This week, Disney made its foray into streaming with a new platform, Disney Plus, that offers viewers the entertainment giant’s trove of original content for a $7 monthly subscription rate.
Aija Leiponen, professor of applied economics at the Cornell SC Johnson College of Business, says that Disney Plus further fragments an already packed market of streaming services.
“Disney’s entry into streaming is banking on some highly popular content to attract younger viewers, but at the same time it is further fragmenting the market. Several streaming services with distinct content libraries are now competing for attention, and it is increasingly difficult for viewers to find shows they enjoy.
“Recommendation engines only work within the library of the streaming service. Few households will subscribe to a large number of streaming services, so they will likely start jumping around enrolling and canceling services based on content recommendations by friends and critics. The market looks very unstable for the time being, and I expect significant consolidation in the next few years, because some or many of the platforms may fail to find stable audiences.”