Disney Launching Disney+ a Week Early in Western Europe

Disney’s DIS direct-to-consumer (DTC) streaming service Disney+ is set for launch a week earlier than planned in Western Europe.

The streaming service will now be launched on Mar 24 in the UK, Ireland, France, Germany, Italy, Spain, Austria, and Switzerland. Other Western European markets like Belgium, the Nordics and Portugal are expected to get Disney+ by summer 2020.

Subscribers will be able to enjoy the streaming service on nearly all major mobile and connected TV devices, which include gaming consoles, streaming media players and smart TVs.

Subscription has officially been priced at £5.99/€6.99 per month, or £59.99/€69.99 annually.

Europe Launch to Boost Disney+ Growth

The decision to launch the service early in Western Europe comes after the huge success of Disney+ in the United States.

The streaming service’s user growth has been driven by its strong portfolio of offerings, which include the smash hit show, The Mandalorian, among others.

Notably, per Sensor Tower data, the Disney+ mobile app, which has been downloaded nearly 41 million times across the App Store and Google Play, generated an estimated $97.2 million in user spending within two months of its debut on Nov 12, 2019.

The early launch highlights Disney’s focus on gaining market share aggressively and is expected to aid the company in acquiring subscribers in Europe.

However, the huge investment on developing content is expected to hurt profitability. Management expects the DTC & International Interactive Media segment to report roughly $800 million in operating losses for the first quarter of 2020.

Notably, in fourth-quarter fiscal 2019 DTC & International segment operating loss widened to $740 million from $340 million in the year-ago quarter.

Strong Competitive Position

The launch of Disney+ in Western Europe will aid Disney in gaining a foothold in the lucrative European market where competitors like Netflix NFLX, Amazon’s AMZN prime and Apple’s AAPL Apple TV+ already have a presence.

Notably, the service’s lower subscription cost of £5.99/€6.99 per month in Europe gives it an edge over Netflix and Amazon prime video.

Netflix’s standard subscription costs £7.99/€10.99 per month in Europe while prime video costs £7.99 per month in the UK. However, prime video’s cost in other European countries is cheaper at €5.99 per month.

Disney+ also has a higher customer satisfaction score of 76% compared with Netflix’s 74% and prime video’s 66%. The figure is also higher than 48% for AppleTV+, per YouGov data, quoted by investors.com.

Zacks Rank

Disney currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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