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Disney's new streaming service to be priced "significantly lower" than Netflix

AP Photo/Richard Drew

Disney is revealing more details about its new over-the-top digital entertainment app that will launch in 2019.

Why it matters: Legacy entertainment businesses are becoming very difficult to sustain in an era where consumers want on-demand, digital video that they can access at scale from tech companies like Netflix and Facebook. Linear options, like movies delivered in theaters and primetime shows on cable TV, are becoming less appealing to consumers who want to watch everything on their own time and across many digital devices. This is part of Disney's push to be a competitor to Netflix in the direct-to-consumer entertainment space.

The details:

  • The new OTT product will be priced "significantly lower than Netflix," CEO Bob Iger says. Iger notes that the service will launch with less volume than Netflix but with quality content that centers around three of its top brands: Pixar, Marvel and Star Wars.
  • The new streaming service will be commercial free, according to Iger. While the Walt Disney Co. plans to integrate commercials into its sports streaming app, Iger says "We're not planning to have the programming that airs in the DTC service interrupted by commercials." Iger did say that sponsored programmed is being considered.
  • The name of the product has yet to be determined, says Iger. "We're working on the cadence in which we will schedule and produce in the OTT service."
  • A brand new Star Wars trilogy coming to Disney. It will be launched by the Star Wars: The Last Jedi Director Rian Johnson, who will write and produce the trilogy with producer Ram Bergman.

Go deeper: Disney is reported to have approached 21st Century Fox about a deal to acquire its entertainment and studios businesses, including 21st Century Fox studios as well as National Geographic, FX cable channels and more.