Disney’s Q1 FY23 Earnings Results Webcast - Wednesday, Feb 8, 2023

[disneylandtour]

Cheaper content. If I had to guess, less Marvel, less Star Wars outside of Mandalorian. Maybe pivot those franchises to animation instead of spending tons of cash on actors and CGI. Develop or buy more reality programming instead of scripted content. Maybe reboot some of the old Disney Channel kids' program premises (without Dan Schneider).

Without Hulu, the reason to buy Disney+ is if you have kids. I think they'll lean into that and try to recreate the old Disney Channel audience that used to pay the premium cable subscription.

I think we're going to see a significant downward shift in actors' salaries in the near future. There's simply too much content everywhere to manage previous salary expectations. Also, I think we're going to see D+ as the "try out" space for relatively new actors but in Star Wars or Marvel titles. You know, just like Ms. Marvel. I'm unsure how successful this will be. But I sense that's where this is going. In other words, name-brand series with linear TV talent.

 

[CastAStone]

Would anyone be willing to explain how they’ve said they plan to make Disney+ profitable? I honestly am having trouble grasping how they plan to spend less on it and retain subscribers at the same time.

1) invest far less in Discovery+ type content
2) find more synergy with TV (Abbott Elementary was provided as an example of a show that makes money for them linear while simultaneously providing content that drives subs for streaming; while that’s on Hulu the concept is the same)
3) it sounds like some D+ exclusive content may get non-D+ distribution. Currently most things that premiere on D+ don’t get a BluRay or anything.
4) raise prices
5) spend less on marketing
6) advertising tier.

 

[Drdcm]

I wonder if they would ever go the DirecTV route. You lock yourself in to a 2 year contract to access any Disney content.

 

[ctrlaltdel]

HBO is kind of the model one would shoot for with "less content, higher quality" (not HBO Max, the original company), though they take a lot of comparative risk and invest in much more adult fare. They pretty consistently kill it though with making massively popular shows, whether wholly original or based on IP (as we now see with The Last of Us becoming a massive hit).

 

[Indy_UK]

They need to just offload Hulu and move that content under Star on Disney+ just like they have elsewhere. It would sure bring their 20th century Pictures sent down.

Also, I hope these lay-off are within the Streaming sector. Disney+ has the market share but like mentioned, they need to make less programs but of better quality. Also, more partnership deals may not be a bad deal either.

 

[Sirwalterraleigh]

I wonder if they would ever go the DirecTV route. You lock yourself in to a 2 year contract to access any Disney content.

…give that one a whirl

 

[CastAStone]

6) advertising tier

And I will say that back when they used to publish the ARPU of Hulu with ads separately from Hulu without ads, Hulu made WAY more money off of Hulu with ads. IIRC it was almost double.

 

[CastAStone]

They need to just offload Hulu and move that content under Star on Disney+ just like they have elsewhere. It would sure bring their 20th century Pictures sent down.

Also, I hope these lay-off are within the Streaming sector. Disney+ has the market share but like mentioned, they need to make less programs but of better quality. Also, more partnership deals may not be a bad deal either.

Who would buy Hulu if Disney is keeping all the content?

 

[Sirwalterraleigh]

Would anyone be willing to explain how they’ve said they plan to make Disney+ profitable? I honestly am having trouble grasping how they plan to spend less on it and retain subscribers at the same time.

If you can come up with plan…let Bob know

All they’ve done is scream “brand! Brand! Brand!” For the better part of a decade…

I don’t know if that qualifies as a “plan”

 

[MrPromey]

It was interesting that Bob said the previous regime looked into selling ESPN.

Such agressive-agressive behavior!

They spent $20 million and by damn, they're going to get their money's worth!

 

[Indy_UK]

Who would buy Hulu if Disney is keeping all the content?

I am assuming Comcast and maybe Disney has a deal where content is shared then for 2-3 years?

I don’t see any reason for Disney to keep Hulu when you already have Disney+ with the subscribers it’s doing

 

[Drdcm]

If you can come up with plan…let Bob know

All they’ve done is scream “brand! Brand! Brand!” For the better part of a decade…

I don’t know if that qualifies as a “plan”

Focus on theaters and home video (not streaming).

For D+, stick to Disney animated movies greater than 2 years old. And charge 2-3$ a month. Target parents with small kids who put frozen on repeat all day.

This plan would not be for us…

 

[Tha Realest]

Who would buy Hulu if Disney is keeping all the content?

I wonder if that hint towards “licensing” content has to do with this. If they walk away from Hulu, have to imagine some of the legacy productions and Fox streaming rights would be retained for a period of time

 

[CaptainAmerica]

If they make less, I’ll just subscribe less I guess. I can always subscribe for one month a year and watch the two new shows that are good…

They don't want you, that's the whole point. It's not worth the money it takes to keep would-be churners from dropping out.

Bob: It's also obvious to us is we can't get the profitability and turn this into a growth business without growing subs. So, while we're taking off-the-table sub guidance, we're still going to look to grow subs. We just want to grow quality subs that are loyal and where we actually have an ability to continue to price effectively to those subs. In addition, we're going to lean more into our franchises, our core franchises, and our brands.

 

[Tha Realest]

Bob: …In addition, we're going to lean more into our franchises, our core franchises, and our brands.

It’s shocking how much of what we heard yesterday could have just as easily been said by Bob C rather than Bob I.

 

[fgmnt]

No, the opposite of that.

The focus will be on reducing the volume of content. They were too focused on building up a huge library of stuff and they were spending a fortune on low-quality junk that nobody watches.

They want less content, but want the content they do produce to be high-quality.

Making less of what people are not watching while trying to charge more for what is left is the needle they are trying to thread. I earnestly think that the Disney Bundle is a deal for most households at $20/month and probably could squeeze another $5 from me easily but I'm just one data point.

 

[Drdcm]

They don't want you, that's the whole point. It's not worth the money it takes to keep would-be churners from dropping out.

Bob: It's also obvious to us is we can't get the profitability and turn this into a growth business without growing subs. So, while we're taking off-the-table sub guidance, we're still going to look to grow subs. We just want to grow quality subs that are loyal and where we actually have an ability to continue to price effectively to those subs. In addition, we're going to lean more into our franchises, our core franchises, and our brands.

No kidding

 

[CaptainAmerica]

It’s shocking how much of what we heard yesterday could have just as easily been said by Bob C rather than Bob I.

I don't know why this makes people upset. "Disney is going to make more Disney stuff and less random prestige dramas" seems like a pretty good idea to me.

 

[Tha Realest]

I don't know why this makes people upset. "Disney is going to make more Disney stuff and less random prestige dramas" seems like a pretty good idea to me.

Oh I’m not upset. It’s just shocking how little “change” (other than emotional quotient) we’re seeing.

 

[Drdcm]

I don't know why this makes people upset. "Disney is going to make more Disney stuff and less random prestige dramas" seems like a pretty good idea to me.

I’m not upset either. If they have enough content that I like, I’ll subscribe. If not, I won’t. Right now, I’m subscribed.