In an unexpected turn of events, Disney has decided to end its content distribution deal with Netflix. Disney is looking to launch its own streaming service, the company announced today. The company plans to launch its streaming service in sometime 2019.
This deal broken by Disney is a great blow to Netflix. Netflix originally struck this great deal with Disney back in 2012, way before streaming had really taken off. Unfortunately for Netflix, this deal only kicked in last year, so the benefit for them and their customers didn't last very long.
Interestingly, Netflix won't lose its Disney collection immediately. If you're looking to enjoy the Disney collection on Netflix, the studio will not take them off of Netflix until 2019 films. Netflix customer will be able to stream movies, as well as the next two Star Wars movies through the end of 2019. Unfortunately though, Netflix customers will miss out on the new trilogy's final installment.
“We continue to do business with the Walt Disney Company on many fronts, including our ongoing deal with Marvel TV,” said a spokesperson for Netflix.
Disney's streaming service will be based off of technology from BAMTech, the MLB-founded video platform. We already know that Disney is a major investor in BAMTech, so it makes sense that Disney is going that route. Today, Disney announced that it's making an even bigger investment in BAMTech, a $1.58 billion investment which gives Disney a 75 percent stake in the company. Regulatory approval for acquisition is still currently going on.
In a statement, Disney CEO Bob Iger stated that “this acquisition and the launch of our direct-to-consumer services mark an entirely new growth strategy for the company, one that takes advantage of the incredible opportunity that changing technology provides us to leverage the strength of our great brands.”
With many companies looking to move to their own original content creation as well as looking to cut out the middle man, Disney is going exactly this route.