Streaming is now dominated by a handful of companies. Market leader Netflix’s [NFLX] share price has gained circa 385% (as of 28 May’s close) as its subscriber numbers surge globally.
Amazon Prime Video has become ubiquitous, helped, in no small part, by being included with Prime delivery. While Disney+ has also piled on the subscribers numbers despite only being a few years old. Then there’s Hulu, HBO Max and Apple TV also competing for attention.
In such a crowded market, can new offering Struum meaningfully vie for attention by gathering together smaller streamers on one platform?
How Struum is shaking up streaming
Beyond the major streamers like Netflix are over 250 specialist services, which Strumm is hoping to aggregate on its platform.
Struum works like ClassPass, allowing users to watch content from a range of different providers with one subscription. Subscribers pay a $4.99 monthly fee, which gives them credits to use sampling different content on the platform. If a user regularly consumes content from one provider, then they can opt to subscribe to that provider's services from within Struum. At launch, there will be 25 partners on the service, which will grow over time.
Behind Struum is a team with industry pedigree. According to TechCrunch, former senior executives at Disney+ and Discovery Networks came up with the idea just before the outbreak of Covid-19. Providing the cash is a multimillion-dollar investment from former Disney supremo Michael Eisner through his Torante Company.
“We view ourselves as the ultimate complementary service and a perfect fit for TV and film lovers who are increasingly frustrated by the costs, complexity and effort required to discover and watch what they want” - Struum CEO Lauren DeViller
“We view ourselves as the ultimate complementary service and a perfect fit for TV and film lovers who are increasingly frustrated by the costs, complexity and effort required to discover and watch what they want,” said Struum CEO Lauren DeViller.
Netflix share price dips on competition fears
The arrival of Struum signals yet more competition for Netflix. Netflix’s share price is down 7% this year. And while the fall is in part due to the wider tech sell off, losing market share can’t have helped.
Netflix maintained its number one position as the top streamer last year, with 20% of the market in the US, according to data from Ampere Research. In second place was Amazon Prime with a 16% market share, followed by Hula with a 13% share. HBO Max was in fourth spot with a 12% market share, and Disney Plus took fifth with a market 11%. The rest of the market, which included Apple TV and Starz, represented a 28% share.
However, while Netflix was once again the top streamer in the US, its share had actually fallen year-on-year. And by 2024, the analysts at Ampere reckon that Netflix will lose its crown to Disney+.
Driving Disney+’s success has been branded content like Star Wars spin-off The Mandalorian, Marvel's WanderVision, and the huge library of kid-friendly movies like Frozen II. In March, Disney announced that its streaming platform had notched up over 100m subscribers since launching in 2019 - a number that took Netflix a decade to accomplish. By the end of 2024, Ampere forecasts Disney+ to have 295m subscribers, versus Netflix’s 279m.
“Disney+ has obviously experienced some of the fastest growth seen from a subscription video-on-demand service; kudos to them for establishing themselves as a global force so fast. While Disney+ is still only half the size of Netflix, it has reached that milestone in an unprecedented timescale” - ichard Broughton, Ampere Analysis analyst
“Disney+ has obviously experienced some of the fastest growth seen from a subscription video-on-demand service; kudos to them for establishing themselves as a global force so fast. While Disney+ is still only half the size of Netflix, it has reached that milestone in an unprecedented timescale,” said Richard Broughton, an analyst at Ampere Analysis.
Where does this leave Netflix’s share price? Well, analysts on Yahoo Finance have a $613.91 average price target, which would see a 22.1% upside on Friday’s closing price. Competition from Struum might not stop Netflix hitting that target, but Disney+ could prove a stiffer challenge.
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