of here as it keeps subscribers hooked in as "new" stuff keeps trickling in.

This is what I'm talking about. Currently I'm spending like $4.99 to watch an old 70s/80s Disney movie that I remember from my childhood and they aren't disappointing me. There's also a lot of movies that I remember that were my favorites that just don't seem to exist anywhere except in my dad's VHS collection from the Disney Channel days (The Omega Connection for one .. or renamed to the "London Connection" .. worse name for sure).
Anyways, if you just gave me access to all that content, I would gladly drop Netflix and go only Disney (like it was meant to be).

 

[ucfknight]

What I'm curious about is if Disney will pull their content from Hulu and sell off their stake in that company to go all-in with this new wholly owned service (a la CBS), or if they'll hedge their bets with a continued stake in Hulu.

 

[tjkraz]

As a matter of fact...nesn started streaming this year...but like most hbo and showtime subscriptions...it's tied to subscriber accounts.

Everybody still gets theirs.

If NESN "just" started it this year, they may be the last network to offer streaming as a supplement to cable/sat. Every network I can think of offers some form of app streaming, but you need those cable/sat credentials in order to activate.

What I'm proposing is that RSNs like NESN, YES, Fox Sports and Comcast may eventually offer a stand-alone subscriptions which bypass the cable/sat provider. Customers would still only get their regional coverage. NESN's broadcast agreement is limited to the New England area, so they couldn't sell a package with Celtics and Red Sox games to someone living in LA. But instead of paying for a cable bundle to get that channel, NESN may offer locals a $6-8 per month stand alone subscription.

I emphasize "may" because I have no idea if the RSN licensing agreements even allow them to go this route. And there are situations where cable nets own the RSNs--like Comcast Sports Net--and would have little interest in offering a cable-free alternative.

 

[Miffy]

It would likely take ~$90 billion in cash/stock to purchase Netflix. That's about half of Disney's market cap. Not likely, or necessary. They've just spent under $3 billion buying a majority stake in BAMtech to have access to the technology platform that will run the Disney streaming service. Disney owns all of the content they'll put on their service.

Well, darn. I thought I'd try! We cut the cord a couple of years ago and have Netflix and Amazon Prime. I have no intention of buying any other service and sometimes think about getting rid of Netflix. The less TV I watch, the less I want to watch. Meanwhile, our clever cable provider just decided to start charging us a monthly fee for the free modem we've had for years. I'm guessing they've lost a lot of so-called triple play customers and are trying to make up the difference. They also call us at least 2 or 3 times a month to try to get us to upgrade our Internet service.

 

[ucfknight]

Well, darn. I thought I'd try! We cut the cord a couple of years ago and have Netflix and Amazon Prime. I have no intention of buying any other service and sometimes think about getting rid of Netflix. The less TV I watch, the less I want to watch. Meanwhile, our clever cable provider just decided to start charging us a monthly fee for the free modem we've had for years. I'm guessing they've lost a lot of so-called triple play customers and are trying to make up the difference. They also call us at least 2 or 3 times a month to try to get us to upgrade our Internet service.

OT... but just in case you didn't know you don't have to rent your cable company's modem to use their service. You can buy a good DOCSIS 3.0 modem from Amazon for about $50. My cable company (I won't name any names, but they own a large theme park complex in Orlando) currently charges suckers customers in my area an insane $8.99 per month to rent one of their modems. If you buy your own it pays for itself in less than half a year.

 

[TwoMisfits]

Here's the thing for all these "pay stand alone" channels...

100s of channels will probably go out of business...no one will pay $30-$50/year (at $2-$4/month) for most channels on tv...and it will be very hard for new channels to stand up without tons of advertising and content properties...no one's buying "movies r us" or "reality tv r us" without knowing already what they are getting...

And the thing is...many of these channels, even if they get 1st subscribers, are gonna struggle to stay in business...in the era of youtube and stuff falling out of copyright/trademark, a lot of "old" properties are available to stream free...so it's mostly the new content that you'll need to grab subscribers...and when they can watch this content faster (23 episodes in 23 days vs the normal 9 month commitment would be SO easy - heck, some folks do this in a 3 day weekend, you'll need to create more worthwhile content faster or parcel it out so they feel satisfied to keep you, so you'll literally have to drop new seasons of shows every week...that gets expensive, especially when you can't have commercials and advertisers paying you to support the content...

I can't see "go it alone" networks working without also playing along with a "consolidator"...people just don't care enough about the properties to stick with you when they see how much stuff costs...

Like I like the NCIS universe on CBS...but if you want me to pay another $75/year to like it, I'd probably find something else to satisfy my time that's free...b/c I don't like it THAT much...I like it b/c it's already paid and it's fluffy entertainment...but I can play free apps and stream free Youtube and read blogs and message boards for fluffy entertainment...

 

[Miffy]

OT... but just in case you didn't know you don't have to rent your cable company's modem to use their service. You can buy a good DOCSIS 3.0 modem from Amazon for about $50. My cable company (I won't name any names, but they own a large theme park complex in Orlando) currently charges suckers customers in my area an insane $8.99 per month to rent one of their modems. If you buy your own it pays for itself in less than half a year.

We just found out yesterday and started shopping for a modem today. We also have the cable company's router, which has been free so far. I'm guessing they'll charge us for that next!

 

[lockedoutlogic]

If NESN "just" started it this year, they may be the last network to offer streaming as a supplement to cable/sat. Every network I can think of offers some form of app streaming, but you need those cable/sat credentials in order to activate.

What I'm proposing is that RSNs like NESN, YES, Fox Sports and Comcast may eventually offer a stand-alone subscriptions which bypass the cable/sat provider. Customers would still only get their regional coverage. NESN's broadcast agreement is limited to the New England area, so they couldn't sell a package with Celtics and Red Sox games to someone living in LA. But instead of paying for a cable bundle to get that channel, NESN may offer locals a $6-8 per month stand alone subscription.

I emphasize "may" because I have no idea if the RSN licensing agreements even allow them to go this route. And there are situations where cable nets own the RSNs--like Comcast Sports Net--and would have little interest in offering a cable-free alternative.

In those cases...and SNY...the teams own all or part of the RSN...which means that's a valuable part of their ownership portfolio...

So they can't cut out cable providers and go direct...they'd just be cutting themselves off at the knees.

 

[maltdizzy]

What I'm curious about is if Disney will pull their content from Hulu and sell off their stake in that company to go all-in with this new wholly owned service (a la CBS), or if they'll hedge their bets with a continued stake in Hulu.

They said their deals with Hulu, including some back-catalog movies, will continue as usual.

While short on details,the press releases implies two streaming services — one for ESPN and one for Disney Studios/Pixar Studio content. ABC, Marvel, Lucasfilm, etc. may not be part of either. But 2019 is a ways off.

 

[tjkraz]

In those cases...and SNY...the teams own all or part of the RSN...which means that's a valuable part of their ownership portfolio...

So they can't cut out cable providers and go direct...they'd just be cutting themselves off at the knees.

Do you mean to say that the cable provider owns some/all of the RSN? If so, yes that is true in certain areas. But not all. (If the team owns the RSN, I suspect they would be glad to sell a la carte subscriptions to gain viewers.)

I live in a part of Ohio that typically gets Fox Sports Ohio, Sports Time Ohio and Fox Sports Detroit. Those 3 networks are offered on pretty much every cable/satellite/OTT streaming service...ATT Uverse, Dish, DirecTV, Sling, PS Vue, etc. If there are any ownership ties between the RSNs and providers, it isn't enough to prompt exclusivity...not like Comcast+CSN.

What I'm proposing is that these RSNs could take the same approach ESPN will soon follow: Eliminate the cable/sat/OTT middle man and sell a streaming plan directly to the consumer. Again, no idea if their agreements with the major sports nets would permit this. But it seems like a necessary evolution. When consumers "cut the cord", RSNs are among those losing subscribers. I know there are people in this area who would pay $5-10 per month to see their Indians/Tigers/Cavs/Pistons games.

 

[dreiwhit]

100s of channels will probably go out of business...no one will pay $30-$50/year (at $2-$4/month) for most channels on tv...and it will be very hard for new channels to stand up without tons of advertising and content properties...no one's buying "movies r us" or "reality tv r us" without knowing already what they are getting...

I can't see "go it alone" networks working without also playing along with a "consolidator"...people just don't care enough about the properties to stick with you when they see how much stuff costs...

FWIW, we balk at paying the $4.99 a month for additional channels. We just do without, and are perfectly happy.

I agree with you TwoMisfits. I can't see charging $4.99 a channel per month to be a successful business model. The cost for consumers will add up quickly. And if they have a month-to-month contract, there's no way to project revenue streams. Most channels except for the big ones will quickly disappear. And for the ones that are left, how many will have anything on there you actually want to watch?

But if the industry continues to shift in this direction, even moderate content consumers may end up paying $75 per month for 10 networks.

What we would do would be to just do without. We cut the cord on February 9th of this year, and to be honest, we really haven't missed it. Although I've watched documentaries on YouTube for years, my wife and children discovered YouTube recently, and that is the bulk of our streaming.

The networks and the studios really need to proceed with caution. If they create their own streams, they run the risk of losing viewership and eventually, going away!

 

[lockedoutlogic]

Do you mean to say that the cable provider owns some/all of the RSN? If so, yes that is true in certain areas. But not all. (If the team owns the RSN, I suspect they would be glad to sell a la carte subscriptions to gain viewers.)

I live in a part of Ohio that typically gets Fox Sports Ohio, Sports Time Ohio and Fox Sports Detroit. Those 3 networks are offered on pretty much every cable/satellite/OTT streaming service...ATT Uverse, Dish, DirecTV, Sling, PS Vue, etc. If there are any ownership ties between the RSNs and providers, it isn't enough to prompt exclusivity...not like Comcast+CSN.

What I'm proposing is that these RSNs could take the same approach ESPN will soon follow: Eliminate the cable/sat/OTT middle man and sell a streaming plan directly to the consumer. Again, no idea if their agreements with the major sports nets would permit this. But it seems like a necessary evolution. When consumers "cut the cord", RSNs are among those losing subscribers. I know there are people in this area who would pay $5-10 per month to see their Indians/Tigers/Cavs/Pistons games.

No...I'm saying that a growing number of teams own the station they are on.

Yankees and mets are 100%
Rangers/knicks (the dolans own cablevision and msg)
Red Sox own 90% of nesn (bruins the other 10)
The dodgers have a cream puff deal with fox they wouldn't dare mess with.
The orioles are big stakeholders in masn...
I'm sure there's more that I'm unaware of...

I'm saying if those stations went direct and bypass direct tv, Verizon, Comcast, timewarner (whatever it's called now)...they'd devalue themselves by cutting off the fees and advertising paid by those cable/satellite operators.

The rsns are what hold a lot of subscribers hostage to the cable companies...they're still worth a lot and the teams that own them rake.