Disney's Financial Problems

[LeighM]

“something for everyone” only works if it’s good enough and there’s equal demand for it…which will never happen.

It’s kinda the elephant in the room for the concept of immensely profitable streaming

"Good enough" is subjective though. Right now, the offerings on Disney+ ARE good enough for me. What isn't good is the increasing prices. Most of my friends with it feel the same way as I do. Right now, they haven't increased the price enough to make me consider cancelling, however, they are making me think about it. I almost compare it to HBO Max (now Max). I got a subscription to that in the beginning of the pandemic because of same day movie releases. The intro offer was low and I felt like I was getting value. We enjoyed the movies and the original programming but the same day movies have stopped and the original content dwindled - and I have no interest in the DC Universe. I'll probably not renew when mine expires and will do a month to month later when every episode of the new season of Perry Mason is available. I "had" to get a subscription to Paramount+ because that's where they moved some of my favorite TV shows after removing them from network (which still makes me angry and I don't want to get started down that road....").

 

[ohioguy]

Acquisition rumors are beginning to percolate; it's possible Disney will become part of a larger conglomerate and assets will be either combined, folded, or sold.

Apple's name keeps coming up as a possible buyer. They have a large cash reserve and $3 trillion in market cap, which would make the acquisition happen without much cost to the company or the stockholders. Of all the tech companies - which have the money and wherewithal to make a corporate merger a reality - Apple is the logical choice, since the companies are quite similar. Apple would gain not just the extensive Disney catalog for their streaming and entertainment divisions, but also quite a few big-time tech players that are Disney subsidiaries: THX (audio and video), Skywalker Sound, Pixar animation, Disney Digital Services, Disney Games, Marvel Games, and Disney Imagineering.

It seems far-fetched, but in reality a merger with Apple is a natural fit, considering "so much of Disney is located at the same intersection of Technology and the Liberal Arts that Apple calls home." :

Apple buying Disney isn't the fairy tale it once was

When you're as big as Apple, you need to get creative in order to seek growth.

www.macworld.com

 

[FutureCEO]

It doesn't help that their new original programming caters to niche segments. Not everyone is a Star Wars fan. Willow was a flop (you couldn't even "see" the episodes; they were so dark). The National Geographic programing isn't really attractive to a mainstream audience. The kids programs are too silly for any adults to really watch. And let's face it, without a wide release of films in movies, their visibility is limited so unlikely to capture people who may have otherwise seen it in a movie theater (same for other streaming services). Hamilton is really the only time there seemed to be a real push into the mainstream visibility, but that is because Lin Manuel Miranda craves attention and was on talk shows promoting it. Other streaming content doesn't really get that, besides maybe an online ad or article.

I'm currently going back and forth between like 5 TV shows at the moment including one National Geographic show which is ok. Tamer than I thought it would be. But I'm only on episode 2. A small light.

 

[FutureCEO]

Acquisition rumors are beginning to percolate; it's possible Disney will become part of a larger conglomerate and assets will be either combined, folded, or sold.

Apple's name keeps coming up as a possible buyer. They have a large cash reserve and $3 trillion in market cap, which would make the acquisition happen without much cost to the company or the stockholders. Of all the tech companies - which have the money and wherewithal to make a corporate merger a reality - Apple is the logical choice, since the companies are quite similar. Apple would gain not just the extensive Disney catalog for their streaming and entertainment divisions, but also quite a few big-time tech players that are Disney subsidiaries: THX (audio and video), Skywalker Sound, Pixar animation, Disney Digital Services, Disney Games, Marvel Games, and Disney Imagineering.

It seems far-fetched, but in reality a merger with Apple is a natural fit, considering "so much of Disney is located at the same intersection of Technology and the Liberal Arts that Apple calls home." :

Apple buying Disney isn't the fairy tale it once was

When you're as big as Apple, you need to get creative in order to seek growth.

www.macworld.com

Too many big conglomerates out there. Not that the government cares.

 

[Sirwalterraleigh]

Acquisition rumors are beginning to percolate; it's possible Disney will become part of a larger conglomerate and assets will be either combined, folded, or sold.

Apple's name keeps coming up as a possible buyer. They have a large cash reserve and $3 trillion in market cap, which would make the acquisition happen without much cost to the company or the stockholders. Of all the tech companies - which have the money and wherewithal to make a corporate merger a reality - Apple is the logical choice, since the companies are quite similar. Apple would gain not just the extensive Disney catalog for their streaming and entertainment divisions, but also quite a few big-time tech players that are Disney subsidiaries: THX (audio and video), Skywalker Sound, Pixar animation, Disney Digital Services, Disney Games, Marvel Games, and Disney Imagineering.

It seems far-fetched, but in reality a merger with Apple is a natural fit, considering "so much of Disney is located at the same intersection of Technology and the Liberal Arts that Apple calls home." :

Apple buying Disney isn't the fairy tale it once was

When you're as big as Apple, you need to get creative in order to seek growth.

www.macworld.com

Bob would sell today if the offer was there

…because he’s failing and has no way out otherwise except another pathetic “retirement”

 

[John park hopper]

If Disney is a failing company maybe they should start by drastically cutting the salary and benefits package of Bob and all the higher ups.

 

[Sirwalterraleigh]

If Disney is a failing company maybe they should start by drastically cutting the salary and benefits package of Bob and all the higher ups.

That wouldn’t move the bar much

 

[John park hopper]

That wouldn’t move the bar much

A penny saved is a penny earned --it's a start--attributed to Ben Franklin but never said it

 

[Sirwalterraleigh]

A penny saved is a penny earned --it's a start--attributed to Ben Franklin but never said it

Executive compensation in a public company is a problem…but not the main issue

Dividends and stock buybacks create much more bad management decisions

 

[ᗩLᘿᑕ ✨ ᗩζᗩᗰ]

Bob would sell today if the offer was there

…because he’s failing and has no way out otherwise except another pathetic “retirement”

It's all Bob knows. Buy and Sell. Anything short of that and he's clearly out of his depths.

 

[Lilofan]

If Disney is a failing company maybe they should start by drastically cutting the salary and benefits package of Bob and all the higher ups.

In a sense it happens. A $30M salary and bonus may be cut in half.

 

[ohioguy]

Bob would sell today if the offer was there

…because he’s failing and has no way out otherwise except another pathetic “retirement”

Who says it's not? Watch the financial press, which seems to be leaking stories like this to drum up response. Tim Cook would be an excellent choice to replace Bob Iger, regardless.

 

[el_super]

Apple would gain not just the extensive Disney catalog for their streaming and entertainment divisions, but also quite a few big-time tech players that are Disney subsidiaries

This still doesn't make sense to me. Not now.

Apple wouldn't be just buying Disney catalogue, they would be buying up competing streaming services. Apple owning Disney+ doesn't change the math at all on the value of those services. No different than Disney owning Hulu.

Would Apple shut down Apple TV and rebrand everything under Disney+ or drop Disney+ and put all their content on Apple branding? Or would they just try to bundle everything together and double the cost? Do the Shrinking viewers subsidize Ashoka or vice versa?

 

[Lilofan]

Who says it's not? Watch the financial press, which seems to be leaking stories like this to drum up response. Tim Cook would be an excellent choice to replace Bob Iger, regardless.

Tim Cook who moved some Apple operations from China to cheaper labor costs Vietnam and India ? If running Disney then Disney merch may be made in those countries too.

 

[LeighM]

I remember when many started bashing Michael Eisner for his changes. Bob Iger left on a high note then covid and Bob Chapek happened. I saw articles questioning whether Iger would be able to keep goodwill considering the decisions he would need to make to save the company. Now many are complaining about Iger (when before they didn't want him to leave) and wanting Eisner to come back lol. I don't really think people would be talking bad about Iger if the world hadn't been changed by covid. I think most corporate leaders are in a newer territory and the rule book might've been thrown out the window. I think that's where Chapek failed the most. He's such a strict numbers man that he couldn't read the room when it came to covid and didn't know how to adjust. I think most people expected Disney to one day charge for FastPass. That writing was on the wall a while ago. But I think they all underestimated the blowback from fans who were already cooped up from covid, under a lot of stress and pressure with kids schooling and working from home, loved ones sick and dying, worried about their job, inflation and then Disney (the happy place for Disney fans) making changes that stress their checking account and making it more difficult to vacation. It was just really bad timing, I think.

 

[ohioguy]

Tim Cook who moved some Apple operations from China to cheaper labor costs Vietnam and India ? If running Disney then Disney merch may be made in those countries too.

Big business will always attempt to look for the cheaper labor cost, especially at scale.

 

[Sirwalterraleigh]

I remember when many started bashing Michael Eisner for his changes. Bob Iger left on a high note then covid and Bob Chapek happened. I saw articles questioning whether Iger would be able to keep goodwill considering the decisions he would need to make to save the company. Now many are complaining about Iger (when before they didn't want him to leave) and wanting Eisner to come back lol. I don't really think people would be talking bad about Iger if the world hadn't been changed by covid. I think most corporate leaders are in a newer territory and the rule book might've been thrown out the window. I think that's where Chapek failed the most. He's such a strict numbers man that he couldn't read the room when it came to covid and didn't know how to adjust. I think most people expected Disney to one day charge for FastPass. That writing was on the wall a while ago. But I think they all underestimated the blowback from fans who were already cooped up from covid, under a lot of stress and pressure with kids schooling and working from home, loved ones sick and dying, worried about their job, inflation and then Disney (the happy place for Disney fans) making changes that stress their checking account and making it more difficult to vacation. It was just really bad timing, I think.

I think it was all that…

…but also couple with the longterm strategy running out of runway on the bobs.
What they thought was “sustainable” was never going to be.

 

[Sirwalterraleigh]

Who says it's not? Watch the financial press, which seems to be leaking stories like this to drum up response. Tim Cook would be an excellent choice to replace Bob Iger, regardless.

Honestly?

Only a few that hang around “neighborhoods” such as this…

Who can’t separate their life at home in the real world from where they choose to vacation…which are not intertwined to the level their emotions tell them.

The financials are in agreement: Disney is in some serious trouble and Bob is at ground zero

The question is it “transitional”? Or is there something that has or is happening that’s really causing a decay of their place in their market?

If it’s the latter…the lions share of blame (100%) is straight up on Bob.

The price of being a business “dictator”…no one to blame

 

[Tha Realest]

If there’s any common theme here, it’s that Disney / Iger was slow (by like 18-24 months) to work on getting ahead of the curve on these things. They could’ve had Netflix for a pittance years ago and now that company’s valued more than Disney. They finally got into the gambling space by…taking over Barstool’s licensing arrangement? It seems they jump feet first into this stuff too late.

 

[flynnibus]

If there’s any common theme here, it’s that Disney / Iger was slow (by like 18-24 months) to work on getting ahead of the curve on these things. They could’ve had Netflix for a pittance years ago and now that company’s valued more than Disney. They finally got into the gambling space by…taking over Barstool’s licensing arrangement? It seems they jump feet first into this stuff too late.

Such is the curse of the incumbent when it comes to large markets. You want to protect your gravy train so you are slow/resistant to roll out alternative formats. You can buy disrputors to clean the field… but you are always going to be lethargic to push in the direction they started because you have an existing money engine. It takes a pivot - which usually is too risky of being too early.

The gambling thing is just a concession to not get made redundant. Eventually the sportsbooks are going to have their own espn-type of news distribution and shows. Disney does not want to be on a moral island while the rest of the market has already moved on. It’s still bot going to be a major company wide initiative. It’s just a reactive move to keep the espn brand alive in today’s market.