Even if Netflix (NASDAQ:NFLX) remains the strongest streaming company out there, there is truth to the argument that Disney’s (NYSE:DIS) own streaming venture has managed to become a decent competitor in less than a year.
First debuting in November 2019, Disney+ already had a rather extensive library of content, as well as an established fan base sprawling across a significant part of the globe. In a way, how wouldn’t it? After all, we are talking about the entertainment powerhouse that is Disney itself.
Unfortunately, things might not be playing out as expected as of late for investors, as Disney’s own CEO Bob Chapek recently shared two challenges that the streaming service is currently facing.
The rise of Disney+ in Latin America is going rather slow
For those unaware, Disney+ did not have a worldwide debut. In other words, many countries got to see the arrival of the platform several months later. However, Disney used this time to work on estimates for each nation that was yet to receive the service.
That being said, with Latin America having a population of roughly 617 million, Disney had more than enough reasons to believe that this might turn out to be a highly lucrative market. But once the service finally arrived, it only got to experience subscriber numbers going as high as 38.66 million.
On their own, these numbers are not bad at all. But compared to what they could be, this shows a relatively slow development for the streaming service. In a public statement, Chapek stated that the main reason for this is that Disney is having some trouble in finding partnerships that could speed up the process on the said territory.
Nonetheless, the CEO was still very confident about Disney+’s potential for getting back on track in the near future.
Disney+ might not keep that many subscribers in India by the end of the year
The second issue lies in Disney+’s performance in India. More specifically, in how the subscription service has to be carried out in said land.
In his statement, Chapek shared that the Indian streaming market tends to work with annual subscriptions. However, they present a unique challenge since the region does not allow auto-renewal services for any subscription.
The end of Disney+’s first year in India is coming near, and unlike how it is for other markets, there is no reassurance that the customers will be interested in making a renewal.
In response, Disney is looking to convince these customers to do so with extensive marketing campaigns. As expected, their success rates are yet to be seen, but the chances are that they might not work on a 100% basis.
Keep in mind, this segment of Disney+’s subscriber count amounts to 40% of it. Meaning the potential losses would be far from insignificant.
In the end, Disney’s CEO shared his personal opinions on the matter. Overall, he thinks that this would only be affecting Disney+’s short-term performance, with some volatility to its projected growth. Nonetheless, he also stated he felt that its long-term projections remain primarily unaffected.