The Strategist

Disney to spend $ 800 million for the first year of Disney+

04/11/2019 - 12:17

Analysts at UBS forecast that Disney will spend $ 800 million on content for its new Disney + streaming service in the first year of broadcasting.

“In the longer term, we expect Disney to continue to increase production of original content exclusively for Disney+ in order to add value to the proposal,” said UBS analysts.

Disney is developing original movies and TV shows for its future Disney+ streaming platform, including series from Star Wars universes and Marvel's superhero franchise. But one of the most important issues on the eve of the Disney Investor Day, which will be held on Thursday, is how much the company plans to invest in content.

Disney is going to launch the service at the end of this year, and we have already read the details of some of the original shows, which will be included in the huge and constantly growing content catalog on the platform.

Pricing policy of the company will be the main question. Representatives of Disney reported that the new streaming service would be cheaper than Netflix, and that was before Netflix raised the monthly fee by 18% earlier this year. If the company plans to launch Disney+ in the near future, the cost issue will be definitely discussed.

UBS analysts predict that Disney will release up to 10 original films and 10 TV shows for Disney+ for the first year, and will spend $ 800 million on content. "Disney spending on one episode for television series is expected to be in the range of $ 2.5-3.5 million, but this the amount can be increased up to around $ 10 million per month for some shows, experts say. “We expect the budget of the original films to be modest (on average $ 25–35 million per film) compared to Disney's cinema releases."

For comparison, in January, Barclays analysts estimate that Netflix will spend up to $ 3 billion only on original films this year. Vanity Fair estimates that this year $ 15 billion will be spent on all content compared to $ 12 billion in 2018. HBO spent $ 1.5 billion on original content in 2018, and Amazon will spend about $ 6 billion on original content this year for Prime.Video, CNBC reports.


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