Disney should count its cricket loss


Disney lost the streaming rights to the 2023-2027 Indian Premier League cricket matches but said it would retain the broadcast rights.


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For Disney,

DIS 1.70%

Losing the streaming rights to India’s most popular cricket league could prove to be a blessing in disguise – provided the company takes full advantage of it.

The entertainment giant said on Tuesday it would retain the broadcasting rights to the Indian Premier League cricket seasons from 2023 to 2027. But Disney lost the streaming rights to those games after being outbid by joint venture Viacom18, which is partly owned by rival Paramount Global.


The winning bid for just the streaming portion was $2.6 billion — 18% above what the combined streaming and broadcast package fetched at the last auction in 2017. Disney acquired the rights to this business with its 2019 acquisition of the film and television business from 21st Century Fox.

Disney cited “the price it takes to secure this package” as the reason viewers have not brought home the streaming rights to one of the world’s top sports leagues – the one featuring the NFL and English Premier League football competes. However, the loss raises questions about whether the company can still meet the ambitious subscriber goal it set for its flagship streaming service Disney+ in late 2020.

The high end of that goal — 260 million paid subscribers by the end of fiscal 2024 — beats what Wall Street currently expects for leading streaming provider Netflix’s subscriber base at this point. When it issued that guidance, Disney noted that subscribers to its Hotstar service in India are expected to account for between 30% and 40% of Disney+’s subscriber base by the end of fiscal 2024.

But Hotstar viewers are far less lucrative, with average revenue per subscriber being about 12% of what Disney+ subscribers pay in the U.S. and Canada. And many seem to be primarily drawn to the games of the IPL; A late start to the league’s games last year coincided with the lowest number of Disney+ subscriber additions recorded for the September quarter. Disney Chief Executive Bob Chapek said at an investment conference last year that subscriptions in India don’t have auto-renewal, “so every time you lose that cohort, you have to get that cohort back.”

Mr. Chapek has since claimed Disney can still hit its streaming goal without the IPL deal. But the streaming market — and investors’ perception of it — has changed significantly since the company first set this goal. Most notably, a disastrous first-quarter report from Netflix in mid-April showed the streaming giant losing subscribers for the first time in more than a decade. That raised the question of whether streaming services face a natural cap in the most lucrative markets like the U.S., where 85% of the population now has broadband access, according to market research firm Aluma Insights. According to FactSet, analysts have reduced their subscriber targets for Netflix by an average of 9% through year-end 2024 since the company’s report.

Disney could use the loss in India to reset its own streaming target to more reasonable levels. That could save the company some embarrassment down the road — especially when its ambitious content pipeline of expensive Star Wars and Marvel shows begins to tail off. The move away from the IPL deal shows that Disney isn’t willing to pay any price just to keep up its subscription numbers. With investors now more intent on achieving profitability than growth at any cost, the mouse house can at least read the room.

The launch of Disney+ has added a little magic to a company whose shares took a nosedive after the coronavirus shut down theme parks and movie theaters. WSJ explains how Disney’s streaming platform has become a top contender in an already crowded field. Photo illustration: Jacob Reynolds/WSJ

write to Dan Gallagher at

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