A performer dressed as Mickey Mouse will entertain guests as they reopen Disneyland Theme Park in Anaheim, California, USA on Friday, April 30, 2021.
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Disney seems to have picked up a little Netflix flame.
Just as Netflix added less than 4 million global subscribers in the first quarter, disappointing investors, Disney announced that it currently has 103.6 million Disney + subscribers. Disney’s share price fell about 4% in after-hours trading.
On the surface, both Disney and Netflix can explain the disappointing growth by quoting the early pandemic audience surge. The logic is simple. In the first six months of the pandemic, far more people signed up for Disney + and Netflix than companies expected. Given the surge, it’s not surprising that growth will return to more “normal” levels as the pandemic subsides.
In addition, both Disney and Netflix safely assume that subscriber growth will accelerate later this year as program production resumes with high-profile content such as “Loki” and “Luka” for Disney. I can do it. Streaming video later this year.
But there is one big difference between the two companies that are far short of Disney. That’s the average revenue per user.
The average revenue per Disney + user, excluding Indian hotstars, was $ 5.61 per month. Netflix’s ARPU in the US and Canada in the previous quarter was $ 14.25 per month, up 9% from a year ago.
If growth is sluggish, we want our customers to pay as much as they can. Disney’s Hulu subscription video-on-demand service ARPU is high, at $ 12.08 per month, but its growth is negligible, up just two cents per month from a year ago. Hulu has 37.8 million subscribers, including 41.6 million who also buy live TV.
This is not yet of particular concern to Disney CEO Bob Chapek, who said “all single markets are above expectations” regarding the addition of global subscribers. He also pointed out that Disney is still expanding into new countries internationally, with Malaysia and Thailand coming in June.
But Disney + has jumped into the Streaming Big League. A logical comparison of Disney + in 2020 was HBO Max, Peacock, and other new media streaming services.
Given Disney’s success, this year’s comparison is Netflix. Disney already forecasts 230-260 million subscribers by 2024. It’s Netflix-land (Netflix has about 208 million customers).
Netflix has been able to gradually raise prices over the years without stopping global growth. Disney may be able to do the same, but the big difference in ARPU between the two companies marks a long way to go.
Disclosure: Peacock is a video streaming service of NBCUniversal, CNBC’s parent company.
Like Netflix, ARPU is much lower, slowing Disney + subscriber growth
Source link Like Netflix, ARPU is much lower, slowing Disney + subscriber growth