At $133.21, Walt Disney stock is up 1.22% as of 3:27 PM EDT. Year-to-date through the closing bell on August 28, Disney (DIS) stock has gained 26%.
In contrast, Netflix stock is up only 9.0% so far this year. Dish Network (DISH) stock also has soared this year, up more than 33% through August 28. Dish stock has sprinted this year, as investors reacted to its efforts to enter the wireless phone service market.
Disney stock up, UBS study shows high interest in Disney+
UBS released a study showing that interest in its Disney+ video streaming service may be stronger than previously understood. According to the study, which was reported by CNBC today, 43% of Americans intend to subscribe to Disney+. That makes Disney’s projection for Disney+ demand look conservative.
In April, Disney projected that its Disney+ service would have 60 million–90 million US subscribers by 2024. This estimate shows that Disney looked at 20%–40% US penetration for Disney+ by 2024.
Interest in Disney+ looks especially strong considering that the service is still months away from launch. Disney+ is slated to launch on November 12. Disney is withdrawing its movies from Netflix (NFLX) to offer them exclusively on its Disney+ service to boost its appeal.
D23 event launches Disney+ discounts
During its annual D23 event last weekend, Disney opened an opportunity for US residents to preorder Disney+ at a steep discount. Following the company’s D23 event, interest in Disney+ could be stronger than even the UBS study indicates.
Starting on August 26 through September, US residents can sign up for Disney+ for $46.99 a year, which is a considerable discount to the regular annual price of $69.99. The $46.99 annual price works out to about $3.92 a month. The regular monthly price for Disney+ would be $6.99 per month.
Disney signals a price war with Netflix
Disney has indicated that it may wage a price war to try to attract subscribers from competitors such as Netflix. The $6.99 monthly pricing of Disney+ makes it competitive to both Netflix’s basic and standard plans, which cost $8.99 and $12.99, respectively.
Apple also plans to launch its video service called Apple TV Plus this fall. Bloomberg reported last week that Apple TV Plus could cost $9.99 a month, which would still make Disney+ a bargain at $6.99 a month.
Disney is signaling a price war at a time when its primary rival, Netflix, is already facing price resistance. A study released last month by Kill the Cable Bill showed that a quarter of Netflix subscribers think the service has become too expensive. In the second quarter, Netflix missed its subscriber addition targets as some customers resisted its price increases.