Disney sees big loss as pandemic hits parks and studios
Aug 06 2020
"We are announcing today that in most Disney Plus markets, including the US, Canada, Australia, New Zealand, and a number of countries in Western Europe, we will be offering Disney Plus subscribers the epic adventure "Mulan" on a premiere access basis beginning September 4".
Back in March, right when everything was starting to be delayed and shut down due to the pandemic, I heard that Disney was considering doing some kind of premium tier for Disney+ for their first-run theatrical movies.
The film studio was still a money maker, too, even with theaters closed and new releases on hold, as the valuable Disney library continued to generate revenue from other sources. After widespread of pandemic across the globe, the Walt Disney Company is making big changes to the movie theater industry and AMC Universal.
Across all platforms, Disney now has over 100mln streaming customers and more than 60mln of those signed up to Disney+ following its launch previous year.
The company reported that it had a net loss of almost $5 billion in the third quarter this year. That means all the content will be Disney-owned.
"We see this as an opportunity to bring this incredible film to a broad audience now unable to go to movie theaters, while also further enhancing the value and attractiveness of a Disney+ subscription", CEO Bob Chapek told an earnings call. If Mulan's streaming release proves to be a success, then Disney may very well do the same kind of release for other major blockbusters like Marvel's very first Phase 4 movie, Black Widow. The coronavirus pandemic upended those plans and the film bounced around on the release schedule until the studio pulled it indefinitely last month.
Meanwhile, the announcement of launching Star as a global streaming service was more of a surprise "as we assumed that the financial pain of this current crisis would make Disney more conservative in the near-term", MoffettNathanson's Michael Nathanson wrote in a note to clients. "We are looking at Mulan as one-off as opposed to saying there is some new business windowing model that we are looking at". He said, "We plan to launch worldwide direct to consumer general entertainment offerings under the Star brand in the calendar year 2021".
If you've got a family, that's probably a saving compared to four or five tickets to an actual showing of the movie, which is likely Disney's thinking.
Although around 40% of United Kingdom cinemas are reported to have reopened, many cinemagoers have not returned.