The streaming-video battlefield is about to get some major new combatants — and fresh research suggests that Disney is best equipped to grab new territory.
Once Disney, WarnerMedia and NBCUniversal launch their direct-to-consumer services, customers’ perceived value of incumbent players Netflix, Hulu and Amazon Prime Video will drop significantly, according to a study conducted by Langston Co., a Denver-based behavioral consumer research and consulting firm, shared exclusively with Variety.
Disney Plus, which will include powerful brands that span Lucasfilm’s “Stars Wars,” Pixar and Marvel, is forecast to have a better price-to-content rating ratio than both WarnerMedia and NBCU, Langston’s research shows. The accompanying chart illustrates a before-and-after picture: Respondents were asked about their perceived value ratings for Netflix, Hulu and Amazon Prime prior to the media companies’ launches; then they rated the six services after being informed of the entertainment options coming to the new services — which includes proprietary content the media conglomerates had licensed to Netflix (like “Friends,” which is heading to WarnerMedia’s HBO Max, and “The Office,” to be exclusively streamed on NBCU’s offering).
Even with new rivals, Netflix is expected to enjoy the best value ranking. In the chart, services in the bottom-left quadrant have lower overall ratings than those in the upper right.
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However, as with any research, there are caveats. For starters, the consumer reactions the Langston study measured were based on hypothetical, not actual, behavior. Another issue: Pricing for HBO Max and NBCU’s service isn’t known at this point, so researchers asked participants to assume each of the services were priced about the same — which will not be the case. Disney Plus will bow at an aggressive $7 monthly, versus Netflix’s $13-per-month standard HD plan. HBO Max is widely expected to cost more than the $15 baseline monthly price of HBO alone. The upshot: Disney’s overall value could be even better than Langston’s study predicts, while WarnerMedia’s could be worse.
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| Consumers rated the three major current services for value and content (amber squares), then those same services with the three expected new players (blue circles). Services at the upper-right quadrant rank highest; those at the bottom left lowest. Source: Langston Co. |
The study’s data is based on an online survey of 1,250 U.S. adults (24-54) from July 28 to Aug. 8, census-balanced to reflect national population by income, age and geography. The researchers focused on millennials and Gen Xers as the age groups most representative of purchasing decisions in the market.
The research has other gaps. It omitted Apple TV Plus, the tech giant’s streaming package expected to debut in November. The survey also didn’t gauge reaction to Disney’s plan to bundle Disney Plus, ESPN Plus and Hulu for a reduced price of $12.99 monthly. Given consumer frustration with the growing fragmentation of subscription streaming, the Disney triple play could prove enticing, says Langston Co. principal Spencer Imel. “Bundled services will likely do quite well,” he says. And on this front, “Disney is much further along than the other media companies.”
The full report from Langston Co., “Consumer Behavior & Expectations In Today’s Changing Media Landscape,” is available via this link.