Netflix vs. Disney vs. Apple TV: This Unlikely Content Could Beat Streaming Newcomers

Netflix Inc. plans to go from being one of the major distributors of Japanese anime titles to the biggest animation player in the United States. Put in another way, Netflix plans to out-Disney Disney -- but in streaming anime.

Netflix has streamed, is streaming or will stream 18 Japanese original anime series. These include Ultraman, Devilman Crybaby, Castlevania, A.I.C.O. -Incarnation -, Sword Gai: The Animation, Seis Manos, Baki, Knights of the Zodiac: Saint Seiya, Hero Mask, 7 SEEDS and Cannon Busters.

Although extremely popular, these titles will be hard pressed to hold their ground in streaming against The Walt Disney Company and its legendary cartoon characters beloved by most Americans when they debut on Nov. 12. Disney owns "The Avengers", "Star Wars", "The Simpsons" and "Toy Story," among many other popular franchises.

Netflix revealed it's developing a library of exclusive anime shows. It's entered into long-term partnerships with five of Japan’s most famous animation studios.

Netflix, which ruled streaming video when it started the service 10 years ago, is now faced by a horde of heavy-hitters offering cheaper subscription rates and quality programming starting 2020. Tech and media companies such as Apple, Amazon, NBC and WarnerMedia from AT&T are now cutting into Netflix's once hefty market by resorting to cheaper priced services.

In September, Apple said Apple TV Plus, its streaming TV service, will cost only $4.99 a month. Disney earlier said it will offer high definition streaming as part of its standard $6.99 plan for its new Disney+ service.

Netflix’s basic plan still stands at a much more expensive $8.99 per month. Netflix raised subscription prices from 13 percent to 18 percent in January. Unable to compete effectively in price, Netflix is turning to original anime content to save its day.

Netflix said it will broaden its strategy of paying for original content to encompass new animated shows such as "Ultraman" and "Eden." It suffered a serious setback in its quest to dominate U.S. anime when HBO Max grabbed the coveted U.S. distribution rights for most of Studio Ghibli anime shows, which are among the most beloved in Japan.

Despite this, Netflix still plans to stream Ghibli anime, including the Oscar-winning "Spirited Away" and "My Neighbor Totoro" in Japan and other countries. "Spirited Away," a fantasy adventure aired in 2001, won the Golden Bear in 2002 and the Academy Award for Best Animated Feature Film in 2003. "My Neighbor Totoro" is a 1988 Japanese animated fantasy film written and directed by Hayao Miyazaki and animated by Studio Ghibli.

Netflix is also in talks with Studio Ghibli to secure the up-for-grabs streaming rights for Japan, said John Derderian, Netflix’s director of Japan & Anime.

“Japan is certainly among the top two creators of stories in the world with Hollywood,” said Derderian.

Netflix has made deep inroads in Japan and has a subscriber base numbering in the millions. As part of its growth strategy, Netflix will expand in Japan and push deeper into Asia -- which is where most of Netflix’s anime viewers are located.

Overseas sales of Japanese animation content quadrupled to $10 billion since 2012, said Humanmedia Inc., a Tokyo-based research firm.

“Netflix will have to sustain investment into high-budget, Hollywood-like works and multinational content in order to set itself apart as other players join the market,” said Masahiro Hasegawa, an analyst at HumanMedia.