Disney Is Making An Enormous Change To Streaming And Consumers Need To Know
Disney reports it's removing a whole lot of content from Disney+.
The House of Mouse is moving on from cutting employees to cutting content. As Deadline reports, Disney appears to be taking a page from rivals Warner Bros. as it prepares to remove a huge chunk of content from its streaming services. The entertainment giant is looking at $1.5 billion to $1.8 billion in content impairment charges and trying desperately to find a way to stop hemorrhaging money.
The information comes from a post-earnings call in which CFO Christine McCarthy laid out Disney’s plan to remove content from streaming to shareholders. McCarthy didn’t specify which content would be removed from Disney+ and Hulu but did say that a review would be completed by the third quarter of the fiscal year, with the chosen content to be removed soon after.
The removal of content isn’t the only trick Disney has up its sleeves to bring costs down. “Going forward, we intend to produce lower volumes of content,” McCarthy stated, calling both approaches a “strategic shift.” CEO Bob Iger also addressed the need to spend less money on fewer movies and shows, stating that Disney needed to get “much more surgical about what we make.”
Iger went on to explain that the company had thrown too much time and money into producing and marketing projects that didn’t add any new subscribers. Shows like Willow and the National Treasure series failed to perform as expected and were axed after only one season. It’s worth noting that at least some of the difficulty Disney faces when marketing shows like Willow is self-inflicted.
Aside from their classic animated films and content created by Pixar, Disney has heavily pushed just two brands for the better part of a decade, Marvel and Star Wars. While it’s understandable that Disney would put most of its effort behind their two most popular IPs, it also leaves much of its non-MCU and non-Jedi content to either sink or swim on its own.
Not that it’s been all smooth sailing for Disney’s biggest two properties, either. Recent lackluster offerings from Marvel like Thor: Love and Thunder and Ant-Man and the Wasp: Quantumania faced lukewarm receptions from critics and audiences and contributed to so-called “superhero fatigue.” Meanwhile, the bulk of the Star Wars content Disney has produced since buying the property from George Lucas has been hit or miss with fans, with some projects like The Last Jedi dividing the fandom right down the middle.
After a glut of original streaming content, Bob Iger wants to shift some of the focus to theatrical films available on Disney’s streaming services. Iger complained that the company is blowing all of its marketing costs on made-for-streaming content and not spending enough money to market theatrical films when they arrive on Disney+ and Hulu.
Iger specifically named Avatar 2, The Little Mermaid, Guardians of the Galaxy Vol. 3, and Pixar’s upcoming Elemental as potential subscription drivers if the company puts enough marketing dollars behind their arrival on streaming.
Ultimately the CEO equated the upcoming changes to Disney’s streaming business model with growing pains. Iger made it clear that he considers Disney’s losses part of the learning process that comes from moving into a new area of business—streaming—that the company had no prior experience with.
“We are learning a lot more about how our content behaves on the service and what customers want,” said Iger. Fans will let the CEO know just how accurate the last part of his statement is when Disney reveals exactly what content it plans to get rid of.
