Nine big questions re: Disney+:
1) When is Disney+ launching their ad-supported offering?
2) How much will Disney+ charge for the ad-supported offering?
3) How many streaming subscribers does Disney have?
4) Where is the growth coming from?
5) How much money do they currently make from each streaming subscriber?
6) Will ad-supported subscribers generate more revenue than ad-free?
7) What share of streaming viewership does Disney account for?
8) How much does Disney spend on content?
9) What Disney+ show has generated the largest share of viewing time?
Big question #1: When is Disney+ launching their ad-supported offering?
Quick answer: December 8th
Big question #2: How much will Disney+ charge for the ad-supported offering?
Quick answer: $7.99 (27% discount vs. ad-free)
Disney pricing by streaming service:
1) Disney+ (ad-free) – $10.99
2) Disney+ (w/ ads) – $7.99
3) Hulu (ad-free) – $14.99
4) Hulu (w/ ads) – $7.99
5) ESPN+ (w ads) – $9.99
6) Bundle w all three – $12.99
Big question #3: How many streaming subscribers does Disney have?
Disney+ subscribers (YoY growth):
1) 2020-Q2 – 57.5M
2) 2021-Q2 – 116.0M (↑ 102%)
3) 2022-Q2 – 152.1M (↑ 31%)
Disney streaming subscribers by platform (% of total):
1) Disney+ – 152.1M (69%)
2) Hulu – 46.2M (21%)
3) ESPN+ – 22.8M (10%)
4) Total – 221.1M
Total Disney streaming subscribers (YoY growth):
1) 2020-Q2 – 101.5M
2) 2021-Q2 – 173.7M (↑ 71%)
3) 2022-Q2 – 222.1M (↑ 27%)
Big question #4: Where is the growth coming from?
Disney+ YoY growth rate by region:
1) International (non-Hotstar) – ↑ 48%
2) India (Hotstar) –↑ 30%
3) US/Canada –↑ 17%
Flashback: Will 7M Viewers Follow Dancing With The Stars to Disney+?
Big question #5: How much money do they currently make from each streaming subscriber?
Monthly ARPU for Disney+ (YoY growth):
1) 2020-Q2 – $4.62
2) 2021-Q2 – $4.16 (↓ 10%)
3) 2022-Q2 – $4.35 (↑ 5%)
Monthly ARPU for Hulu (SVOD only)(YoY growth):
1) 2020-Q2 – $11.39
2) 2021-Q2 – $13.15 (↑ 15%)
3) 2022-Q2 – $12.92 (↓ 2%)
Monthly ARPU for Hulu (Live TV + SVOD)(YoY growth):
1) 2020-Q2 – $68.11
2) 2021-Q2 – $84.09 (↑ 23%)
3) 2022-Q2 – $87.92 (↑ 5%)
Monthly ARPU for ESPN+ (YoY growth):
1) 2020-Q2 – $4.18
2) 2021-Q2 – $4.47 (↑ 7%)
3) 2022-Q2 – $4.55 (↑ 2%)
Big question #6: Will ad-supported subscribers generate more revenue than ad-free?
Mr. Screens Crystal Ball: Ad-supported Disney+ users will eventually generate more revenue than ad-free users.
Quick math on the advertising model for Disney+
1) Ad minutes/hour – 4
2) 30s spots/hour – 8
3) CPM $ – ≈ $50
4) $/spot – $0.05
5) Ad revenue/hour – $0.40
6) ARPU > $10.99 @ 7.5 hours ($7.99 + $3.00 = $10.99)
Bottom line: Unlike Netflix, Disney knows how to sell ads. In 2021, they generated $7B in linear TV ad revenue, second only to NBCUniversal ($10B).
Big question #7: What share of streaming viewership does Disney account for?
Quick answer: Disney+/Hulu account for 5% of total TV time and 16% of streaming TV time.
Big question #8: How much does Disney spend on content?
Estimated U.S. content spend for Disney (YoY growth) according to Wells Fargo:
1) 2019 – $21.6B
2) 2020 – $28.9B (↑ 34%)
3) 2021 – $30.5B (↑ 6%)
4) 2022P – $32.9B (↑ 8%)
5) 2023P – $35.2B (↑ 7%)
6) 2024P – $37.8B (↑ 7%)
7) 2025P – $40.5B (↑ 7%)
Big question #9: What Disney+ show has generated the largest share of viewing time?
#20 – Quick answer: The Mandalorian.
Podcast: Disney+ and the Streaming Price Hike
