Should we be surprised at another eye-opening estimate for new streaming service Disney+?
Media analyst Bernie McTernan of Rosenblatt Securities estimates Disney+ could have just under 40 million subscribers at the end of the year -- more than double the initial Wall Street
estimates of 18 million.
McTernan believes Disney+ already has 25 million subscribers -- for a service only two months old. By way of comparison, Netflix took around 10 years to get to its
current number: a 60 million+ U.S. subscriber level.
Surely, Disney+ got that big boost -- 10 million or more -- from Verizon’s deal to offer broadband customers free Disney+ for a
year.
In addition, many analysts might credit this rise to modern TV consumers' increasing acceptance of TV streaming services -- paying for as many as three to five streaming services per
month.
Which is why major legacy TV companies want to quickly launch their own streaming efforts -- subscription/no advertising services, ad-supported/free services and everything in
between.
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It isn’t just NBC’s Peacock or AT&T’s’ HBO Max, but other traditional pay TV companies -- such as ViacomCBS, Discovery, AMC Networks -- pushing premium
streaming efforts. Those companies have a couple of niche services already out -- with ViacomCBS’ bigger and broader-based CBS All Access making steady gains.
Inclusion into a key group
of three to five big streaming services may come at the expense of existing traditional pay TV services -- cable, satellite and telco, which means some collateral damage to specific networks. Still,
for the time being, other analysts believe new streamer sign-ups could be a consumer add-on, with much content overlap.
Brand awareness will have much to do with success. For example, in a
Rosenblatt Securities survey of more than 200 streaming-video consumers conducted on Dec. 29, McTernan says 96% of respondents are now aware of Disney+. In October, it was 63%.
It's fair
to assume some of this consumer interest will have a spillover effect on other streamers, which will create higher business metrics -- including growing subscribers.
But it also raises
confusion about where the business will land. For instance, which companies will really make money from these narrow profit-margin businesses once initial marketing promotions and hype fade?