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

[Sirwalterraleigh]

Star Trek gives me some hope, they had a couple box office failures around 2000 and managed to revitalize the series a decade later and make it successful again.

Star Wars could probably benefit from some time off right now, let people forget about the last several years and get excited for SW again. Other than the Mandalorian D+ isn’t helping the cause either, most of the D+ SW shows have been more miss than hit.

Rick berman and a bad parent company ran it into the ground…

They reset and started Again with a new generation who were fans…


…what was my point again?

 

[Disney Irish]

Ummm…I know what’s what they sold you…I can listen to the quarterly call too!

Let’s see what happens?


The flaw in disney plus…if there is one…is their assumption that at somepoint they can go into “cruise control” and get a hold on content costs. That’s is a huge assumption on their part.

Its not just what they "sold", its logically how it works. Its how the whole studio system has worked since the birth of cable. D+ and other streamers are just the next evolution of that same system. Whether you believe people don't want to go back to the "90s" or not, its happening linear is dying. Trust me, I fought it for a long time in the early to mid-10s saying streaming was just a fade but then I came around due to seeing the increase in Netflix subs over time.

So yes at some point as you spend less on linear, which again is already happening, you move that spend over the streaming without much increase. This all was suppose to happen a lot slower, but the pandemic accelerated it which is why the spend skyrocketed so quickly on both sides. Things are already evening back out and you see they, along with all other Studios and Netflix, are cutting back on their spend for streaming. This is all in order to make the streamers profitable. We'll see if they can turn a profit in FY24 as predicted, I think they can.

 

[Sirwalterraleigh]

Its not just what they "sold", its logically how it works. Its how the whole studio system has worked since the birth of cable. D+ and other streamers are just the next evolution of that same system. Whether you believe people don't want to go back to the "90s" or not, its happening linear is dying. Trust me, I fought it for a long time in the early to mid-10s saying streaming was just a fade but then I came around due to seeing the increase in Netflix subs over time.

So yes at some point as you spend less on linear, which again is already happening, you move that spend over the streaming without much increase. This all was suppose to happen a lot slower, but the pandemic accelerated it which is why the spend skyrocketed so quickly on both sides. Things are already evening back out and you see they, along with all other Studios and Netflix, are cutting back on their spend for streaming. This is all in order to make the streamers profitable. We'll see if they can turn a profit in FY24 as predicted, I think they can.

I made no declarations…only asked questions…

It will be what it is. Let’s see if the bobs knew what they were talking about?

Will people pay more - cause Bob said he has to charge more - for declining content expenditures?

We shall see.

I heard an interesting factoid yesterday. So no college student with a federal guaranteed loan has acrued any interest since 8/1/2020…
Wonder how much those loans have outstanding?
Glad I asked…$1,667,000,000,000.
In principle.

So what do people have to weigh when that ends on 8/1/2023?
Discretionary spending.

What company sells ONLY discretionary?

You guess it…Apple

…and others.

We live in interesting times.

 

[Disney Irish]

I made no declarations…only asked questions…

It will be what it is. Let’s see if the bobs knew what they were talking about?

Will people pay more - cause Bob said he has to charge more - for declining content expenditures?

We shall see.

I heard an interesting factoid yesterday. So no college student with a federal guaranteed loan has acrued any interest since 8/1/2020…
Wonder how much those loans have outstanding?
Glad I asked…$1,667,000,000,000.
In principle.

So what do people have to weigh when that ends on 8/1/2023?
Discretionary spending.

What company sells ONLY discretionary?

You guess it…Apple

…and others.

We live in interesting times.

Yes we shall see, but my bet is on streaming being successful long term. The genie is out the bottle, he ain't going back in.

They'll either pay more or they'll switch to a FAST version of the services with ads, either way the Mouse gets it money.

 

[Sirwalterraleigh]

Yes we shall see, but my bet is on streaming being successful long term. The genie is out the bottle, he ain't going back in.

They'll either pay more or they'll switch to a FAST version of the services with ads, either way the Mouse gets it money.

It’s what Hollywood is banking on.

They also rode broadcast cable into the Ground

Led by a certain sports network that laid off everyone who had been there more than 3 months yesterday

 

[Sirwalterraleigh]

They'll either pay more or they'll switch to a FAST version of the services with ads, either way the Mouse gets it money.

You are aware they lost subscribers this winter, right? Like 4 mil?

That’s something to keep an eye on. Tough to mesh that with “we’re going cheap on content”

 

[Disney Irish]

You are aware they lost subscribers this winter, right? Like 4 mil?

That’s something to keep an eye on. Tough to mesh that with “we’re going cheap on content”

They lost 4M of the cheapest subs they had, ie the ones making them no money, they gained almost 1M of the more expensive subs, ie the ones that they want that will lead the service into profitability.

 

[flynnibus]

The issue with Netflix is they don't have a real studio system like other streamers, hence they have to buy up their content to keep up/ahead which ends up costing more and more.

Disney doesn't have that issue, so their studio system can feed D+ just like it has for linear for decades. As linear investment fades, and it is and will continue, D+ will get the primary content spend without much overall increases to the bottom line. Its the short term pains of feeding both that just have to be gotten through, but the days of profitability for D+ are fast approaching.

The fundamental issue is the lack of ppv and the cost differences.

Disney will still be spending huge amounts of money to produce content each year… but the new content will not generate enough NEW revenue to support it. So you have this disparity that the streaming service revenue will flat line… while the demand to pay to generate content will not go away.

The “faulty math” people keep pointing out is the actual number of subscribers needed to actually offset those production costs.

three 400m dollar films … even with 200million subs… you eat up nearly 10% of gross revenues just to cover the film cost… let alone other expenses or profits.

Without ads, ppv… there isn’t anyway for films to make more money for the companies… sub growth will stagnate and they’ll be spending billions just to not lose subs.

The days of ad free streaming is quickly going to go away. Companies need to generate revenue that tracks with popularity.

 

[Disney Irish]

The fundamental issue is the lack of ppv and the cost differences.

Disney will still be spending huge amounts of money to produce content each year… but the new content will not generate enough NEW revenue to support it. So you have this disparity that the streaming service revenue will flat line… while the demand to pay to generate content will not go away.

The “faulty math” people keep pointing out is the actual number of subscribers needed to actually offset those production costs.

three 400m dollar films … even with 200million subs… you eat up nearly 10% of gross revenues just to cover the film cost… let alone other expenses or profits.

Without ads, ppv… there isn’t anyway for films to make more money for the companies… sub growth will stagnate and they’ll be spending billions just to not lose subs.

The days of ad free streaming is quickly going to go away. Companies need to generate revenue that tracks with popularity.

Hence why all streaming services are adding or switching to FAST, including Netflix who said they would never have ads, to offset those losses you mentioned.

There is a long term equilibrium between content spend, subs, and ads that will happen and lead to success in streaming. When, I don't know but it will happen, Disney still thinks sometime in FY24, we'll see.

 

[Sirwalterraleigh]

They lost 4M of the cheapest subs they had, ie the ones making them no money, they gained almost 1M of the more expensive subs, ie the ones that they want that will lead the service into profitability.

Oh I see…so when Pengs shouted “gain” numbers for 37 months…those where “real subscribers”

But the loses where “not real subscribers”??

Got it

So how much do you get paid in burbank for internet PR?
It’s really the only plausible explanation sometimes

 

[Sirwalterraleigh]

The fundamental issue is the lack of ppv and the cost differences.

Disney will still be spending huge amounts of money to produce content each year… but the new content will not generate enough NEW revenue to support it. So you have this disparity that the streaming service revenue will flat line… while the demand to pay to generate content will not go away.

The “faulty math” people keep pointing out is the actual number of subscribers needed to actually offset those production costs.

three 400m dollar films … even with 200million subs… you eat up nearly 10% of gross revenues just to cover the film cost… let alone other expenses or profits.

Without ads, ppv… there isn’t anyway for films to make more money for the companies… sub growth will stagnate and they’ll be spending billions just to not lose subs.

The days of ad free streaming is quickly going to go away. Companies need to generate revenue that tracks with popularity.

Yeah…If you dig into it and don’t just believe what anyone in a nametag says…That IS the problem, isn’t it?

I thought I saw where Netflix spent double what their three largest streaming competitors (including Disney) spent on content in 2019 COMBINED…and they still can’t figure out if that’s sustainable or will work?

Streaming takes a bad product that people hate…cable…and puts it into a market with 6+ competitors cable NEVER had…

It’s easier to access…but does that offset the problems longterm?

No one actually knows? Hasn’t gone well though.

 

[Disney Irish]

Oh I see…so when Pengs shouted “gain” numbers for 37 months…those where “real subscribers”

But the loses where “not real subscribers”??

Got it

So how much do you get paid in burbank for internet PR?
It’s really the only plausible explanation sometimes

Trust me I wish I was getting paid by Burbank, I have a bunch of credit cards I'd like to pay off, but sadly I'm not.....

Also they are all "real" subscribers, some just pay less than others which is where the ARPU numbers come in. The loss of subs was largely and primarily in the India region where the average sub pays less than a $1 for the service, leading to an average ARPU of .59 cents. These aren't the subs you need to make the service profitable, so there loss isn't going to be felt other than some headline. Compare that to the increase in the other international regions where there was an increase in subs and they pay the standard D+ rates and have an average ARPU of $5.93. These are the subs you want as that brings in more revenue compared to the subs they lost. Long term you want to keep and gain the subs with higher ARPU. Simple economics my friend.

 

[Sirwalterraleigh]

Trust me I wish I was getting paid by Burbank, I have a bunch of credit cards I'd like to pay off, but sadly I'm not.....
.

So you work in Anaheim then?

…bummer, dude

 

[Disney Irish]

So you work in Anaheim then?

…bummer, dude

Nope, lets put it this way, the closest I come to Disney is tangential.

 

[Sirwalterraleigh]

Nope, lets put it this way, the closest I come to Disney is tangential.

I’m just messing with you

Slow news…and box office day…from Disney

 

[Indy_UK]

Surely a cheap way to increase income is to also clamp down on password sharing like Netflix have done?

Not sure what it’s like in the US but here in the UK, there are so many ways to get Disney+ for a fraction of its costs or even free

 

[MrPromey]

I think they’re too invested now to separate the movies more.

I always wonder if they regret Disney+ and should have just kept the deal to license their content to Netflix. I guess it’s whether Netflix would have been willing to pay up anymore.

D+ is still a good dumping ground for stuff they may decide they don't want to put $200+ into trying to promote for theaters.

A part of me has to wonder when they began live action Pinocchio with Tom Hanks, if the original plan was to make that for D+ or D+ is where it ended up when they looked at what they were making and what was competing for what (like another Pinocchio by an academy award director being made at the same time) and what needed to go where.

Did we get that there instead of Little Mermaid because they decided to gamble on Little Mermaid for theaters instead after things were well along?

Same with Peter Pan and Wendy. Did that begin with D+ as the planned destination or is that where the Jude Law movie ended up once they had a better idea of what they'd made?

Turning Red would not have done well at the box office. I know there are people here who are passionate about it - mostly adults without kids who liked it - but that love for it makes them completely blind to everything working against that movie for a family audience.

Just a reminder, it's not even available on a kid's account on D+. That was Disney's choice to steer family audiences away from it on their very own platform.

I think D+ saved Pixar a box office embarrassment with that one.*

Netflix have had their own share of turds. Bright comes to mind as a perfect example of something that looks like it was made for theaters and ended up streaming instead because someone was trying to not lose everything on it and there have been plenty of others but they do have good originals, too.

Of course, as a traditional media company, Disney's always going to want to put their best stuff in theaters first because in addition to helping them make more cash, a theatrical hit makes the toy/game/merchandise licensing game and theme park tie-ins - where they make their real money off this stuff - much easier.

That said, if D+ becomes known for where all Disney's crap goes, and people have to wait close to a year for the good movies to make it there, how can Disney continue to compete long-term with the pricing they want to charge for it when their streaming competition has new stuff being added weekly from all over the place non-stop?

*which says nothing about the quality of the animation or the artistic value of the story - we're talking about money. Tons of awesome independent films get made that would bankrupt everyone involved if they were getting made and marketed on Pixar budgets.

 

[Jedijax719]

The Flash won't even make as much as Lightyear! Yikes!!

 

[MrPromey]

Nothing should ever fail. If that were true about life, we'd all be in paradise. Very few movies have succeeded since the pandemic. There have only been about 4 movies that have hit a billion since the pandemic. That's 4 in the past 3-4 years. In 2019, Disney had 7 movies hit a billion. Anyone expecting Disney (or any studio) to match that now is crazy and living in fantasy world. Anybody thinking a studio should have more than one billion-dollar movie in a year now is equally crazy. Just not happening. Budgets for ALL studios have swelled since the pandemic due to multiple delays, etc. We may settle into a time where budgets level off (if anyone other than stakeholders care), but the box office results won't change.

Wait to see what happens next year if you think this year is bad. We have Deadpool 3 and Inside Out 2 as the top prospects. I don't see Captain America 4 or Thunderbolts being huge hits unfortunately. And Avatar 2 moved to 2025. 2024 is going to make 2023 look like a goldmine.

Quantumania didn't fail to make a billion dollars because of COVID unless COVID was to blame (which I guess on some level, is possible) for them making a crap movie.

Our butts were back in theaters as soon as they could be, with a can of lysol in-hand that nobody at any theater ever questioned.

I saw Tenent opening weekend.

We saw Raya and the Last Dragon opening weekend.

The limiting factor for me over the past few years has been the tiny trickle of movies available but that has changed this year.

As someone who continues to go to see movies in theaters, probably more eagerly than most others on either side of this this discussion in this thread, I can tell you that there is a pretty big difference in the quality of the overall product in 2023 than there was in 2019.

There are lots of factors at play for the financial issues all studios (but especially Disney) are facing. Having said that, a quality compelling product (especially Disney) is one of the biggest, though.

In the case of Disney, they're still spending but they're clearly not getting their money's worth out of what that money is producing.

Not like they used to, anyway.

Just throwing this out there - I very much want for Haunted Mansion not to suck. Despite how fun the trailer looks to me, I have no reason to think it won't, though based on the current track record.

 

[MrPromey]

I actually agree with you…but the “studio system” stands in the way
Studios like big, quick scores (like a dvc sale )…actors like big, guaranteed paydays

Lawyers like charging for the hour for both…


Hard habit to break.

But here’s what’s wrong with stream: ENOUGH of the 6 episode “seasons”

Star Trek: the next generation was one of the best written/development/acted series (ds9 as good or better)…
It used a future setting to explore deep, emotional characters and many social issues far ahead of it’s time

But that takes time. If it takes 20 hours to do it…SHOOT it.
Don’t overspend/chince it down to 5

Lazy

This makes me think of the argument someone made about Secret Invasion being a slow burn and people just not being able to handle that.

It's an event series with a whopping six episodes. If there were 20 episodes coming our way, they could afford that but at six, if the first third of a series from an action based franchise - the episodes with the most heavy-lifting to hook an audience - are already slow, how does that bode for the remaining four?

I love Sam-L and I'm fine with talky shows so I'll watch this one through - it's at least not silly to the point of being regrettable for me so far, unlike other D+ shows (Book of Fett and She Hulk) but that it isn't being widely praised isn't shocking.

It feels like a Marvel show being made on a shoestring so far, squandering one of the most compelling characters they currently still have.