Disney+’s First Two Months Are Unprecedented In the Industry
Disney’s first foray into streaming was a hit right out of the gate with more than 10 million sign-ups at launch! The company carried this momentum through the first two months of with hits like The Mandalorian cementing it’s position as a must-have service. During it’s first 60 days Disney+ has racked up more than 41 million downloads of the app!
However with The Mandalorian on hiatus until December and some titles disappearing from the back catalogue due to licensing issues, can Disney maintain this momentum throughout 2020?
Disney+ revenue through its first two months was 4X as much as HBO Now’s in its first two months. That’s despite the latter charging a subscription price twice as much as Disney+. However, what insiders are paying close attention to is Disney+’s decline in in-app revenue.
According to a recent piece on MotleyFool, Sensor Tower provided in-app purchase estimates for Disney+ and noticed that the Disney+ app declined after the first month (the figures went down from $53.3 million to $43.9 million) This seems to buck the trend as most streaming services see an increase month-over-month. Some industry insiders worry that this decline in revenue may indicate that Disney+ is having a hard time keeping its subscribers.
The Disney+ service offers discounted annual subscriptions meaning many subscribers may have opted for a year-long subscription at launch. This may partially explain the drop in number. As of going to print, investors don’t yet have a handle on what’s affecting numbers the most and Disney hasn’t released any metrics regarding whether more subscribers are going for the annual or month-to-month options.
Will subscribers stick around?
By the time you’re reading this, many Star Wars fans have already finished the 8-episode run of The Mandalorianthe most popular show on the service. A second series won’t be released until the very end of 2020. While Disney+ does have a mighty back catalogue and a range of new programming, none have captured the attention of the world quite like The Mandalorian. After all, this is the show responsible for Baby Yoda!
The step down we are seeing in in-app purchases during month two could indicate more month-to-month subscribers in Disney+ second month who may have signed up just to watch The Mandalorian. Those subscribers will be much more difficult to retain in month three and beyond.
Disney’s first Marvel series for Disney+ won’t drop until later this year either. The gap between exciting new programming may mean that subscribers will continue to drop throughout the year. Also, new competitors entering the market over the next few months, including HBO Max, will do their best to draw Disney subscribers away from the service during this “downtime”
SensorTower’s numbers show Disney+ has kept up its strong momentum. While the declining in-app revenue is notable, it’s not a big red flag so much as a yellow flag warranting a dive into the details management provides in its first-quarter earnings report next month.
Keep following along with MickeyBlog for updates on this story as Disney+ is sure to be the focus of the media company’s conference call taking place in just a few weeks!
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