After years of friction over the direction of its direct-to-consumer strategy, Disney has just claimed major bragging rights with ESPN’s announcement that streaming service ESPN+ has reached 1 million subscribers in its first five months.
The legacy sports giant’s $5-a-month streaming service debuted in April, ending speculation about how ESPN planned to address the decline in its traditional video subscriber numbers. The erosion of subscribers dinged Disney’s stock and became a key point of focus for analysts tracking the company.
ESPN+, which features Major League Baseball as well as college sports, boxing, soccer and the UFC, is the first of Disney’s direct-to-consumer offerings planned in the coming months. The general entertainment offering, which will include original movies and series as well as titled pulled off of Netflix, is slated to launch by the end of 2019. The drive to own content that can power streaming services capable of competing with Netflix and other rivals is the main reason the company is paying $71.3 billion to acquire most of 21st Century Fox. The merger is expected to close in the first half of 2019, though it has cleared most major hurdles and could be wrapped up even sooner.
“Reaching one million paid subscribers is an important milestone for any video subscription service, but reaching this benchmark in such a short amount of time is an incredible testament to the teams from DTCI and ESPN who have worked tirelessly to bring this product to market and continually improve it since our April launch,” said Kevin Mayer, Disney’s chairman of Direct-to-Consumer and International. “We’re thrilled so many sports fans have quickly come to love the service. The future is bright and we believe growth will continue as we add features, distribution partners and more exclusive content in the coming months.”
Jimmy Pitaro, who succeeded John Skipper as president of ESPN earlier this year and is also co-chair of Disney Media Networks, said the milestone is just the beginning. “Combining sports, technology and the ESPN brand is a very powerful combination, and we are just getting started,” he said. “Very quickly, a wide range of sports fans have seen the value of ESPN+. With high quality programming and an outstanding user experience, ESPN and DTCI are expanding the ways Disney is serving sports fans.”