Disney (and others) at the Box Office - Current State of Affairs

[Wendy Pleakley]

Physical media sales was the icing on the cake for productions. Of course, the age of DTC killed that. But ask yourself this question, with the streaming rights going to Disney, from Disney, which is already likely been pre-negotiated, does that really mean anything for the net profitability of the production?

Spoiler alert it doesn’t.

With very few exceptions, the revenue generation post theatrical release just doesn’t amount to anything. Even if it was $20 million, which would be on the high end, it still doesn’t change the movie at best Breaking even.

You have a source confirming movies make almost nothing post theatrical?

It's a myth that studios can just give themselves a sweetheart heal on streaming fees. Studios have been sued for doing this.

Regardless, if they did license the movie to D+ for cheap, then D+ would make more money off it. It all goes into the same pot at the end of the day.

 

[monothingie]

You have a source confirming movies make almost nothing post theatrical?

Like Yogurt wisely said, "Merchandising, It's where the real money from the picture is made."

Of course, the post theatrical revenue comes from Merchandising, DTC, and PVOD (iTunes, Youtube, Amazon, etc.) The digital replacement for physical media sales. Note this different from DTC streamers like D+ or Hulu.

However because the window between theaters and DTC for most productions is just a matter of weeks, no one really goes out and buys the digital copy, because days later it's available for "free" on their subscribed streaming service.

Now don't get me wrong, some streamers pay big $$$ for rights to stream tentpole franchises. But...that only applies to very small percentage of productions.

It's a myth that studios can just give themselves a sweetheart heal on streaming fees. Studios have been sued for doing this.

When The Walt Disney Company (Studios) licenses a movie to itself for DTC (D+), where does the money come from? The amount is irrelevant.

Left Pocket to Right Pocket.

Regardless, if they did license the movie to D+ for cheap, then D+ would make more money off it. It all goes into the same pot at the end of the day.

When Sony License a movie to Netflix for DTC, where does the money come from?

For Disney it comes from and goes back into the same pot at the end of the day. That's the problem.

 

[Sirwalterraleigh]

Yep…one skitz said “all movies make tons of money on stream!!!”…after they started tanking the box office…

And a handful now treat that as a proclamation of “science”…

I’d love to get the “source” verifying that.

It’s sub fees and low advertising revenue…fine to cover for some of the decline in real dollars from linear…but not enough to cover for tanking 90% of your movie releases year in and out.

Another stinker inbound this month…which looks like it may have a tough task handling the witches

 

[MisterPenguin]

When The Walt Disney Company (Studios) licenses a movie to itself for DTC (D+), where does the money come from?

Subscriptions and ads.

This isn't new information.

 

[Disney Irish]

When The Walt Disney Company (Studios) licenses a movie to itself for DTC (D+), where does the money come from? The amount is irrelevant.

Left Pocket to Right Pocket.


When Sony License a movie to Netflix for DTC, where does the money come from?

For Disney it comes from and goes back into the same pot at the end of the day. That's the problem.

Still don't know why this is so hard to grasp for some.

The money for content on DTC ultimately comes from the subs fees and now also ad sales. And so while D+ initially pays internally to license a movie from Studios, its ultimately the consumer who subs and watches ads on D+ that is covers the cost of that movie.

 

[monothingie]

Still don't know why this is so hard to grasp for some.

The money for content on DTC ultimately comes from the subs fees and now also ad sales. And so while D+ initially pays internally to license a movie from Studios, it’s ultimately the consumer who subs and watches ads on D+ that is covers the cost of that movie.

Now follow me here… because I know this is hard for you to grasp.

When Disney licenses something to itself, who takes on the overhead associated with their own streaming service?

Whereas when Sony licenses is something to Netflix, who takes on the overhead for Netflix? It’s not Sony.

 

[monothingie]

Subscriptions and ads.

This isn't new information.

Yes, and with that come the expenses associated with that. It’s the harsh truth and why streaming for companies like Disney have not duplicated the wild success of Netflix. Which has OI on par with the entirety of the Walt Disney Company, while still just remaining mostly a streaming company.

 

[DKampy]

Now follow me here… because I know this is hard for you to grasp.

When Disney licenses something to itself, who takes on the overhead associated with their own streaming service?

Whereas when Sony licenses is something to Netflix, who takes on the overhead for Netflix? It’s not Sony.

I suppose Netflix will be going bankrupt any day now then

 

[monothingie]

I suppose Netflix will be going bankrupt any day now then

No, they have competent leadership.

 

[MisterPenguin]

Yes, and with that come the expenses associated with that. It’s the harsh truth and why streaming for companies like Disney have not duplicated the wild success of Netflix. Which has OI on par with the entirety of the Walt Disney Company, while still just remaining mostly a streaming company.

And the sub fees and ad revenue is more than covering the cost of overhead.

Here's an easy question that you can understand... if Disney didn't have a streaming service and instead, licensed its movie to HBO or Amazon, how would it be possible for HBO or Amazon to pay the Disney license *and* pay the overhead of running a streaming service?!

Same question you asked. Same answer: subs and ads are enough to pay for the overhead and the rental of the content.

Disney's DTC *profited* $1.3B in the past fiscal year. That's after paying overhead and paying its studios segment for the studios' content.

 

[Disney Irish]

Now follow me here… because I know this is hard for you to grasp.

When Disney licenses something to itself, who takes on the overhead associated with their own streaming service?

Whereas when Sony licenses is something to Netflix, who takes on the overhead for Netflix? It’s not Sony.

Disney pays the overhead, and? That is still covered by the subs and ad fees.

This is like asking who pays the overhead when Uni licenses out a movie to Comcast for Peacock.

As long as what is coming in is more than what is going out in DTC, they make profit. This is basic corporate accounting 101.

This all comes down to what do you value more, the ticket sale at the theater or the subscription fee paid to a streamer. And its clear you value the ticket sale more even if the overall money paid is the same.

 

[monothingie]

And the sub fees and ad revenue is more than covering the cost of overhead.

Here's an easy question that you can understand... if Disney didn't have a streaming service and instead, licensed its movie to HBO or Amazon, how would it be possible for HBO or Amazon to pay the Disney license *and* pay the overhead of running a streaming service?!

Same question you asked. Same answer: subs and ads are enough to pay for the overhead and the rental of the content.

Disney's DTC *profited* $1.3B in the past fiscal year. That's after paying overhead and paying its studios segment for the studios' content.

Now imagine the larger profit if Disney licensed their content to Netflix or Amazon or Apple for distribution. What would the overhead be on that?

This also doesn’t even account for original programming and content.

It also has nothing at all to do with the fact that the increase in OI was almost exclusively due to raising prices.

 

[monothingie]

Disney's DTC *profited* $1.3B in the past fiscal year. That's after paying overhead and paying its studios segment for the studios' content.

That’s cute, Netflix OI was more than 10 times that, with margins almost double that of the entirety of the Walt Disney Company

 

[Wendy Pleakley]

Like Yogurt wisely said, "Merchandising, It's where the real money from the picture is made."

Of course, the post theatrical revenue comes from Merchandising, DTC, and PVOD (iTunes, Youtube, Amazon, etc.) The digital replacement for physical media sales. Note this different from DTC streamers like D+ or Hulu.

However because the window between theaters and DTC for most productions is just a matter of weeks, no one really goes out and buys the digital copy, because days later it's available for "free" on their subscribed streaming service.

Now don't get me wrong, some streamers pay big $$$ for rights to stream tentpole franchises. But...that only applies to very small percentage of productions.

When The Walt Disney Company (Studios) licenses a movie to itself for DTC (D+), where does the money come from? The amount is irrelevant.

Left Pocket to Right Pocket.


When Sony License a movie to Netflix for DTC, where does the money come from?

For Disney it comes from and goes back into the same pot at the end of the day. That's the problem.

Again, do you have any facts to support your opinions? I'm assuming no.

We don't know the numbers. People do in fact buy digital copies.

Disney has lengthened the window between digital purchase and D+, so we can assume they wanted to improve their digital sales numbers and that D+ was cutting into those numbers. It makes sense because Disney fans are generally loyal and most will have D+.

I do not suggest my speculation represents any sort of facts.

We've also seen some studios go for shorter theatrical windows. Movies are released digitally with the "bring the theater home" advertisement tagline. There are clearly people who will pay more of a premium for a movie that comes to digital quickly. There is value or demand in owning something that just came out in theaters.

 

[TP2000]

Ouch at the Running Man. Didn't that have a similar budget to Badlands? Are we going to see some essays about that one?

Your post made me do a double-take and think... "Did I miss something? Is The Running Man from a Disney studio?"

I had to do a 3 second Google search to learn and... nope. Phew! You scared me for a second.

I'm not sure any of us Disney fans care about The Running Man, as it's produced and distributed by Paramount Pictures.

Does Paramount even still have a licensing agreement with a theme park chain? Does it still have branding at Carowinds?

Back to Google... nope. Paramount Pictures has no theme parks left, and not even a licensing agreement with a park today. What was your point on the weak box office of The Running Man again?

 

[DKampy]

Your post made me do a double-take and think... "Did I miss something? Is The Running Man from a Disney studio?"

I had to do a 3 second Google search to learn and... nope. Phew! You scared me for a second.

I'm not sure any of us Disney fans care about The Running Man, as it's produced and distributed by Paramount Pictures.

Does Paramount even still have a licensing agreement with a theme park chain? Does it still have branding at Carowinds?

Back to Google... nope. Paramount Pictures has no theme parks left, and not even a licensing agreement with a park today. What was your point on the weak box office of The Running Man again?

Well you enjoyed doing comparisons for similar movies at opposing studios in the past….Both Predator and The Running Man were science fiction action movies staring Arnold Schwarzenegger in the 80’s…but I guess this time it does not fit your narrative

 

[Sirwalterraleigh]

Subscriptions and ads.

This isn't new information.

They make less off those - gross - now than they made of fees and ads on linear in 2010…

Again…the truth is out there

Costs might be “a tad” more…especially if you’re rolling out flops that you are supposed to “profit” off of left and right. Only Hulu is actually working as it stands

 

[Sirwalterraleigh]

I suppose Netflix will be going bankrupt any day now then

You really gotta search for the midway point between

“Everything the COMPANY does is a hit!”

And

“Well that’s it…they’re gonna go bankrupt”

There are many poorly run enterprises that last for a long time in profitability. But their futures diminish over time to the point they may go away.

I can think of one that is about the poster child of that…particularly with what’s going on in their 55% gravy train division. Bankruptcy is not imminent…but bad decision making brings other things you don’t want into play.

I’m shocked at the daily misunderstanding of the key point being Made?…this time in Box office and DTC…but it will happen for all other parts of the business today…agian….because the day is young.

 

[MisterPenguin]

Now imagine the larger profit if Disney licensed their content to Netflix or Amazon or Apple for distribution. What would the overhead be on that?

This also doesn’t even account for original programming and content.

It also has nothing at all to do with the fact that the increase in OI was almost exclusively due to raising prices.

Wow. You put the goal posts on a brand new continent.

You went from "internal payments between segments is a scam and hiding huge deficits" to "they coulda made more if they did something different."

I'm done with you. Have a good day.

 

[Disney Irish]

They make less off those - gross - now than they made of fees and ads on linear in 2010…

Again…the truth is out there

Costs might be “a tad” more…especially if you’re rolling out flops that you are supposed to “profit” off of left and right. Only Hulu is actually working as it stands

Whole lot of goal post moving this morning, where were we talking about linear in this discussion? I thought this was about whether a movie is making it to profitability off of DTC? Which as has been discussed, they do in the cases where the shortfall from theatrical is $10M-$20M.

Also Hulu IS D+ bubba, has been officially in the US since March 2024, and now officially around the world as of October 2025. So if Hulu is "working" then by extension so is D+, as they are linked together.