With Disney+ less than a month away from its U.S. launch, the company is making the case to consumers and investors that its streaming service will take off.
Why it matters: Disney has spent billions of dollars to add Fox, Marvel and the "Star Wars" universe to its content lineup, all of which should help it in the battle against Netflix, Apple and NBCUniversal, but it also means that Disney has a lot riding on its streaming service.
Driving the news: Disney was all over the media on Tuesday, with CEO Bob Iger speaking at Vanity Fair's New Establishment Summit and on CNBC. As Axios' Sara Fischer reports, the company ...
Disney's stock was up around 2% Tuesday after the slew of announcements.
What they're saying: Iger didn't seem to worried about mounting competition in streaming.
- "We're very, very different than the other services out there. So, while we view the others as competition, we're not fixated on the competitive side of things here," he said in an interview with CNBC's Julia Boorstin Tuesday.
Disney has launched a beta version of the service in the Netherlands, albeit without the new original content. Iger didn't say how many people have signed up there, but said demand "has been robust." Disney has previously indicated that it aims to reach 60–90 million subscribers by 2024.
Be smart: Those numbers may be easier to reach now, thanks in part to the partnership that was announced with Verizon Tuesday morning.
- According to Iger, the partnership is a wholesale deal, meaning that Disney+ will be paid by Verizon, although it's likely they'll receive less money than they would make if they sold the subscriptions to consumers directly.
- Iger says he thinks the deal will "have a significant effect" in terms of jump-starting subscriptions, as Verizon will help Disney market the new service. Disney will gain roughly 50 million temporary subscribers from the deal, per Reuters.
The big picture: The Verizon partnership follows a similar playbook that's being used by other rival streaming services: Give out as many subscriptions for free to boost your numbers, and worry about up-selling them later. Cases in point:
- Amazon offers video to subscribers for free as a part of its broader Amazon Prime subscription, which also includes free shipping and other benefits.
- Comcast says it will provide its ad-supported new streaming service Peacock, set to launch in April, to its cable customers for free.
- Apple will offer new iPhone buyers a year of its AppleTV+ subscription for free when it launches Nov. 1.
- Netflix is included for some T-Mobile customers as part of their mobile subscription.
The bottom line: Disney has spent billions of dollars in recent years adding big-name franchises to its content empire, most notably through its $71 billion acquisition of most of 21st Century Fox last year.
Our thought bubble: Disney's fledgling streaming business will be key to making those expensive content bets pay off.