Netflix proves it’s essential at all times

As earnings season begins, one of the biggest emerging storylines is that Netflix Inc’s most formidable rivals, led by Walt Disney Co, already may be starting to falter. If Disney can’t get to where Netflix is, can anyone?
Netflix is set to kick off the industry’s quarterly reports next week on July 20, while investors will have an anxious wait until August 12 to get a look at Disney’s official numbers. Early indications are that Disney+ may be losing steam in the US as India — a country in which it earns far less money per user — becomes one of its biggest and fastest-growing markets. Global scale is crucial but to win the streaming wars, one must win the US.
Towards the end of Disney’s latest fiscal quarter, which wrapped up recently, the Disney+ service had 38 million users in India — the same number that it had in the US and Canada, The Information reported earlier this month, citing internal company data. For North America, that represents a slow crawl from the 37 million it had as of February. The internal data showed that total global subscribers stood at about 110 million, a level analysts previously expected Disney+ to reach in April; they were projecting 113 million by now.
A Disney spokesperson disputed the accuracy of The Information’s figures. Another caveat is that Marvel’s new “Loki” series that debuted on Disney+ last month may have provided a last-minute boost.
In any case, it’s fair to say that while Disney superfans needed no convincing to sign up, reaching its next 100 million subscribers will be a lot harder.
Analysts are largely optimistic that Disney shares have further to rise as its all-important theme-park and vacation business stages a quick recovery from the pandemic. Even so, it’s becoming evident that in streaming, Netflix is more of a stronghold than some might have thought and its market share won’t be so easily pilfered — not even by the Magic Kingdom.
While last year’s lockdowns led to a surge in new users, Netflix’s US growth is slowing again. In a less
worrying sign, though,
a Bloomberg Intelligence analysis of Sensor Tower data suggests that global
demand for the app is moderating to still-healthy pre-pandemic levels, with the number of downloads
during May and June beginning to show an improvement from March and April, when they had suffered a more meaningful drop amid reopenings.
Retaining its more than 200 million subscribers will be the most important gauge going forward. It’s plausible that some of Netflix’s toughest competition domestically will come not from Disney, but from Apple TV+ and Amazon Prime Video.

—Bloomberg