Subscription video-on-demand (SVOD) service providers have recorded rapid growth over the past five years, according to research from IBIS World.
As a result, revenue for the combined pay television and streaming service industry in Australia is expected to grow at an annualised 9% over the five years through 2019-20 to $5.6 billion.
However, the local entry of Disney+ on 19 November, which was announced this week, is expected to have a significant effect on providers such as Netflix, Stan and Amazon forcing them to produce new content to retain subscribers.
IBIS World states that with the likes of Star Wars, Pixar, Marvel franchise, Disney’s animated movies all part of the offering, consumers will likely have to subscribe to multiple streaming services to retain access to all their content.
Disney also has plans for several original series, including new series in the Star Wars and Marvel universe to attract consumers, which could place further pressure on SVOD services to up their content production output, as opposed to securing licensing deals.
The Disney+ service will also be priced at $8.99 a month, below the price of the standard of either Netflix or Stan’s base package.
“Rapid growth in the SVOD service market has intensified competition. New entrants are increasingly looking to differentiate themselves by providing exclusive content," IBIS World senior industry analyst Liam Harrison says.
"As a result, some large production companies that hold the licenses for popular television shows are looking to establish their own streaming services."
One such example is production company Warner Media, which has removed its popular sitcom Friends from Netflix to provide it exclusively on the company’s new streaming service HBO Max.
This is similar to Disney's local arrangements with Nine-owned streaming platform Stan, which signed a short-term content deal late last year.
Nine CEO Hugh Marks and Stan CEO Mike Sneesby have both downplayed the impact of Disney+ and its arrival in Australia, with neither stating that the launch would see the end of a relationship with the global content giant.
Other examples include The Walt Disney Company’s existing streaming provider Hulu and upcoming Disney+ streaming service.
These streaming services use Disney’s vast library of popular programs that it has either produced or to which it holds distribution rights. Examples include the Marvel franchise, and offer them exclusively on their platforms.
“As more companies seek to operate their own streaming services, the libraries of larger providers such as Netflix are expected to become increasingly compromised," Harrison says.
"This may make them more reliant on content produced in house. Consumers will no longer be able to subscribe to a single platform to access most of the programs they want to watch, and many will likely have to consider multiple subscriptions in the near future."
Disney+ has already been dubbed in market as the possible "Netflix Killer" as its recent deal to acquire 20th Century Fox shows the company has no intention of slowing down its content production plans.
This week it was also revealed that Disney was upping its on-ground presence in Australia, hiring for a raft of new roles spanning marketing, events and public relations.
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