There has been little question that Walt Disney (DIS) had the potential to change the streaming video landscape with the debut of Disney+ a little more than a year ago. With early-bird signups, the company had amassed 10 million viewers by the end of the first day of availability and shocked investors when the service hit its 2024 subscriber goals by roughly the end of its first year in business.
During its investor day in December 2020, the company said it now expects subscribers in a range of 230 million to 260 million by the end of 2024, with its Disney Hotstar service representing between 30% and 40% of total viewers. One analyst has gone even further, saying Disney+ will surpass Netflix (NFLX -0.38%) in terms of subscribers to take the streaming crown by 2026.
Simon Murray, principal analyst at Digital TV Research (DTVR), estimates that global subscribers of Disney+ will reach 294 million by 2026, surpassing Netflix with 286 million. However, DTVR's new subscription video on demand (SVOD) platforms forecast says the growth will largely be courtesy of India, where Disney will absolutely dominate the competition, with 98 million subscribers, overwhelming the 13 million expected for Netflix.
Disney acquired Hotstar with other assets it purchased from Fox Corporation in 2019. At the time it came under Disney's wing, the ad-supported tier of Hotstar reached as many as 300 million monthly active users, giving the House of Mouse a large and growing base to mine for paying subscribers.
Not all the news is good, however. Because of India's lower cost of living, customers produce less than a third of subscription revenue generated by U.S. subscribers. According to DTVR's report, Disney+ Hotstar will account for just $2.62 billion, or 13% of the platform's estimated revenue, by 2026.