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The Force (And Sub Growth) Is Strong With Disney+

Big news: Disney reached 95M subscribers in 14 months. It took Netflix roughly 9 years to reach this mark.

Streaming Race Graph

Disney+ subscribers (QoQ growth):
1) 2019-Q4 – 28.6M
2) 2020-Q1 – 54.5M (↑ 91%)
3) 2020-Q2 – 60.5M (↑ 11%)
4) 2020-Q3 – 73.7M (↑ 22%)
5) 2020-Q4 – 94.9M (↑ 29%)

Disney+ Passes 90M Subscribers Three years Ahead of Schedule Graph

Disney streaming subscribers by platform (% of total) according to Variety:
1) Disney+ – 94.9M (65%)
2) Hulu – 39.4M (27%)
3) ESPN+ – 12.1M (8%)
4) Total – 146.4M

Big question #1: Is comparing Netflix and Disney+ by subscribers apples to apples?

Quick answer: No. Disney+ currently charges 63% less per subscriber per month (ARPU).

Monthly ARPU comparison during 2020-Q4:
1) Netflix – $10.80
2) Disney+ – $4.03

Monthly ARPU for Disney+ (QoQ growth) according to LightShed Partners:
1) 2019-Q4 – $5.56
2) 2020-Q1 – $5.63 (↑ 1%)
3) 2020-Q2 – $4.62 (↓ 18%)
4) 2020-Q3 – $4.52 (↓ 2%)
5) 2020-Q4 – $4.03 (↓ 11%)

Big question #2: Why is ARPU for Disney+ declining?

Quick answer: India/Hotstar. ≈ 30% of Disney+ subscribers come from Hotstar in India with an ARPU of ≈ $1.

Big question #3: Is this bad for Disney?

Quick answer: No. Disney’s focus is on building a global subscription base.

Flashback: Can Disney+ Keep The Magic Alive?

Big question #4: How can Disney+ become more significant for Disney?

Quick answer: A rundle.

WTF is a rundle? A rundle is a bundle of services with a recurring revenue (subscription) business model (h/t: Scott Galloway).

A Disney rundle could include:
1) Member-only access to parks
2) Member-only cruises
3) Early access to in-home viewing for tentpole films

Quick math on a Disney rundle:
1) 85M families w/ children in the US, Japan, and the EU
2) 52M subscribe to Disney rundle
3) $50 per month
4) $2.6B per month
5) $31.2B per year

Big question #5: What drove the Disney+ sign-ups last quarter?

Quick answer: The Mandalorian and Soul.
Disney+ Daily Signups Graph
Quote from Marc Randolph – Co-Founder and Original CEO @ Netflix:

“We’re seeing the new rules of the game developing. This is not just announcing, this is not just having a promotion — what you have to demonstrate is that you have the content, content content. And it’s not just a few things. You have to have a continuous slate of new things coming out. It’s really a war of who’s prepared to make the content.”

Video: How Disney+ Became a Streaming Service Heavyweight

More #1: What if one of Disney’s most important acquisitions didn’t happen?

 

More #2: Disney Plus’ Star Wars Assault: From ‘Obi-Wan’ to ‘Boba Fett,’ a Look at What Comes Next

 

More #3: How The Mandalorian Changed Disney’s Star Wars Strategy

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