© Unsplash/Thibault Penin
In 2019, with the launch of Disney+, Disney positioned itself as Netflix's main competitor. And today, thanks to its immense catalog, Disney already claims 149.6 million subscribers across all of its streaming offers. However, despite this rapid growth, Disney believes it still lags behind Netflix. This was admitted by its CEO, Bob Iger, during the 2024 Morgan Stanley Technology, Media & Telecom Conference.
This delay does not concern the number of subscribers of the two platforms, but the technology used. For the boss of Disney, the company must put itself at the same technological level as Netflix, which he considers to be the benchmark. “When we launched Disney+ in 2019, our goal was to deliver fundamentally robust video experiences at scale”, he said. he declared, according to Variety. “What we didn't have was the technology we needed to reduce customer acquisition and retention costs , to increase engagement and to increase our margins by reducing marketing expenses.”
Currently, Disney is therefore focusing on developing the technology that will allow it to be on the same level as Netflix. Indeed, Iger believes that it is through technology that Netflix manages to reduce these margins. And it is because of its technological delay compared to its main competitor that Disney would have a higher churn rate than it should be.
Disney: subscriber count was down
Bob Iger makes this comment as Disney recently announced a slight drop in subscribers to its streaming services. In February, when presenting its quarterly results, Disney indicated that the number of its Disney+ Core subscribers fell by 1.3 million subscribers, compared to the previous quarter. A drop which is attributed to a high churn rate, due to price increases in the United States and the end of summer promotions in the rest of the world.
In any case, during the 2024 Morgan Stanley Technology, Media & Telecom Conference, Bob Iger assured that Disney still expects its streaming business (which includes Disney+, Hulu and ESPN+) to become profitable in the fiscal quarter that ends in September 2024. But he also stressed that Disney will not not only aims for profitability, the goal was to make streaming a real engine of growth for the company.
Disney has already started its transition to streaming. But, in the meantime, it continues to earn profits from linear television.
- Disney is one of Netflix's biggest competitors, and it has established itself in this market thanks to its vast catalog
- But Disney boss Bob Iger admits the company still needs to catch up with Netflix on technology
- Technology is key to reducing marketing spend , increase margins, and reduce churn
- In February, Disney announced a drop in the number of Disney+ subscribers
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