When Disney turns into +1, Streamer drops 73 million subscribers

A year ago today, the Disney + streaming service made its major public debut. Since its first anniversary, the crown jewel of Disney's streaming ambitions has already cleared 73.7 million subscribers, the company announced today.

This early success contrasts with the old businesses that continue to give way under relentless pressure from Covid-19.

"The real bright spot in the midst of the pandemic was our direct customer business," CEO Bob Chapek told investors on Thursday during the company's quarterly and annual results. "A year ago today, we launched Disney + and it has quickly exceeded our highest expectations."

It's not just Disney +, however: Disney is making noticeable gains across its entire streaming portfolio. The total number of Hulu subscribers in October was 36.6 million. This corresponds to an increase of 28% over the previous year and a moderate increase of 400,000 subscribers over the last quarter. These Hulu subscribers come primarily through their on-demand video service, which has 32.5 million subscribers. Hulu's live TV offering, the most expensive product in Disney's streaming portfolio, had 4.1 million subscribers, up 41% year over year.

ESPN + now had 10.3 million subscribers, a growth of 1.8 million over the previous quarter and an increase of more than 100% over the previous year.

Part of that streaming growth can be attributed to the continued international rollout of Disney +. Those gains are expected to continue into the fourth quarter as Disney + expands in Argentina, Brazil, Chile and other Latin American countries. It's also backed by the Disney + package, which the company has been promoting heavily. This package slightly lowers the average revenue per user, but has contributed to the growth.

While the streaming company isn't breaking out on its own, revenue in its direct and personal segments, which includes streamers, rose 41% in the quarter to nearly $ 4.9 billion. Operating losses in this segment decreased nearly a quarter to $ 580 million.

Chapek said the company will continue to put money into original and other programs to empower its streamers' libraries and keep customers from coming back. Spending will also increase as Disney prepares an international service. These efforts will premiere under the company's Star brand in 2021. The company has set an Investors Day on December 10th, which will feature further details on this streamer in detail.

"You will see that we are setting sail and investing heavily in the Disney + business," said Chapek. “We will continue to increase our investments in DTC and significantly shift the scale of linear networks to our DTC business. We see this, as we said in our opening comments, as our main catalyst for growing a company. "

That magnitude was evident in the ongoing reorganization within the ranks of Disney, which began in October with a reorganization of the company's media and entertainment business and continued this week with a reorganization within the general entertainment division.

Chapek said that given the other disruptions in the world, "this is the perfect time for such a reorganization" and that he had "100% buy-in" from across the company about the changes.

Some changes and experiments have proven more successful than others. The company made the bold decision to loan the live-action film Mulan as a premium title on Disney + this fall instead of a traditional theatrical release. While Chapek said the company was "very pleased" with Mulan's results, the company did not release any figures. One factor that Chapek acknowledged may have dampened the response: the film became controversial worldwide shortly after its release because it was shot in Xinjiang, a Chinese province where Uighur Muslims were held in concentration camps.

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