Netflix Inc. lost as much as US$8 billion ($11.8b) in market capitalization in a few minutes of trading on Walt Disney Co.'s news of its upcoming - and cheaper - rival streaming service.
Disney unveiled details of the service on Thursday (US time) after the close, saying it would launch November 12 at a price of US$7 a month, or US$70 a year. That undercuts Netflix, whose most popular US plan costs about US$11 a month.
Netflix shares fell as much as 5 per cent to US$349.36 shortly after the open in New York Friday, sending its market as low as US$152.5b.
Analysts have been sanguine about Netflix's rising subscription prices, which haven't seriously dented its 60 million-strong US customer base. Still, the company has rarely faced a challenge like the deep-pocketed Disney, which is willing to lose money for years on Disney+ as it moves to grab market share.
Disney went the opposite way. Its shares jumped to a record high, adding as much as US$25b in market value, for a total of about US$235b.
