News Disney announces strategic restructuring of media and entertainment divisions.

[Jrb1979]

I’m a fan of anything that makes good content more accessible and in demand. Streaming does this and I think it’s a net positive for the industry.

This is Hollywood’s largest experiment ever. Even Netflix doesn’t exactly profit a whole lot of money right now, so it’s going to be interesting to see what the future holds. Obviously higher prices are in the future.

I disagree completely. IMO it just pushes us to be more of a hermit society faster. Before Covid less and less people were going out to see movies, or to eat out. I look at where I live most restaurants were far from packed before Covid happened. Weekends places were dead by 11pm.

 

[Sirwalterraleigh]

The "linear channels" were the only profitable segment in all of the Disney Company the past quarter (that we have financials for). They offset the losses of all the other segments such that the last quarter was a net wash (that is, they didn't have a loss, but, they didn't profit $4B like they would have per quarter).

If anything, the linear channels -- which push content directly to homes -- was proven to be pandemic-proof.

And that is why Disney is all-in on streaming. It's pushing content directly to homes bypassing the middleman of cable/broadcasters. It's the future of home entertainment. And again... pandemic-proof.


Now, I'm not going to say that Disney will give up on theatrical releases. As much as Iger has said in every quarterly call since D+ was announced that D+ was their top priority, Iger equally stressed (when badgered by analysts in every call to give up the theatrical window) that Disney movies are committed to the traditional 'windows' (theaters, PPV, premium cable, broadcast/cable, DVD, streaming). Each window is an opportunity to make money from the film.

The recent restructuring announcement clearly states there still is a division producing content for theaters.

But when there are no (functionally operational) theaters, well, Disney can make an exception for a while and go direct to stream... if they think it will bring in a premium, or, increase/retain subs.

I don’t think their limiting their options at all...they’ll wait it out...but I think they are:

1. Pressing their biggest advantage. The atream
2. Limiting exposure to the biggest weakness - theatrical releases.

I also think they are going to pay whatever it takes to get the nfl package from Fox...which I believe is next year. No network ever regretted overpaying for the nfl. Just a hunch

 

[Sirwalterraleigh]

I disagree completely. IMO it just pushes us to be more of a hermit society faster. Before Covid less and less people were going out to see movies, or to eat out. I look at where I live most restaurants were far from packed before Covid happened. Weekends places were dead by 11pm.

Sign of the times...

I don’t think this change is temporary.


I think Disney is trying to be proactive in what they can control

 

[Mouse Trap]

I disagree completely. IMO it just pushes us to be more of a hermit society faster. Before Covid less and less people were going out to see movies, or to eat out. I look at where I live most restaurants were far from packed before Covid happened. Weekends places were dead by 11pm.

You’re missing the point. I don’t think theaters are going anywhere. Even if they can’t raise any debt, someone will buy them out. If streaming or PVOD was so profitable then Disney would have already tossed Black Widow on D+. Universal would be putting Fast and Furious on Peacock, HBO would be getting Wonder Woman, the list goes on. The proof is in these actions.

My point is smaller, indie films now have an outlet to reach the masses through streaming. Years ago your only option to catch most indie films was to either live in a major city or pay $20+ VOD which most people won’t for an indie film. If it’s bundled into a streaming service then people are much more likely to watch.

 

[_caleb]

I think it's going to eventually revert back to something like the cable model. I've actually been saying that for years. Whether it's a streaming package or they all just consolidate under one service like Netflix, I just don't believe it will be economically feasible for 10-15 different places (if not more) to all have their own streaming service with their own exclusive content without eventually having to charge $15-20 per month or more for access. People aren't going to pay that for every service; they'll either subscribe to a couple all the time and ignore the rest or they'll subscribe for one month to watch something and then drop it. I don't believe either of those options will work long-term for the people operating the services.

I agree, and I think Disney does too- which is why they went all-in on Disney+. There's really only room for a few streaming services in most people's budgets. Is anyone going to pay for CBS All Access (or whatever it's called) when prices start going up?

 

[_caleb]

I disagree completely. IMO it just pushes us to be more of a hermit society faster. Before Covid less and less people were going out to see movies, or to eat out. I look at where I live most restaurants were far from packed before Covid happened. Weekends places were dead by 11pm.

I get what you're saying, but typically people staying in for dinner and a movie are actually interacting (virtually) with friends and family. When people go out to restaurants and movies, it's not really as though they're chatting with strangers much, are they?

 

[UNCgolf]

I also think they are going to pay whatever it takes to get the nfl package from Fox...which I believe is next year. No network ever regretted overpaying for the nfl. Just a hunch

I believe they're up across the board in 2022. The primetime games on Thursday, Sunday, and Monday nights, and the standard broadcast window on Sunday afternoons.

 

[MisterPenguin]

I agree, and I think Disney does too- which is why they went all-in on Disney+. There's really only room for a few streaming services in most people's budgets. Is anyone going to pay for CBS All Access (or whatever it's called) when prices start going up?

I get around the cost of a monthly subscription by signing up for a month, bingeing a season of what I want (the latest Star Trek) and unsubbing. It's just like paying only for that season.

Which is also what I do when I can. E.g., American Gods on Starz. I just wait until the latest season can be bought on Amazon, and then I watch it there.

 

[UNCgolf]

I get around the cost of a monthly subscription by signing up for a month, bingeing a season of what I want (the latest Star Trek) and unsubbing. It's just like paying only for that season.

Which is also what I do when I can. E.g., American Gods on Starz. I just wait until the latest season can be bought on Amazon, and then I watch it there.

Yep, I think a lot of people do this.

As I said in my post, that's just not going to work for these streaming services long term. They can't spend millions and millions of dollars on a show (I think Picard cost near $100 million) and then only get $6 or $10 from a person to watch it -- especially when that one subscription is often used by multiple people to watch the program. Even if they got 10 million people to subscribe at the $10 a month price for one month, that's basically a wash at best and would probably actually be a loss of money, since there are also other costs involved with running the platform beyond just the cost of making that one show.

The other potential option is that they start requiring you to subscribe for a year at a time, but I don't think that would work well either. From what I know about the services, they really need the steady income stream of subscribers who stay subscribed year round. It kind of feels like they are just hoping people will subscribe for something and then forget to unsubscribe.

 

[FeelsSoGoodToBeBad]

What saddens me is how more and more we as a society have become hermits. I see it all the time even before Covid. Its not just the theatres, its restaurants, bars and live events. More and more would rather stay home then go out to do anything.

While I don't think this is true for everyone, I understand where you're coming from. I and many of my friends have teenagers and pre-teens. Where I could. not. WAIT. to get my driver's license so I could "GO" and "DO" and spend time with my friends doing things together, that motivation isn't as strong in teens today. It wasn't there pre-COVID and it certainly is less so now.

Young people today are able to play games and watch movies with their friends online. They can connect at any moment with as many or few people as they like within seconds. They can learn about almost anything online and see the wonders of the world in a way we couldn't even conceive of when we were their age. For us, the only way to experience any of those things was to actually GO and DO them. So where we (GenX) were motivated to be out in the "real world", "kids today" (geeze I feel old saying that) just ...aren't.

My hope is that as they get older they'll see more of the value of life outside their comfort zones and away from their screens someday. That said, COVID has definitely pushed them in the opposite direction making home more about being safe and comfortable that it has ever been before. Because of this, I can absolutely see streaming on a multitude of platforms overtaking (maybe obliterating) network TV and cable programming as it exists today. Unfortunately, that will only further push some people into being hermits.

 

[UNCgolf]

Of course, as a counter to what I just said, Uber and Lyft have been operating with gigantic, almost unbelievable quarterly losses for years now with no obvious road to profitability in sight, and they're still chugging along.

 

[oCMANo]

Suprised Alan Horn is still there. Disney features, outside of the MCU, could be so much better. Remakes and sequels, yuck.

 

[UNCgolf]

Suprised Alan Horn is still there. Disney features, outside of the MCU, could be so much better. Remakes and sequels, yuck.

While I completely agree with the yuck on all the remakes, it shouldn't be surprising that he's still there.

Those remakes have been insanely successful. That's what matters.

 

[SteamboatJoe]

You’re missing the point. I don’t think theaters are going anywhere. Even if they can’t raise any debt, someone will buy them out. If streaming or PVOD was so profitable then Disney would have already tossed Black Widow on D+. Universal would be putting Fast and Furious on Peacock, HBO would be getting Wonder Woman, the list goes on. The proof is in these actions.

My point is smaller, indie films now have an outlet to reach the masses through streaming. Years ago your only option to catch most indie films was to either live in a major city or pay $20+ VOD which most people won’t for an indie film. If it’s bundled into a streaming service then people are much more likely to watch.

No one is saying its going to happen this quarter but the outlook is bleak.

 

[Slpy3270]

I also think they are going to pay whatever it takes to get the nfl package from Fox...which I believe is next year. No network ever regretted overpaying for the nfl. Just a hunch

The only Sunday NFL package I can see them snatch, if any, is the AFC package from CBS.

ViacomCBS still has a merger to digest and they've recently said they'll drop SEC football in 2023. Not good signs when you're trying to keep NFL. And they definitely don't want a repeat of 1994.

 

[TrainsOfDisney]

While I don't think this is true for everyone, I understand where you're coming from. I and many of my friends have teenagers and pre-teens. Where I could. not. WAIT. to get my driver's license so I could "GO" and "DO" and spend time with my friends doing things together, that motivation isn't as strong in teens today. It wasn't there pre-COVID and it certainly is less so now.

Young people today are able to play games and watch movies with their friends online. They can connect at any moment with as many or few people as they like within seconds. They can learn about almost anything online and see the wonders of the world in a way we couldn't even conceive of when we were their age. For us, the only way to experience any of those things was to actually GO and DO them. So where we (GenX) were motivated to be out in the "real world", "kids today" (geeze I feel old saying that) just ...aren't.

My hope is that as they get older they'll see more of the value of life outside their comfort zones and away from their screens someday. That said, COVID has definitely pushed them in the opposite direction making home more about being safe and comfortable that it has ever been before. Because of this, I can absolutely see streaming on a multitude of platforms overtaking (maybe obliterating) network TV and cable programming as it exists today. Unfortunately, that will only further push some people into being hermits.

It seems to me that young people have been traveling more than ever before thanks to the Internet and social media. (Pre covid of course).

Even now my local coffee shop is packed with college kids (socially distanced packed... mostly outdoor seating).

Don’t think that your own kids should have the same desires you did as a kid. Humans will continue to evolve.

 

[Sirwalterraleigh]

I bought two months of cbs to watch Picard...which was wretched.

I enjoyed Discovery. I’m debating if and when i’ll Pick it back up to watch again.

I think that stance is pretty common now. I feel that D+ May get that in November/December too

 

[Slpy3270]

I feel like ABC and ESPN should be sold off. They were bought during Eisner's crazy spending spree in the 90s and never really fit Disney's Core business model.

Two units that make more money than streaming and the studios? LMAO, not happening.

 

[MisterPenguin]

Of course, as a counter to what I just said, Uber and Lyft have been operating with gigantic, almost unbelievable quarterly losses for years now with no obvious road to profitability in sight, and they're still chugging along.

You have to first dominate the market with incredible losses. Then when you're the only game in town, you can start raising prices. See how it worked for MoviePass?!?!

 

[FeelsSoGoodToBeBad]

It seems to me that young people have been traveling more than ever before thanks to the Internet and social media. (Pre covid of course).

Even now my local coffee shop is packed with college kids (socially distanced packed... mostly outdoor seating).

Don’t think that your own kids should have the same desires you did as a kid. Humans will continue to evolve.

I sincerely hope you're right. It really hurts my heart to think about my kiddos not getting out to really SEE the world a bit like I was fortunate enough to do when I was young.