Pixel Envy

Written by Nick Heer.

Disney to End Agreement With Netflix, Will Offer Own-Brand Competitor

Todd Spangler, Variety:

Disney is ending its distribution agreement with Netflix for new movie releases, while it’s also buying majority ownership of BAMTech — the streaming-video division founded by Major League Baseball — in a $1.58 billion deal.

The moves set a firm course for the media giant to launch direct-to-consumer internet services from ESPN and Disney. Disney said will end its distribution agreement with Netflix for subscription streaming of new movie releases, beginning with the 2019 theatrical slate.

This attempt at self-distribution might actually work out for Disney — though that’s a big “might”, given how entrenched Netflix is in many of our lives. Despite struggling recently, ESPN is still the highest-valued channel amongst cable providers, according to a Beta Research survey from earlier this year. Paying separately for ESPN is not as ideal as a single subscription, of course, but baseball fans already pay $3 per month for MLB at Bat.

Disney itself remains one of the most well-known names in film and television. I’m not sure how many people would pay $10 every month for access to Disney films and television shows exclusively, but I’m sure there’s an audience there, given the size and scope of their influence. Remember: Disney also owns Pixar, Lucasfilm, and Marvel Studios, and they have large shares in lots of other media companies, like A&E and Vice. Even if their streaming service only has movies and TV shows from companies owned by Disney, that still represents some of the biggest annual releases.

As usual for gigantic companies, this argument doesn’t seem completely unreasonable for Disney because of what’s in their holdings portfolio. Self-distribution is also something that can work out alright for very small producers who have an emotionally-attached audience. I doubt that anything like this would work for companies in the middle, however.

But that leads down the same kind of slippery slope as the presumed end game of the revocation of net neutrality rules. That’s because Disney’s competitors are not Universal Studios, DreamWorks, or Warner Brothers directly, but larger media conglomerates like Comcast, Verizon, and — soon — AT&T. Is Disney interested in becoming an ISP, too?

Update: I’ve updated the title of this post to be a little more accurate. They are pulling their films, just not yet. Sorry, it’s a dumb mistake.