Seema Shah · August 2023
Small Screen: Disney is facing challenges
Disney is facing challenges with a potential sale of ESPN, declining park attendance, box office failures, and a talent strike. However, Sensor Tower data suggests that Disney+ is experiencing solid single-digit growth in monthly active users, outperforming competitors like Netflix, Peacock, Paramount+, and Prime Video. ESPN's limited content has led to stagnant user growth and decreased engagement. Disney's Indian streaming service, Hotstar, has also seen a decline in subscribers due to a lack of streaming rights for the Indian Premier League. On the other hand, Warner Brothers Discovery's Max streaming service has shown increased engagement according to Sensor Tower data.
Key Takeaways:
A rumored potential sale of a stake in ESPN, falling park attendance, box office bombs, and an ongoing talent strike are all headwinds swirling around Disney’s upcoming 3Q FY23 earnings. However, Sensor Tower data points to solid, single-digit QoQ growth in Disney+ (incl. Star+) MAUs (+3%), besting Netflix (-4% QoQ), Peacock (-4% QoQ) Paramount+ (-8% QoQ), and Prime Video (flat QoQ)
ESPN currently offers a premium subscription in the form of ESPN+, but this service is severely limited in content due to the heavily scattered nature of sports streaming rights. This lack of content has likely contributed to stagnant mobile app user growth and falling engagement: 2Q23 MAUs and weekly average time spent on ESPN were flat YoY and down 8% YoY, respectively
Disney’s Indian streaming offering, Hotstar, continued to plague the broader company’s subscriber growth with 2Q23 MAUs down -15% QoQ (-18% YoY) as the service contended with a lack of streaming rights to the popular Indian Premier League (which historically starts in 2Q)
Although Warner Brothers Discovery missed on 2Q23 street estimates, ST data showed engagement gains on its new Max streaming service that were inline with company commentary on strengthening engagement: per ST, Max time spent (+6%) and sessions (+2%) were up single-digits MoM in Jul’23
For more information, request the full report from reports@sensortower.com.
