Disney+ : Global Streaming Expansion Strategy

Executive Summary

Disney+ launched on November 12, 2019, in the United States, Canada, and the Netherlands, marking The Walt Disney Company's direct entry into the subscription video-on-demand (SVOD) streaming market. According to Disney's Q4 FY2019 earnings call, the service attracted 10 million sign-ups on its first day. By the end of Q1 FY2020 (fiscal quarter ending December 28, 2019), Disney+ had reached 26.5 million paid subscribers globally, as disclosed in the company's quarterly earnings report. The platform was designed to leverage Disney's extensive content library, including properties from Disney, Pixar, Marvel, Star Wars, and National Geographic. This case study examines Disney's global expansion strategy for Disney+ from its 2019 launch through 2024, focusing on market entry decisions, content localization approaches, pricing strategies, and competitive positioning, using only publicly disclosed information from Disney's investor relations materials, press releases, and verified media reports.

Company Background and Strategic Context

The Walt Disney Company, founded in 1923, had historically operated through theatrical releases, cable networks (including ESPN and Disney Channel), and licensing agreements with third-party streaming platforms. According to Disney's 2018 Annual Report, the company announced in August 2017 that it would end its distribution agreement with Netflix for subscription streaming of new Disney theatrical releases, setting the stage for its own direct-to-consumer strategy. In Disney's August 2017 earnings call, then-CEO Bob Iger stated that Disney would launch two streaming services: an ESPN-branded sports service (ESPN+, launched April 2018) and a Disney-branded entertainment service. The company's 2019 acquisition of 21st Century Fox's entertainment assets, completed on March 20, 2019, for approximately $71.3 billion (as disclosed in Disney's Q2 FY2019 earnings), provided additional content and a controlling stake in Hulu, further strengthening Disney's direct-to-consumer portfolio.

Initial Launch Strategy and Market Entry

Phase 1: November 2019 - March 2020

Disney+ launched in the United States, Canada, and the Netherlands on November 12, 2019, priced at $6.99 per month in the U.S., according to Disney's September 2019 press release. The company offered a bundle option combining Disney+, Hulu (ad-supported), and ESPN+ for $12.99 per month, as announced in the same release. The service expanded to Australia, New Zealand, and Puerto Rico on November 19, 2019, followed by select European markets on March 24, 2020, including the United Kingdom, Ireland, France, Germany, Italy, Spain, Austria, and Switzerland, as confirmed in Disney's March 2020 press release. According to Disney's Q2 FY2020 earnings call (May 5, 2020), the service had reached 54.5 million paid subscribers globally by early May 2020.

Phase 2: 2020-2021

Disney+ launched in India on April 3, 2020, through the rebranding of Hotstar to Disney+ Hotstar, as announced in Disney's March 2020 press release. This represented a departure from Disney's greenfield launch approach in other markets. According to Disney's Q3 FY2020 earnings call, Disney+ Hotstar contributed significantly to overall subscriber growth, though the company noted that average revenue per user (ARPU) in the region was "significantly lower" than in other markets due to local market pricing, without disclosing specific figures. The service expanded to Latin America on November 17, 2020, launching in Argentina, Bolivia, Brazil, Chile, Colombia, Costa Rica, Ecuador, El Salvador, Guatemala, Honduras, Mexico, Nicaragua, Panama, Paraguay, Peru, Dominican Republic, Uruguay, and Venezuela, according to Disney's November 2020 press release. Pricing varied by market; in Brazil, for example, the service was priced at 27.90 Brazilian reals per month (approximately $5.20 USD at launch), as reported by Reuters on November 17, 2020. Disney+ launched in Singapore on February 23, 2021, and across multiple additional Asia-Pacific markets throughout 2021, including Malaysia, Thailand, Indonesia, Hong Kong, and Taiwan, as detailed in various Disney press releases throughout the year.

Phase 3: 2021

On February 23, 2021, Disney launched "Star" as a sixth content brand on Disney+ in international markets (excluding the United States), as announced in Disney's December 2020 investor presentation. Star brought more general entertainment content, including content from Disney Television Studios, FX, 20th Century Studios, and 20th Television, to Disney+ in markets where Hulu was not available. According to the same presentation, this expanded the content library on Disney+ internationally from approximately 500 film titles and 7,500 television episodes to over 600 film titles and 10,000+ television episodes in markets where Star launched. With the addition of Star, Disney increased pricing in several international markets. In the United Kingdom, for example, the monthly subscription price increased from £5.99 to £7.99, as reported by BBC News on February 23, 2021. In Australia, the price increased from AUD $8.99 to AUD $11.99, according to The Guardian Australia on February 23, 2021.

Phase 4: 2021-2024

Disney+ expanded to Eastern European markets, the Middle East, and additional African territories throughout 2021 and 2022. According to Disney's Q4 FY2021 earnings release (November 10, 2021), Disney+ had reached 118.1 million global paid subscribers. The service was available in over 60 countries and territories by this time, as stated in the same release. Disney+ reached its peak subscriber count of 164.2 million in Q3 FY2023 (fiscal quarter ending July 1, 2023), as disclosed in Disney's Q3 FY2023 earnings release. However, in Q4 FY2023, Disney reported a decline to 150.2 million subscribers, attributed primarily to subscriber losses in Disney+ Hotstar in India following the loss of digital streaming rights for Indian Premier League (IPL) cricket, as explained in Disney's Q4 FY2023 earnings call on November 8, 2023.

Content Strategy and Localization

Global Content Library

Disney's content strategy centered on leveraging its existing intellectual property across Disney, Pixar, Marvel, Star Wars, and National Geographic brands. According to Disney's November 2019 launch press release, Disney+ offered "more than 7,500 television episodes and 500 films" at launch in the U.S., including original series such as "The Mandalorian," which became a significant driver of subscriber interest. In Disney's April 2019 investor day presentation, the company announced plans to invest heavily in original content for Disney+, projecting annual content spending of approximately $1 billion on original content by fiscal 2020, growing to $2 billion by fiscal 2024. In Disney's December 2020 investor day presentation, the company significantly increased these projections, announcing plans for approximately 100 new titles per year across Disney+, Hulu, and Star by 2024, with content spending expected to reach between $8-9 billion annually across all direct-to-consumer services by fiscal 2024.

Regional Content Production

Disney pursued local content production strategies in key international markets. In Disney's December 2020 investor day, the company announced plans to produce over 50 local and regional originals for Disney+ and Star by 2023 across markets in Europe, Asia-Pacific, and Latin America.

Specific examples disclosed in public announcements include:

• Europe: In a January 2021 press release, Disney announced production of multiple European originals, including "The Bloody Diary" from Germany, "Wedding Season" from the UK, and "Balenciaga" from France and Spain.

  
  

• Asia-Pacific: According to a November 2021 press release, Disney announced original productions for the APAC region including "Moving" from South Korea (which later became one of the platform's most-watched international originals according to Disney's Q3 FY2023 earnings call), "Reasonable Doubt" from Australia, and several titles from Japan and Indonesia.

  
  

• Latin America: Disney announced in its December 2020 investor day multiple Latin American originals including "Entrelazados" from Argentina and "Malinche" from Mexico.

  
  

India-Specific Strategy

Disney+ Hotstar represented a unique strategic approach. According to Disney's Q2 FY2020 earnings call, Hotstar already had approximately 300 million monthly active users (though not all were paid subscribers) when Disney+ launched on the platform. The service maintained Hotstar's established strategy of combining Disney+ content with live sports (particularly cricket), local Indian content, and regional language programming. In Disney's Q1 FY2023 earnings call (February 8, 2023), CFO Christine McCarthy stated that Disney+ Hotstar's ARPU was "lower than $1 per month" on average, compared to approximately $6-7 per month in the U.S. market (calculated from disclosed subscriber numbers and revenue figures in the same earnings materials). This pricing reflected local market conditions and purchasing power.

Pricing Strategy and Evolution

Initial Pricing Approach

Disney adopted a penetration pricing strategy in most markets. The U.S. launch price of $6.99 per month was positioned significantly below Netflix's standard plan ($12.99/month at the time) and below several other streaming competitors, as reported by CNBC on November 12, 2019. According to Disney's Q1 FY2020 earnings call, the company's initial pricing was designed to "reach as many consumers as possible" and reflected a long-term view of profitability rather than immediate return on investment. Bob Iger stated in the same call that Disney+ would not be profitable until fiscal 2024.

Price Increases

Disney implemented its first U.S. price increase on March 26, 2021, raising the monthly subscription from $6.99 to $7.99, as announced in a February 2021 press release. The annual subscription price increased from $69.99 to $79.99.

Further price increases followed:

• December 8, 2022: U.S. monthly subscription increased to $10.99 (for ad-free tier), as announced in Disney's August 2022 press release. Simultaneously, Disney introduced an ad-supported tier at $7.99 per month.

  
  

• October 12, 2023: U.S. monthly ad-free subscription increased to $13.99, while the ad-supported tier remained at $7.99, according to Disney's August 2023 press release.

  
  

International markets saw similar price increases, though timing and magnitude varied by region. For example, in the UK, the monthly price increased from £7.99 to £10.99 for the ad-free tier by October 2023, as reported by The Guardian on August 9, 2023.

Bundle Strategy

The Disney Bundle (combining Disney+, Hulu, and ESPN+) remained a key component of Disney's U.S. strategy. According to Disney's Q1 FY2024 earnings call (February 7, 2024), "a significant portion" of Disney+ subscribers in the U.S. subscribed through bundle offerings, though the company did not disclose exact percentages.

Competitive Positioning and Market Dynamics

Competitive Landscape

Disney+ entered a market dominated by Netflix, which had approximately 167 million global subscribers at the end of 2019, according to Netflix's Q4 2019 earnings letter. Other competitors included Amazon Prime Video, which does not disclose separate subscriber numbers but was bundled with Amazon Prime's approximately 150 million members globally in 2019 according to Amazon's 2019 shareholder letter, and emerging services like Apple TV+ (launched November 2019) and HBO Max (launched May 2020). In Disney's December 2020 investor day, CEO Bob Chapek (who succeeded Bob Iger as CEO in February 2020) stated that Disney expected to reach 230-260 million Disney+ subscribers globally by the end of fiscal 2024, a significant increase from the previous guidance of 60-90 million subscribers.

Market Challenges and Adjustments

Password Sharing: In Disney's Q1 FY2024 earnings call (February 7, 2024), CEO Bob Iger announced that Disney would begin "actively working to address account sharing" in 2024, following Netflix's earlier implementation of password-sharing restrictions. The company did not disclose estimates of password-sharing prevalence on Disney+.

India Market Loss: The loss of IPL cricket streaming rights to Reliance Industries-owned Viacom18 for the 2023-2027 period (announced in June 2022 according to Reuters) significantly impacted Disney+ Hotstar. According to Disney's Q4 FY2023 earnings release, Disney+ Hotstar subscribers declined from approximately 61 million in Q3 FY2023 to approximately 38 million in Q4 FY2023. In the Q4 FY2023 earnings call, CFO Christine McCarthy attributed the decline directly to the conclusion of IPL cricket streaming.

Restructuring in India: On February 28, 2024, Disney announced a joint venture merging Star India (including Disney+ Hotstar) with Reliance Industries' Viacom18, as disclosed in both companies' press releases. Under the agreement, Reliance would hold a majority stake, with Disney retaining approximately 37% ownership. This strategic shift indicated Disney's reassessment of its standalone streaming strategy in India.

Profitability Focus: In Disney's Q3 FY2023 earnings call (August 9, 2023), Bob Iger announced a shift in strategy from subscriber growth to profitability, stating that Disney+ would achieve profitability by the end of fiscal 2024. This represented a significant strategic pivot from the platform's initial growth-focused approach.

Organizational Structure and Distribution

Distribution Partnerships

Disney established distribution partnerships in various markets. Publicly announced partnerships included:

• Pay TV Integration: Partnerships with Sky in Europe (announced in October 2019), allowing Sky Q customers to access Disney+ through their set-top boxes, as reported by Variety on October 31, 2019.

  
  

• Telecommunications Partnerships: Agreements with Verizon in the U.S. (offering Disney+ free for one year to eligible customers, announced November 2019), Deutsche Telekom in Germany (announced March 2020), and various other regional

  telecommunications providers, as disclosed in respective company press releases.

  
  

• Device Manufacturers: Launch-day support on major platforms including Apple devices, Android, Roku, Amazon Fire TV, PlayStation, Xbox, and major smart TV manufacturers, as listed in Disney's November 2019 launch press release.

  
  

Strategic Adjustments and Evolution

Content Cost Management

In response to profitability pressures, Disney announced content spending reductions. In Disney's Q1 FY2023 earnings call (February 8, 2023), Bob Iger (who returned as CEO in November 2022) announced plans to reduce content spending by approximately $3 billion compared to previous projections, affecting both streaming and linear networks. The company also implemented content removal strategies. In May 2023, Disney removed dozens of titles from Disney+ and Hulu to reduce residual payment obligations, as reported by Variety on May 26, 2023. This included both licensed and original content.

Linear Integration Strategy

Disney announced plans for a streaming service combining Disney+, Hulu, and ESPN content in one application for U.S. subscribers. In Disney's Q2 FY2024 earnings call (May 7, 2024), the company announced the launch of a beta version of this combined experience, allowing bundle subscribers to access content from all three services within a single app interface.

International Joint Ventures and Partnerships

Beyond the India restructuring, Disney pursued alternative market strategies in some regions. In Latin America, Disney operated Star+ as a separate service (launched in August 2021) combining general entertainment and sports content, as announced in Disney's June 2021 press release. However, in June 2024, Disney announced plans to merge Star+ content into Disney+ in Latin America, consolidating to a single platform, according to Disney's June 2024 press release.

Limitations

1. Profitability Pressure in International Markets

Despite rapid subscriber growth, Disney+ faced sustained operating losses in several international markets due to high content investment, localization costs, and platform infrastructure expenses. Scale did not immediately translate into profitability, particularly outside North America.

2. Dependence on Local Partnerships

In markets like India, Disney+ relied heavily on local partners (e.g., Hotstar) for distribution and pricing reach. While this accelerated market entry, it reduced Disney’s direct control over pricing strategy, customer data, and platform positioning.

3. Rising Content and Localization Costs

Global expansion required heavy investment in regional originals and dubbing/subtitling to remain competitive against local and global rivals. This increased fixed costs and extended the break-even timeline in emerging markets.

Key Strategic Lessons

Lesson 1: Brand Equity Enables Rapid Market Entry but Requires Sustained Investment

Disney leveraged its globally recognized brand portfolio to achieve exceptional initial adoption. The 10 million sign-ups on launch day and 26.5 million subscribers within two months demonstrated the power of established intellectual property in consumer streaming markets. However, Disney's disclosure in its Q1 FY2023 earnings call that the streaming business would not achieve profitability until fiscal 2024—nearly five years after launch—illustrates that brand recognition, while facilitating market entry, does not eliminate the substantial capital requirements of building a global streaming infrastructure and content pipeline. The significant increase in projected content spending announced in Disney's December 2020 investor day (from $1 billion annually to $2-3 billion for Disney+ alone, and $8-9 billion across all services) reflects the competitive reality that sustained subscriber engagement requires continuous content investment beyond the initial library launch. Disney's subsequent content spending reductions announced in 2023, following streaming losses exceeding $10 billion over three fiscal years, demonstrate the challenge of balancing growth investment with path to profitability.

Lesson 2: Global Pricing Strategy Must Balance

Disney's pricing evolution reveals the tension between aggressive market penetration and revenue generation. The initial $6.99 U.S. pricing—approximately 46% below Netflix's standard tier at launch—successfully drove adoption but created challenges as the company pivoted toward profitability. The 99% price increase to $13.99 for the ad-free tier over four years (from November 2019 to October 2023) represented one of the steepest pricing trajectories among major streaming services, as documented in the respective Disney press releases. The dramatically lower pricing in markets like India (sub-$1 monthly ARPU disclosed in Disney's Q1 FY2023 earnings call) illustrates the complexity of global pricing optimization. While these prices enabled scale—Disney+ Hotstar reached 61 million subscribers by Q3 FY2023—the subsequent rapid decline to 38 million subscribers in Q4 FY2023 following the loss of IPL cricket rights, and Disney's eventual decision to form a joint venture with Reliance rather than continuing standalone operations, suggests that subscriber scale at very low price points may not create sustainable competitive positioning when content costs remain globally standardized or when key content assets are lost.

Lesson 3: Market-Specific Content Rights

The Disney+ Hotstar experience demonstrates how local content rights can override global brand advantages. Despite Disney's unparalleled portfolio of global franchises, the loss of IPL cricket streaming rights resulted in a 38% subscriber decline in a single quarter in India, as disclosed in Disney's Q4 FY2023 earnings. This underscores that in markets where specific content genres (sports, local entertainment, regional productions) drive subscriber behavior, global content libraries may be insufficient for market leadership.

Disney's response—announcing a joint venture with Reliance Industries on February 28, 2024, after losing IPL rights—represents a strategic recognition that maintaining position in certain markets may require partnerships or restructuring rather than organic competition. This contrasts with Disney's approach in markets like North America, Europe, and Latin America, where the company maintained wholly-owned operations and relied primarily on its own content portfolio. No verified information is publicly available regarding Disney's internal strategic analysis that led to different market approaches, but the divergent outcomes suggest that streaming platforms must assess content rights landscapes and competitive dynamics market by market rather than assuming uniform global strategies.

Discussion Questions

1. Strategic Pivot Analysis: Disney shifted from projecting 230-260 million Disney+ subscribers by end of fiscal 2024 (December 2020 investor day guidance) to achieving approximately 150 million core subscribers while focusing on profitability (Q4 FY2024 results). Evaluate the factors that necessitated this strategic pivot. Should Disney have prioritized profitability earlier in its streaming strategy, or was the growth-first approach necessary to establish competitive position? What alternative strategic paths might have balanced growth and profitability differently? Consider the competitive implications of Disney's choices against Netflix, Amazon, and newer entrants.

   
   

2. India Market Strategy and Joint Venture Decision: Disney+ Hotstar achieved 61 million subscribers in Q3 FY2023 but declined to 38 million in Q4 FY2023 following the loss of IPL cricket rights, leading to the announced Reliance joint venture in February 2024. Analyze whether Disney should have pursued the IPL rights more aggressively (reportedly awarded to Viacom18/Reliance) or whether the joint venture approach was strategically superior to continued standalone competition. What does this case reveal about the sustainability of streaming businesses built primarily on sports rights in price-sensitive markets? How should global streaming platforms assess when to compete independently versus when to partner or exit in specific markets?

   
   

3. Pricing Strategy Evolution and Subscriber Value: Disney increased U.S. pricing from $6.99 to $13.99 (99% increase) for its ad-free tier between November 2019 and October 2023 while simultaneously introducing an ad-supported tier at $7.99. Evaluate this pricing strategy progression. Did Disney's initial penetration pricing create unsustainable customer expectations? How should streaming services balance the trade-off between subscriber scale and revenue per subscriber? Analyze the introduction of advertising-supported tiers as both a pricing strategy and a business model evolution. Consider whether Disney's pricing trajectory was optimal or whether alternative approaches (higher initial pricing, slower increases, different ad-tier positioning) would have yielded better out.

Conclusion

Disney+’s global expansion shows how strong content IP, localized strategies, and strategic partnerships can drive rapid international growth. By adapting pricing and distribution to different markets, the platform scaled quickly in a competitive streaming landscape. However, this growth came with challenges, including high content costs, regulatory complexity, and ongoing pressure on profitability. The case highlights that long-term success in global streaming depends not just on expansion speed, but on balancing scale with sustainable economics and operational control.