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Netflix is facing increased competition in the streaming world thanks to new entrants like Disney+ and HBO Max. Netflix is still on top, with more than 200 million subscribers, but Disney+ is surging with more than 87 million paid subscribers of its own. During Netflix’s latest investor briefing, CEO Reed Hastings and other executives discussed competing with Disney.
Hastings praised Disney for what it has achieved, and Disney’s success is fueling Netflix’s energy and enthusiasm for doing better with its own platform. Disney+’s success also speaks to the wider trend that people are eager and willing to pay more and more money for entertainment, which is a positive for the media landscape overall, the executive said.
“It is super-impressive what Disney has done. Incredible execution for an incumbent to pivot and taking on an insurgent. So that’s great. And it shows that members are interested and willing to pay more for more content, because they are hungry for great stories,” Hastings said. “And Disney does have some great stories. So it gets us fired up about increasing our membership, increasing our content budget, and it’s going to be great for the world that Disney and Netflix are competing show by show, movie by movie.”
Hastings went on to say that Netflix is “fired up” about doing more to catch up to Disney in the area of family animation, which Disney dominates with Pixar and other internal studios. But speaking more generally about providing entertainment to members, Hastings said Netflix feels confident about staying on top, and this is helped by the fact that Disney only makes family- content while Netflix is known for casting a wider net.For what it’s worth, Disney also owns Hulu, which makes a variety of more adult-themed programming like The Handmaid’s Tale.
“We’re very fired up about catching them in family animation; maybe eventually passing them, we’ll see. A long way to go just to catch them,” he said. “And maintaining our lead in general entertainment, like Bridgerton, which I don’t think you’re going to see on Disney anytime soon.”
Also during the briefing, Netflix boss Ted Sarandos pointed out that Christmas Day 2020 was massive for not only Netflix, but also Disney+ and HBO Max, further demonstrating that a rising tide can lift all ships. Netflix released Bridgerton on December 25, while HBO Max put out Wonder Woman 1984 and Disney+ released Soul on that day.
The fact that three services can all succeed at the same time points to the tremendous appetite that consumers have for content, Sarandos said. Like Hastings, he also mentioned that it shows that people are willing to pay more to subscribe to additional services.
Finally, Netflix management pointed out that Disney+’s 87 million subscriber number is not exactly the full story. Netflix estimated that around 37% of Disney+ subscribers actually came from the Disney-owned HotStar streaming service in India, making the true number of subscribers only around 60 million. Netflix also pointed out that its average revenue per user is more than double the rate for Disney+, so Netflix is making more cash per subscriber.
You can watch the full investor briefing in the video above.
For more on Netflix, check out GameSpot’s roundup of every TV show and movie coming to the platform in February. Netflix has a lot more coming, as it plans to release a new original movie every week this year, while it also has more than 500 programs in post-production right now.
