Disney says its 'primary focus' for entertainment is streaming

[Frank Cox]

https://www.cnbc.com/2020/10/12/disn...-consumer.html

• Disney is restructuring its media and entertainment divisions.
• In order to further accelerate its direct-to-consumer strategy, the company will be centralizing its media businesses into a single organization that will be responsible for content distribution, ad sales and Disney+.
• The change comes as the global coronavirus pandemic has crippled its theatrical business and ushered more customers toward its streaming options.

Disney is restructuring its media and entertainment divisions, as streaming becomes the most important facet of the company's media business.

On Monday, the company revealed that in order to further accelerate its direct-to-consumer strategy, it would be centralizing its media businesses into a single organization that will be responsible for content distribution, ad sales and Disney+.

Shares of the company jumped more than 5% during after-hours trading following the announcement.

The move by Disney comes as the global coronavirus pandemic has crippled its theatrical business and ushered more customers toward its streaming options. As of August, Disney has 100 million paid subscribers across its streaming offerings, more than half of whom are subscribers to Disney+.

[Mike Blakesley]

Well actually the words "primary focus" never appear in the article.

It just says that they are consolidating a bunch of departments. That's nothing new, they're always doing that. They create a new department to handle some new thing, and then once it gets going, they fold that into some other department. Remember when "Walt Disney Home Video" used to be a big separate arm of Disney?

[Leo Enticknap]

It does say "accelerate its direct-to-consumer strategy," which, IMHO is effectively the same thing. That could include buying or building theaters though, now that the Paramount Decrees are no more.

[Bobby Henderson]

Hell, considering what has been happening in the retail space, it could mean getting rid of physical movie disc sales. But I don't know how concentrating everything into streaming is going to generate more money for them. I don't have any desire to spend $30 just to stream a "premium VOD" movie on my TV set. I think the main draw for most people to streaming is it costs less. It's a lot cheaper to sign up for a couple streaming services than pay a lot more for cable TV. It costs less to pick from a set number of choices on Netflix than it does to rent one movie at a time, particularly if you're going to actually drive to a video store still in business and get a physical disc.

Physical movie disc sales have cratered for a few reasons. One is that it's rare to see a new Blu-ray or UHD release that's had a solid effort put into it; many releases are pretty much bare bones discs. DVDs from 20 years ago seem amazing by comparison. I think another reason is many of us have disc shelves, book cases and boxes full of discs we hardly touch anymore. They're just gathering dust. I can't remember the last movie disc I bought. Chances are it was an older catalog title. It seems clear to me the movie studios are getting ready to completely abandon the physical retail channels and just sell movies virtually in download style direct to the consumer. Cut Walmart and others out of the deal. That's probably why Disney's stock price received a good bump on this news.

There is still an outside chance Disney may start opening theaters under its own brand, and maybe even to show its own content exclusively too. But I suspect Disney could try to wait for months or even years to give existing theater chains enough of a chance to die off and then they would consider moving in afterward. Amazon, Netflix and Google could upend that plan, if they want to bother with theaters.

[Marcel Birgelen]

I still buy hard-copied versions of movies on Blu-Ray and RIP them, in case someone stops producing Blu-Ray readers... It's still the best possible quality you can get as a mere mortal, short from some digital intermediate or the DCP version and far superior from any streaming offering. Even though most Blu-Rays nowadays are mostly bare-bones releases, I like the fact that I own a copy and I can decide when and where to watch.

Once movies start to become a streaming-only affair, skipping the theatrical release entirely, I'm official done with it. I've put zero efforts into watching Mulan, for example and I'm not even planning to do so, even once it appears in the normal subscription tier of Disney+.

It's an odd world. We're creating more data than ever before, but I have the feeling we're keeping less and less for the generations beyond us.

[Leo Enticknap]

And then there's the censorship risk. Once content is no longer sold to consumers on physical media, the owners of the streaming platforms have total control over what we are and are not allowed to watch. We've already started to see this happen, when one of the streaming content providers removed the most infamous episode of Fawlty Towers (warning: offensive language at the end of this link). The BBC will now only broadcast repeats of it with this scene cut. I'm surprised that the clip is still on YouTube. If you didn't buy the DVD, it is likely, IMHO, that this episode will be impossible to see within a year or two. It's mainly for this reason that if ever there is any content that I wish to retain access to long term, I buy it on physical media if I can.

[Steve Guttag]

Care to watch Song of the South?

[Leo Enticknap]

If I did, I could order a DVD of it from Japan (where the copyright has expired, and the movie is easily available). If there were a similar movie released today - relatively uncontroversial when originally made, but within two generations became controversial to the point at which the copyright owner wishes to prevent all access to it - and never on physical media, the copyright owner's attempts to suppress all access would likely be a lot more successful than they have been with Song of the South.

Vaguely related to which, Amazon Prime removed The Dukes of Hazzard from its streaming service for a few weeks earlier this year. They put them back again after a few weeks, I suspect because they feared that streaming sales would collapse if people started to get the idea that content they have bought could suddenly be pulled. But that proved what could be done if we don't have access to content (not just movies, but especially books as well) in physical form any more.

[Marcel Birgelen]

It all reminds me of that ironical incident a year or ten ago, where Amazon pulled the e-book version of 1984 from several people who bought it on Kindle...

Also, in about 50 years, those of us that are still around or those of us that came after us will be we're happy that some of us actually kept physical copies of some of the stuff out there. We know how good Hollywood is at preserving their own history...

[Randy Stankey]

It does say "accelerate its direct-to-consumer strategy," which, IMHO is effectively the same thing.

It says, "accelerate."

That means "to increase speed" of something that's already happening.

It's been happening for a long time, now. A lot longer than most people think or would believe. Ten or even twenty years, IMO. Maybe more.

By that, I don't mean that people thought, "Some day..." No, I mean that this has been a gradual plan that people have been acting out, little by little. They make film cheaper and crappier. They make projectors and equipment cheaper and crappier. They manipulate markets in such a way that theaters have to use cheaper and crappier labor in order to stay financially afloat. All of these things degrade the end product at movie theaters so that customers think it's better to stay at home and watch on TV.

Then, they dangle the hook of digital projection in front of theater owners, making all these promises that it will be cheaper and better, only half of which ever came true at all. They offer financial incentives for theater owners to dump tens of thousands of dollars worth of perfectly good equipment into the trash and buy new equipment that costs hundreds of thousands. Just when theater owners think they have this new system working, they pull the financial incentives and decree that theaters will have to upgrade all of the equipment that they just bought a few years ago. (Where film projectors last for decades and digital projectors last for a decade or so, at best.)

Do I think that some cabal of studio executives sit in a smoke filled room, somewhere, and dream up plans to destroy movie theaters? No.

I do think, however, that the movie industry has found itself on this track, partially by happenstance and partially by plan, then some slick-thinking executives "accelerated" that train to the point where it is, today.

Basically, this COVID outbreak is just the excuse that studio executives were waiting for to "drop the axe", so to speak, and kill off movie theaters for good, or, at least, cripple them to the point where they won't have to deal with them, anymore.

Now that studios have all the digital infrastructure necessary to make and distribute movies digitally, all they have to do is "flip the switch" and theaters will be out of the picture.

COVID is just that excuse to flip that switch.

This news story is just a bowl of "word salad" that means, "We're going to flip the switch, now."

[Rick Glaus]

I am no genius but when they bought Fox you knew this was coming. The circuits that could have raised objections even if they had done no good they all sat back with the yes master can I have another. Amc jumps in bed with Universal and today they announced they may run out of money by years end. I do not think it was not a master plan just a lot of inept management with no backbone that allowed this to take place. Say what you want about Redstone I recalled in the 80's when he had a problem with a studio he would just not play their picture for a year or so until he got what he thought was a reasonable deal for his theatre. Today no-one would think of doing something like that. I believe if it comes to the point exhibition becomes a ghost of what it is today most of the upper level executives will move on to screw up some other industry they know nothing about

[Marcel Birgelen]

I think buying Fox will come to haunt Disney. A lot of diversity was lost in that acquisition. The strategy to bypass theaters and go for a streaming-only strategy will eventually hurt their bottom line, as will it hurt the bottom line of the rest of the industry.

Unfortunately, there is no denying that movie theaters of all sizes are going to face some challenging times in the coming months and probably in the coming years. It will not just be AMC who will be running out of money...

Still, the undoing of Hollywood as we knew it was already happening for years. While Hollywood kept producing movies at breakneck pace right until the epidemic struck, the amount of original content and general quality was already eroded to an almost historical low.

Yet, there are still people with ideas out there and there are people willing to finance those ideas. The problem is that they don't necessarily always meet, but eventually they will. From there, new studios with new ideas and new content will emerge. Some of them will also (re)discover the value of theatrical releases.

Maybe, he demise of Hollywood as we knew it will take the multiplex with it, but the death of the multiplex may give rise to the rediscovery of an almost lost form of cinema. The form of cinema that makes going to the movie something special again.

[Frank Cox]

I've seen several articles pointing out the fact that the big movie companies don't make low or modest budget movies any more. They figure three, four or five blockbusters each year is enough and the smaller stuff is either done by the independent producers (who can't manage a promotional campaign to match the majors) or just isn't made at all. Low budget stuff goes on TV, medium budget stuff doesn't get made, and blockbusters go into the theatre. So now that they're afraid to release the blockbusters to the theatres for fear of losing their money, there's no moderate budget stuff to fill in the gaps.

[Bobby Henderson]

I'm under the impression movie studio executives and their global media parent company bosses believe there is an almost unlimited amount of money to be made with streaming. They don't appear to see any drawbacks to throwing everything at the home viewing environment.

Do these guys not realize there is a lot of different things competing for a viewer's attention in the home?

We have a multitude of competing streaming services. Not only that, but there's still traditional forms of pay TV. Game consoles are going through another generational leap this fall. And then we have the smart phones, tablets and notebooks connected to the Internet. Multi-tasking is common. For example, I'm typing this statement on my notebook computer while sitting in the living room watching the local newscast on TV.

Even if a viewer (or group of viewers) isn't distracted from the movie by some other device there is always a good chance the pause or stop button will be hit before the movie has finished playing.

A home is not an optimal environment for movie watching or pretty much any other kind of activity that requires 100% of your attention for an extended period of time. One reason we visit movie theaters is to escape the distractions in our home. I have a gym membership for the same reason; trying to work out at home absolutely sucks.

[John Eickhof]

it looks to me lthat once they feel the instant gratification of the instant cash flow of streaming, all bets are off, no more distribution nightmares, no waiting for the big chains to pay their rentals, and of course...no more 'in theatre piracy' issues !!! a big win win win for the money grubbers that replaced the film people in hollywood and to hell with the exhibitor that made them rich !