Why Disney Is Going Over-the-Top With Sports Streaming
Disney (NYSE: DIS) ruffled a few feathers earlier this month when the magical media empire announced it would be splitting ties with Netflix (NASDAQ: NFLX) for content distribution. Disney revealed that it plans to make its movies and TV shows publicly available through a new "over-the-top" (OTT) digital-streaming solution. OTT is basically any sort of streamed media that doesn't require a cable company to distribute it -- essentially every internet streaming service is an OTT. It intends to discontinue its distribution agreement with Netflix and launch its new site beginning in 2019.
On top of that, Disney also announced that it plans to open up its ESPN sports content to the public next year. Sports fans will no longer need to have a pricey cable subscription to watch their favorite games.
Why is Disney doing this? The reason is because the company's golden goose has stopped laying golden eggs. It's now relying on innovation to keep its lucrative profit stream in place. While this has a fair share of uncertainty, it could potentially turn out to be a good long-term move.
Source: Fool.com
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