Disney took a few bold steps into the future yesterday, announcing plans for two new streaming services, and a new licensing arrangement with Netflix.
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The company, which has seen its profits shrink due to ESPN’s declining pay TV subscriptions, said it will launch a standalone ESPN-branded streaming service in 2018. The channel will include live broadcasts of professional sports such as Major League Baseball, the National Hockey League, Major League Soccer and tennis.
While the streaming service will likely not include some signature ESPN shows such as SportsCenter, it will feature subscription programming from MLB.TV and NHL.TV.
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Disney said the ESPN online channel will be available to purchase without a pay TV subscription, but pay TV subscribers will be able to access it using their passwords and user name authentications.
The company also revealed it will launch a standalone Disney-branded streaming channel in 2019 that will feature movies and shows from the Disney Channel, Disney Junior and other Disney networks.
As part of that effort, Disney will end its distribution agreement with Netflix for streaming of new movie releases, beginning in 2019.
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The two moves are a clear response from Disney regarding its somewhat wobbly relationship with the pay TV industry. Over the last few years, several pay TV operators have launched smaller, less expensive programming bundles which do not include ESPN, which has contributed to ESPN’s smaller subscription base.
By offering an ESPN channel directly to consumers, Disney can bypass the pay TV operators and possibly generate additional income.
— Phillip Swann