Disney’s falling ESPN subscriber numbers
The Walt Disney Company (DIS) has been losing ESPN subscribers for the past several years. It reported 88 million ESPN subscribers at the end of fiscal 2017, a fall for the fourth straight year.
The primary reason for Disney’s decreasing ESPN subscriber base is cord cutting, which allows subscribers to opt out of traditional and expensive cable or satellite subscriptions and watch sports through online video streaming services instead. Therefore, consumers have shifted mainly from watching ESPN on cable to watching sports via online streaming. Netflix (NFLX), Amazon Prime (AMZN), and Alphabet’s (GOOGL) YouTube have dominated the streaming industry, and they’re competing to attract consumers by offering original shows and programming.
Disney’s ESPN+ direct-to-consumer service
Disney has been making efforts to expand its presence in the over-the-top streaming business to combat its digital rivals. It recently launched its first direct-to-consumer offering, ESPN+, which offers online multisports packages as well as individual sports packages, to tackle falling ESPN subscriber numbers. ESPN+ costs $4.99 per month or $49.99 per year. The service has attracted more than 1 million paid subscribers in just six months since its launch in April.
ESPN+ features games from Major League Baseball, the National Hockey League, global soccer events, Top Rank Boxing events, and other college sports events. The company’s streaming service includes ~10,000 live sports events and other programming, and it has plans to add Ultimate Fighting Championship content to ESPN+ in January. The company believes that going forward, ESPN+ will continue to expand its content and enhance the user experience, becoming even more compelling to sports fans across the spectrum.
Disney also plans to launch a branded streaming service called Disney+ in 2019. The service will stream Disney movies and original programming. Additionally, after its completion of the acquisition of 21st Century Fox’s (FOXA) media assets, Disney will own a bigger stake in streaming service Hulu.