Disney has decided to end its distribution agreement with Netflix in 2019 and instead launch its own streaming service.
The company says that its new streaming service would be built off technology from the Major League Baseball founded video streaming platform BAMTech. Disney was already a major investor in BAMTech but will now pay an additional $1.58 billion for a total 75 percent stake in the company.
“This acquisition and the launch of our direct-to-consumer services mark an entirely new growth strategy for the company, one that takes advantage of the incredible opportunity that changing technology provides us to leverage the strength of our great brands,” Disney CEO Bob Iger said in a statement.
Meanwhile, Disney would also be launching a separate ESPN-branded streaming service that promises ‘10,000 live regional, national, and international games and events a year,’ with individual sports packages available as well.
The Netflix distribution deal will end in 2018 and Disney’s new streaming service will kick off in 2019 with a slate of theatrical releases like ‘Toy Story 4,’ ‘Frozen’ sequel and Disney’s CGI animated remake of ‘The Lion King.’ Disney also announced that it will be making a “significant investment” in exclusive movies and television series for the new platform.
Just this week, Netflix announced the acquisition of comic book publisher Millarworldthat’s already seen successful film adaptations. In light of today’s announcement, the loss of Disney films would be a huge loss for Netflix subscribers and will make it harder for Netflix to find new ones.