Disney Encouraged to Sell Off ABC & ESPN as stock faces worst year since 1974

[ohioguy]

Disney Analyst: Spinning Off ESPN, ABC Is “Best Path Forward”:​

Disney Analyst: Spinning Off ESPN, ABC Is “Best Path Forward”

"We see it as a reasonably probable late-'23 event," writes Wells Fargo's Steven Cahall.

www.hollywoodreporter.com

Disney stock on its way to worst year since 1974 after ‘Avatar’ sequel disappoints:​

Disney stock on its way to worst year since 1974 after 'Avatar' sequel disappoints

"Avatar: The Way of Water" couldn't reverse Walt Disney Co.'s recent stock funk.

www.marketwatch.com

Has Iger been brought back to break up the company?

 

[Sirwalterraleigh]

Ehhh…not buying it.

There would have to be a “buyer” and who in the hell is looking to go deeper Into cable distribution?

 

[orky8]

Selling off Fox would make a lot more sense to me. Was a terrible decision in the first place. In the pursuit of Disney+ content Iger abandoned all semblance of the Disney brand.

 

[CaptainAmerica]

Selling off Fox would make a lot more sense to me. Was a terrible decision in the first place. In the pursuit of Disney+ content Iger abandoned all semblance of the Disney brand.

The Walt Disney Company is not just "the Disney brand." It is many brands. Fox doesn't make Disney-branded content and pretty much the only content they make for Disney+ is National Geographic branded. Most of what Fox does is for Hulu, and if Disney wants their bundle in every household, they need content for adults.

 

[CaptainAmerica]

Ehhh…not buying it.

There would have to be a “buyer” and who in the hell is looking to go deeper Inti cable distribution?

Selling ABC strikes me as plausible. They don't need it, unless they really want to stay in the News business.

A new "cable" bundle consisting of Disney+, Hulu, ESPN+, and the ESPN linear networks would be very powerful.

 

[Sirwalterraleigh]

Selling ABC strikes me as plausible. They don't need it.

A new "cable" bundle consisting of Disney+, Hulu, ESPN+, and the ESPN linear networks would be very powerful.

People always say this…but the reality is espn has going straight down for 15 years and the rights are insane

And you’re going with the “Disney+ is gonna be HUGE” thing?

I’m with @monothingie on this…it’s already YUGE…and there’s no money in it

 

[orky8]

The Walt Disney Company is not just "the Disney brand." It is many brands. Fox doesn't make Disney-branded content and pretty much the only content they make for Disney+ is National Geographic branded.

From a corporate conglomerate POV, you are not wrong. But the Disney name used to mean something, which is why Disney released adult content under MGM. Now Disney+ means what, exactly? All the content owned by the Walt Disney Company? When you used to watch the Disney channel, was it expected to be family friendly Disney entertainment? I think so. As the word "Disney" continues to lose meaning because the leaders of the Walt Disney Company never respected or agreed with what it stood for, it will ripple through all aspects of the business as I believe we are seeing. Ironic at 100 years we are seeing such a rapid acceleration of the brand degradation.

 

[CaptainAmerica]

People always say this…but the reality is espn has going straight down for 15 years and the rights are insane

ESPN is going down because people are exiting the cable bundle. If a sports fan can get ESPN for $40 rather than paying Comcast $150 for Expanded Basic (of which Disney gets what, $10? $15?), they're going to do it.

And you’re going with the “Disney+ is gonna be HUGE” thing?

I’m with @monothingie on this…it’s already YUGE…and there’s no money in it

The price started too low, they launched without ads, and they spent way too much money producing crappy content. All three of those wrongs are in the process of being righted.

From a corporate conglomerate POV, you are not wrong. But the Disney name used to mean something, which is why Disney released adult content under MGM. Now Disney+ means what, exactly?

Are you under the impression that Disney releases adult content under the Disney brand? Because they don't.

All the content owned by the Walt Disney Company? When you used to watch the Disney channel, was it expected to be family friendly Disney entertainment? I think so. As the word "Disney" continues to lose meaning because the leaders of the Walt Disney Company never respected or agreed with what it stood for, it will ripple through all aspects of the business as I believe we are seeing. Ironic at 100 years we are seeing such a rapid acceleration of the brand degradation.

Again, Disney+ is an umbrella service that includes many brands. It's not an exclusive service of the Disney brand.

 

[Goofyernmost]

I don't know what one(s) they should give up but I can tell you this if there are that many areas that are dragging TWDC down then it looks pretty bad for very much constructive to get done at the parks. The parks, allegedly, are still drawing in handfuls of money and will be looked at after they fix the current losers. It's part of the old saying "When you're up to your butt in alligators it is hard to remember your original objective was to drain the swamp". The parks will once again fall to the end of the to do list.

 

[marni1971]

From a corporate conglomerate POV, you are not wrong. But the Disney name used to mean something, which is why Disney released adult content under MGM.

That’s why they bought Miramax. Back when they had a clear, logical plan.

 

[Sirwalterraleigh]

ESPN is going down because people are exiting the cable bundle. If a sports fan can get ESPN for $40 rather than paying Comcast $150 for Expanded Basic (of which Disney gets what, $10? $15?), they're going to do it.


The price started too low, they launched without ads, and they spent way too much money producing crappy content. All three of those wrongs are in the process of being righted.


Are you under the impression that Disney releases adult content under the Disney brand? Because they don't.


Again, Disney+ is an umbrella service that includes many brands. It's not an exclusive service of the Disney brand.

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Are we really gonna swim upstream on this right now?

It’s steaming…it’s very nature allows people to get bored and move on easily

The cable bundles did not though …they were trapping and inconvenient.

That’s why they worked. Everyone threatened to cancel…but for 30 years no one bothered to have a guy come out in 3-17 weeks and disconnect the line

 

[CaptainAmerica]

Are we really gonna swim upstream on this right now?

It’s steaming…it’s very nature allows people to get bored and move on easily

The cable bundles did not not…they were trapping and inconvenient

That’s why they worked

Streaming didn't kill cable, DVRs killed cable. Streaming was the inevitable consequence once DVRs had already killed people's willingness to tolerate "appointment television."

Sports and News are immune from this because Sports and News need to be consumed live. Ergo, streaming Sports.

 

[Slpy3270]

Has Iger been brought back to break up the company?

No.

The "analyst" in that note is the same dude who suggested CBS would exit their NFL deal early because he believed Paramount wouldn't be able to afford it as time went on (lol). To part ways with a linear business that will be profitable for years to come in favor of a business that will either never turn a profit or get anywhere near the profits of cable/broadcast TV (a lesson the digital-savvy newspaper industry is learning the hard way) is bonkers.

Considering Iger came from the ESPN/ABC side of the business, there's good reason to believe he'll do all he can to ensure the cable and broadcast networks remain profitable, even though that will likely mean more consolidation and layoffs (things that are going to happen, spin-off or not).

There aren't going to be any asset sales. Iger even stated in the recent town hall he's happy with the assets they have.

Furthermore, the stock market fall from Monday has less to do with the Avatar opening and more to do with the overall recession panic in the market. Otherwise WBD wouldn't have dropped even worse that day.

Selling off Fox would make a lot more sense to me. Was a terrible decision in the first place. In the pursuit of Disney+ content Iger abandoned all semblance of the Disney brand.

The addition of FX and the Nat Geo channels strengthened Disney's hand in retransmission renegotiations. The merger wasn't just about Disney+.

Furthermore, Rupert Murdoch was planning to get out of the content production business no matter what. Disney was, for better or for worse, the only one who would've at least remind people 20th Century and Searchlight still existed (do people actually think Searchlight would've survived under Universal when they already have Focus Features?).

 

[orky8]

Are you under the impression that Disney releases adult content under the Disney brand? Because they don't.


Again, Disney+ is an umbrella service that includes many brands. It's not an exclusive service of the Disney brand.

We are just going to have to agree to disagree, even though I'm mostly agreeing with you, because it's the internet and you can't concede any points in an argument...

No, Disney releases adult content under a different brand (as I stated), but it will be put in Disney+ because the content is owned by the Walt Disney Company, further eroding the Disney brand. So far, the R rated movies are fairly few on Disney+ and the only ones I know of are comic book genre (like Deadpool). Simpsons is on Disney+. It is owned by the Walt Disney Company. I loved the Simpsons (haven't watched in forever, but have no problem with it). But, it is NOT Disney, IMO. (Orville, which I just watched and thoroughly enjoyed was another example). Brand needs to have meaning especially when the main thing you sell is your brand (magical, family, insert marketing adjective).

Iger wanted Disney+ to be the new Netflix instead of the new Disney Channel and replacement for DVD sales. That is the fundamental problem, IMO.

 

[Sirwalterraleigh]

Streaming didn't kill cable, DVRs killed cable. Streaming was the inevitable consequence once DVRs had already killed people's willingness to tolerate "appointment television."

Sports and News are immune from this because Sports and News need to be consumed live. Ergo, streaming Sports.

I’m not predicting that either D+ or espn is gonna fail…

But there just isn’t the money in it that tweedle dee and dumb sold.

It’s the model…not the product

They seriously expect people by like June to pay $25 a month and watch commercials…

Let’s see it play

And I don’t know if you have noticed news…but it is in full collapse. Slashes across the board. Cnn just shut off a full station

 

[orky8]

I don't know what one(s) they should give up but I can tell you this if there are that many areas that are dragging TWDC down then it looks pretty bad for very much constructive to get done at the parks. The parks, allegedly, are still drawing in handfuls of money and will be looked at after they fix the current losers. It's part of the old saying "When you're up to your butt in alligators it is hard to remember your original objective was to drain the swamp". The parks will once again fall to the end of the to do list.

Yes, I think you are right. Except to spend $100M+ reskinning one of the most beloved rides instead of adding desperately needed capacity.... Though, I guess if you remove enough AAs and effects, the costs could be justified in a spreadsheet.

 

[GhostHost1000]

People always say this…but the reality is espn has going straight down for 15 years and the rights are insane

And you’re going with the “Disney+ is gonna be HUGE” thing?

I’m with @monothingie on this…it’s already YUGE…and there’s no money in it

ESPN started going downhill rating wise when they starting talking about more things than just sports.

 

[Slpy3270]

And I don’t know if you have noticed news…but it is in full collapse. Slashes across the board. Cnn just shut off a full station

People acting like Disney is headed for imminent bankruptcy while Warner Bros. Discovery is so broke that they're sacking CNN journalists, WB creatives and permanently pulling shows and movies from circulation for tax breaks, ticking everyone off in the process. And that's not getting into the possibility of losing the NBA.....

 

[FutureCEO]

Streaming is always going to be money pit unless you have a few streaming companies (much like the cable companies) and companies like Amazon willing to spend billions on a few football games.

 

[Kamikaze]

Ehhh…not buying it.

There would have to be a “buyer” and who in the hell is looking to go deeper Inti cable distribution?

Amazon would buy it.

The only broadcast thing that people watch is live sports. ESPN has that. I can't see Disney selling it.