ESPN+ passes 2M subscribers less than a year after launch

ESPN+ runs atop the BAMTech platform, which will also be used to build the upcoming Disney+ service. (Disney/ESPN)

Disney is reporting big growth for its ESPN+ streaming service. Less than one year after its launch, the service now has more than 2 million subscribers.

ESPN+ launched in April 2018, and by September the company said it already had more than 1 million subscribers. But now the service has passed 2 million and Disney gave a lot of credit to ESPN’s recent five-year agreement with UFC. The company said that its first UFC fight night got more than 600,000 people to sign up for ESPN+.

“We expect the expansion of combat sports content on the streaming service to drive continued growth in the months ahead,” said Disney CEO Bob Iger during the earnings call. “ESPN+ operates on BAMTech's platform, which has proved to be reliably stable during peak live streaming consumption and easily handled the volume of more than 0.5 million people signing up in a single 24-hour period.”

Iger said that the BAMTech platform, which will also be used to build the upcoming Disney+ streaming service, has helped ESPN+ deliver reliable streams, user interface and the ability to handle massive amounts of sign-ups in a short amount of time.

He also praised what he called ESPN+’s strong price to value relationship and ability to market on its traditional channels, two things he said would carry over to the Disney+ launch happening near the end of 2019.

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Disney has a lot riding on the success of Disney+, and the company will be holding an event in April to give analysts and investors an early look at the service. CFO Christine McCarthy said that Disney’s decision to pull back on licensing its content to third-party platforms like Netflix will have a negative $150 million impact on operating income in 2019.

Disney said that the upcoming film “Captain Marvel” will be the first Disney film that doesn’t end up on Netflix. That movie and all other Disney, Star Wars, Pixar and Marvel films going forward will head to Disney+ along with several original series and films. The company said the long-term strategy for Disney+ content will be heavily weighted toward internally sourced series and films.

But since the 21st Century Fox deal hasn’t closed yet and Disney can’t access the content its buying from National Geographic, Searchlight and other Fox properties, it’s doing deals early on with studios like CBS to fill out Disney+’s launch lineup.

After the Fox deal closes, Disney will also become the majority owner of Hulu. Hulu has been rapidly growing its subscriber base (it added 8 million subscribers in 2018) but has still been a money loser for its owners—AT&T, Comcast and Fox along with Disney. Iger said that the long-term goal for Hulu is to generate a profit.

“We’re not going to say how long that might take. That could shift a bit because at some point we’ll look more aggressively at some international rollouts of Hulu,” Iger said.