The move could fill a hole that other streaming services spent the past few years scrambling to fill - a lack of high-quality, family-friendly programming on a kid-friendly service.
Over the years, networks and streaming services such as HBO, Netflix, Amazon Prime Video and Hulu often created shows for adults, many of which showed graphic scenes of sex, nudity and violence. These shows left children wanting, so in the second decade of the 2000s, the companies turned their eyes to children's programming, an underserved but growing market.
Even so, the other companies have always been playing catch-up to Disney.
Research firm eMarketer found that digital video consumption among children 11 and under in the United States is expected to jump from to 74 percent in 2019 from 68 percent in 2013, the Los Angeles Times reported. It added, "At stake will be millions of dollars in subscription fees for streaming services that have the best offerings."
If so, Disney's new service will launch when there are more young viewers using streaming services than ever before.
That shift from traditional television to streaming services among children already appears to be occurring. As the New York Times reported, Nielsen found children between 2 and 11 watched two fewer hours of live television in 2016 than they did in 2015.
Disney television has been hit particularly hard, which may have provided motivation for creating a streaming service. The Disney Channel suffered a 28 percent drop in live-plus-seven-day prime time United States viewers during the 2016 to 2017 season, according to Quartz.
The streaming giants are also attracted to young viewers because children watch television differently than adults, in a manner better suited to the control streaming offers. Kids are "natural binge-watchers, prone to viewing the same episode over and over," the Los Angeles Times reported, and they aren't as beholden to traditional storytelling.
"What's great about streaming services is kids aren't tied to the linear broadcast," Tara Sorensen, head of the kid's content division at Amazon Studios told the Los Angeles Times. "We can encourage them to stop shows or rewind. Streaming and kids just makes perfect sense because we really put them in the driver's seat."
To that end, Netflix began offering limited children's content in 2011, the Los Angeles Times reported. Twenty percent of its content was for young viewers by 2014, according to data from analyst firm SNL Kagan.
This pivot proved successful. Erik Barmack, Netflix's vice president of global independent content, told the Los Angeles Times that in 2015, half of its U.S. subscribers watched children's content each week.
Playing catch-up, HBO made a headline-generating, five-year deal with Sesame Workshop in 2015 to exclusively air first-run episodes of "Sesame Street."
The next year, Amazon Prime Video cut a deal with PBS to exclusively stream most of the broadcaster's children's shows in what the New York Times called its "latest move in a battle among the streaming giants, along with HBO, to acquire or create as many children's television shows as possible."
Disney, though, won't need to catch up. It comes equipped with a deep bench of movies and television shows aimed at young viewers, arguably some of the most popular children's programming ever made, to boot.
Numbers aside, there anecdotally seems to be a hunger for a streaming service focused primarily on family-friendly fare. Throw a stone at any parenting blog, and you're sure to hit a post with a title like "Children and streaming don't always mix" or "My bi-annual rant about Netflix parental controls."
"It's not like network TV anymore, where you can put on Cartoon Network and know you're safe," Common Sense Media parenting editor Caroline Knorr told the Deseret News.
"Watch with your kids when you can and check out what's recently watched on Netflix. If you have a DVR, record shows you're OK with and let your kids watch those."
But the Disney streaming service could well be the answer to these cries - no workarounds needed. It would be the first major streaming service directed at children, rather than being a service for adults with a section aimed at youngsters.
It's unclear exactly how much Disney's announcement will affect the other services in the long run. But on Tuesday, Netflix shares dropped nearly 5 percent, before slightly rebounding.
"Kids' content is evergreen and they watch the same movies over and over," Peter Csathy, founder of the advisory firm CreaTV Media, told the Los Angeles Times. "And there is a very high percentage of kids viewing to these digital platforms. Losing that content will have a meaningful impact on Netflix."
