• Uncategorized
  • 0

What Disney+’s profitability strategy means for Marvel and Star Wars

What Disney+’s profitability strategy means for Marvel and Star Wars

In his first town hall since returning to Disney as CEO, Bob Iger addressed the future of the company, including his focus on profitability for its streaming outlet Disney+. Still, with the exception of Netflix, all the major streaming services are likely to operate at significant losses.

The world sees Disney as the company with “all the money,” in part because of Iger’s 10-year quest to acquire other massive companies. Without his acquisitions of Marvel, Muppets, Lucasfilm and 20th Century Fox, Disney+ would likely be even less profitable. Strange world, a film seemingly tailor-made for Disney+, released theatrically with little marketing support. The film is now Disney’s biggest flop ever. Iger helped push for streaming, but these releases could hurt the box office, at least with Marvel. The pandemic effect has not gone away. Theaters “need” Disney content more than the streamer does. However, don’t expect a content purge like on HBO Max. In Iger’s first statement as returning CEO, he reaffirmed a commitment to the idea that Disney’s first business is “storytelling.”

RELATED: Why Marvel’s Complex Namor and Hulk Rights Mean They’ll Never Get Solo Movies

Chasing subscribers did not lead to profitability for Disney+

Netflix and Disney Pinocchio movies

Making Disney+ profitable should be easy, especially for a studio with nearly a century of content to draw from. With over 160 million subscribers, Disney+ is probably the second biggest in the game. Netflix, the top dog, launched its streaming service in 2007. It didn’t reach 150 million subscribers until 2019, just before the Streaming Wars began in earnest. Of course, Disney, Warner Bros. had to and Paramount spend too much to compete. So Netflix can make about $15 million from Glass Onion: A Knives Out Mysterya movie with an estimated budget of $45 million with marketing and call it a hit.

Strange world grossed $28 million against a roughly $200 million marketing budget, so despite earning more than Glass onions, it is undoubtedly a flop. While it seems more like a project fit for the streamer, spending $200 million on a streaming-only product is still a risky proposition for investors. It is he who is driving the restructuring that brought Iger back into the corporate fold. Still, when the $200 million goes to something like She-Hulk or The Mandalorianit’s a reasonable expense for a service that should bring in annual gross revenue in the double-digit billions.

A focus on profitability for Disney+ is likely more of a threat to non-franchise originals, such as the Marvel-adjacent series Limitless with Chris Hemsworth. If the number of subscribers continues to grow or at least does not decline, it may be easier to make Disney+ profitable than investors think.

RELATED: Scarlett Johansson’s Black Widow lawsuit doomed Bob Chapek’s Disney career

Expect more specials from Marvel and Star Wars animated series in the future


What neither investors nor company executives want to say out loud is how an individual title contributes to the overall value of a streaming service is more mysterious than not. Investors understand the one-to-one relationship between film budget and box office gross. In the immediate future, fans can expect more animation and likely more Marvel Studios one-hour specials Star Wars functions. If only because viewers are more likely to roll the dice on 60 minutes of entertainment than invest in a new series, especially longer ones like Andor or She-Hulk: Lawyer.

The longest of all major Disney+ originals with 12 episodes, Andor found an audience very slowly. Is it better or worse if a series doesn’t hit in the first week or find an audience over time? Shifting focus from series to short features allows for mid-budget experimentation Werewolf at night. Any that become big hits are likely to get sequels or even the acclaimed series order. Also, a series of animated series that were in the works before Bob Iger left is set to debut. Disney+ could go back to releasing just one new thing at a time, using the animated series to cover any cutbacks in live-action originals.

Iger believes in the big budget that has become the hallmark of the Disney brand. But if the once and future CEO trusts the creatives who come up with the stories he believes so strongly in, there shouldn’t be a shortage of stories. Only what form these stories will ultimately take is subject to change.

Source: Variety, Deadline

See also  The menu's cheeseburger and ending explained

You may also like...

Leave a Reply

Your email address will not be published. Required fields are marked *