Disney has decided to pull its content from Netflix and establish its own rival streaming service.
Back in 2012 content giant Disney entered into a licensing deal with Netflix, who, at the time, barely had a presence outside of the United States. Netflix is now operating in 190 countries and in excess of 100 million subscribers - the game has certainly changed, and so Disney has to, too.
Disney has announced it will end its distribution deal with Netflix and launch its own streaming service in 2019. In an attempt to preserve the relationship, or perhaps due to licensing obligations, Disney is cutting the ties slowly.
Netflix will continue to keep Disney’s entire collection until the 2019 launch, and even after that it will be keeping hold of Disney's Marvel collection. This means Netflix will still have rights to the next two Star Wars films, which is a big asset to keep hold of, but will be missing out on the final installment of the Star Wars trilogy.
Disney’s service is being built off BAMTech’s technology, a company that Disney is in the process of acquiring majority shares in. The new service will kick off with Toy Story 4 and the sequel to Frozen and will host the vast collection of Disney content, including its Pixar animation works.
Disney's move is not unique and there's a good chance that Netflix saw this coming. As we've seen with the success of other content owners who have adapted into streaming platforms themselves, content consumption is rapidly changing.
As consumers, we want the ability to limit subscription packages to content that we actually want to watch, meaning that the days of a one-stop entertainment shop are behind us? Or, are we already tired of having to subscribe to this, that and the other, just to keep up with the latest films, shows and sport?
Disney's move is following the trend for content owners to reach consumers directly - but is this trend sustainable? It's a 'watch this space' to see how the market reacts to these big changes in the game of entertainment.
The move is a real blow to Netflix, which secured a valuable streaming deal with Disney back in 2012 — before streaming had really taken off.