By Michael Briggin
Walt Disney Studios these days has an identity problem and it’s not clear what it’s true brand is anymore.
After taking over the 15-year rein of Bob Iger’s leadership, new CEO Bob Chapek had this to say at a recent Disney Board of Directors meeting:
“Now we have a distribution system so to be able to take that content and take it directly to all of you without necessarily having to go through a third party that somewhat limits what we can do. I have never been more excited.”
According to Q4 and 4th Year Earnings for Fiscal 2020, Disney+ has more than 73 million subscribers. Months prior to 2020, Disney+ had significantly less subscribers.
However, Disney+ isn’t so much a new idea but more of the same: Adapting to the times to profit. In the past few decades, Disney has gradually shifted away from being strictly an innovation studio and more about strictly being profitable in all means – Even if this meant going against the management style of Walt Disney himself.
Here’s a timeline of significant decisions made by Disney in the last several decades:
- August 1995 – Disney acquires ABC News.
- January 2006 – Disney acquires Pixar Studios.
- August 2009 – Disney acquires Marvel Enterprises, the comic entertainment production studio started by Marvel Entertainment Group, incorporated 1986 and which has featured many comic book films.
- December 2012 – Disney acquires George Lucas’ empire, including Lucasfilm (with LucasArts shutting down).
- February 2014 – Disney launches its own startup accelerator, the Disney Accelerator.
- March 2018 – Disney announces a strategic reorganization of the company’s direct-to-consumer services, technology and international media operations into a single, worldwide business to capitalize on growth opportunities.
- March 2019 – Disney acquires 20th Century Fox Studios, including its art house film distributor Fox Searchlight Pictures (now Searchlight Pictures).
Since taking ownership of the Star Wars franchise, films financed and distributed by Disney have resulted in a mixed success. Marvel Enterprise comic book films, although more consistently profitable than the Disney Star Wars films, are based off the Marvel brand, not Disney.
The last blockbuster-grossing animated film Disney produced on its own without any help from companies it acquired was the Lion King. To date, the 1994 film has grossed $422 million in the U.S. Box Office ($835 million adjusted to inflation as of 2020).
While the disruptive digital economy is increasingly more influential than traditional exhibition models, staying the course with Disney+ doesn’t assure the company it will be able to sustain revenue like this in the long-term.
In order to generate revenue in the long-term, Disney needs to maintain its trademark brand: Animated films and musicals but ones that can be profitable and be timeless. Additionally, new innovations need to be more than just what other Hollywood studios are inventing.
Is innovation becoming a challenge for your organization? Are your challenges similar to Disney’s?