Disney’s Pivot to Streaming Won’t Change Hollywood

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When you’re the highest-grossing studio in Hollywood, it’s hard to imagine you wouldn’t always want to do the thing that you’re immensely good at: making movies and showing them in theaters. And yet, it’s 2020 and nothing is predictable, and as such, this week Disney announced plans to—for lack of a better way to put it—pivot to streaming, a move that could shift the entire landscape for movie and TV distribution.

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Or maybe not. You see, under Disney’s new plan, the company says it is looking to streamline its direct-to-consumer business by enlisting a new division, the Media and Entertainment Distribution group, to decide how the content made by its studios—Pixar, Lucasfilm, Marvel, etc.—goes out into the world. Some of those studio offerings will still go to theaters, of course, but CEO Bob Chapek told CNBC this week, “We are tilting the scale pretty dramatically [toward streaming].” It’s a bold move, and one that shows just how big an impact outfits like Netflix have made on Hollywood. But it’s not a move that every other studio is likely to mimic, nor should they. Why? They’re not Disney.

Reading Monday’s news about the new plan at the Mouse House, the first thing that sprung to my mind was my colleague Brian Barrett’s story about the 2019 launch of the company’s streaming service. Titled “Disney+ Is Here—and It’s a Fully Formed Streaming Juggernaut,” the piece laid out all the ways the company was entering the streaming wars with a much larger regiment than any of its competitors. Not only does Disney have a back catalog of animated family classics as well as Star Wars and an entire superhero team, it also has Fox, ESPN, and National Geographic. Apple TV+ didn’t have anything close to that when it launched. HBO Max had the Home Box Office coffers, as well as those of WarnerMedia—including Friends—when it went live, but even those offerings seem paltry compared to everything at Disney’s fingertips.

It’s this agility, brought to bear by sheer volume, that Disney has in spades. Sure, other studios could shuffle more of their presumed theatrical releases into streaming (see the success NBCUniversal had with sending Trolls World Tour straight to VOD), but with theaters remaining closed because of concerns over Covid-19, most have opted to push back their release dates. Disney delayed some of its superhero tentpoles like Black Widow, but it had no problem dropping Mulan on Disney+ and is making plans to debut Pixar’s new movie, Soul, on the streaming service as well. At the time, Mulan‘s release was seen as a one-off, and not an ideal release for the film, but it was a reminder that Disney can burn off a title here and there and still remain ahead. Movies produced by the studio accounted for some 33 percent of the total US box office in 2019—38 percent if you include movies from Fox, which Disney acquired that year. The company’s closest competitor, Warner Bros., only accounted for about 14 percent of that same market. Add in the fact that its big franchises have huge pipelines of projects in the works, and it’s easy to see how Disney could shift a few more titles to streaming and still stay ahead of it competitors. Conversely, considering that Warner Bros. needed two movies—Joker and It Chapter Two—to add up to the box office take of one Lion King, it’s also easy to see why any studio not named Disney would be reticent to send any of its features straight to streaming.

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