Royal Assets - The Corp. may be able to strengthen its market position, but will customers revolt?

NORTH BRIDGE ROAD, Singapore - March 21, 2023 - PRLog -- DIS has developed and altered with the times, and its successful push into the streaming-video business exemplifies this.

In just three years, Disney+ has grown from a fledgling startup to an industry giant, with over 164 million users worldwide. With an additional 43 million Hulu members, DIS's 207 million subscribers are within striking distance of the market leader, Netflix Inc. (NFLX), which has 223 million. Investors anticipate that DIS will surpass NFLX's subscriber base in the coming years.

However, recent events and Wall Street pressure may force the company to take one of the biggest risks in its long and illustrious history – a move that could easily backfire, delaying the company's progress by years.

Hulu is under DIS's operational control, and the streaming service's remaining 33% ownership is likely to be acquired by DIS in approximately a year. According to the terms of a 2019 agreement, DIS can consummate the acquisition as early as January 2024. Each streaming site has its own set of popular titles, but when all of them are combined, the roster is unequalled.

Viewer data appears to support that viewpoint. According to statistics provided by Ampere Analysis, the combination of Disney+ and Hulu commands 30% of the Top 100 shows on U.S. streaming subscription services so far this year. In comparison, NFLX, the individual leader, controls 23%.

According to many media sources, the business is considering combining Disney+ and Hulu into a single streaming powerhouse. While a combination may appear to be a smart option at first sight, the perspective is myopic and overlooks a key issue.

There would undoubtedly be additional advantages to such a union. The firm would be able to profit on the popularity of the two services by offering a wider library while simultaneously saving money by focusing on a narrower line-up of the most popular titles.

The streaming business has been challenged by a heightened concentration on revenues in the middle of the economic slump. DIS isn't immune, however, citing a $1.47 billion operating loss in its direct-to-consumer (DTC) unit for the fiscal fourth quarter. As a result, the segment's losses for the year were more than $4 billion. However, previous CEO Bob Chapek stated on the company's most recent earnings conference, "We still expect Disney+ to become profitable in fiscal 2024."

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