by Thinus Ferreira
Disney CEO Bob Iger on Thursday said that The Walt Disney Company made too many shows for its Disney+ video streaming service diluting the impact of its content and that the Mouse House would consider selling off its linear Disney TV channels which are no longer considered part of its "core" business since that part of the business is broken.
Speaking to CNBC during a sit-down interview on the sidelines of an Allen & Co. session in Sun Valley, Idaho in the United States as part of the larger Sun Valley Conference, Iger on Thursday admitted that Disney over-extended its creative forces in ramping up content for Disney+ causing the quality of its film output from its various studios to suffer.
Disney has seen several of its films flop at the box office in the past few months, from Marvel's Ant-Man and the Wasp: Quantumania and the live-action remake of The Little Mermaid, to Elemental and the disappointing opening of Indiana Jones and the Dial of Destiny.
Bob Iger noted that "there have been some disappointments. We would have liked some of our more recent releases to perform better. In our zeal to basically grow our content significantly to serve our streaming offerings, we ended up taxing our people in terms of their time and their focus way beyond where they had been".
"Marvel is a great example of that. They had not been in the TV business in any significant level. Not only did they increase their movie output but they ended up making a number of television series, and frankly it diluted focus and intention."
"There were three Pixar releases that went direct to streaming, mostly because of Covid," Iger said, referring to Soul, Luca and Turning Red. "I think it may have created an expectation under the audience that they're eventually going to be on streaming, and probably quickly, and there wasn't an urgency."
"You have to agree that there were some creative misses as well," Iger said.
Disney: Linear TV channels broken
Bob Iger also spoke about the ongoing deterioration and unravelling of linear broadcast television and the traditional pay-TV channel business which he calls "broken".
Disney owns and runs TV channels ranging from the ABC broadcast network in the United States, to pay-TV channels like The Disney Channel, National Geographic and ESPN distributed globally to and carried by pay-TV operators in South Africa like MultiChoice's DStv and StarTimes Media SA's StarSat.
"The disruption of the traditional television business is most notable," Iger said when asked about the big challenges facing Disney. "The disruption of that business has happened to a greater extent than what even I was aware".
Iger said that Disney will look at and consider potentially selling something like ABC, as well as its Disney pay-TV channels "which may no longer be core" to the overall business, but will keep ESPN and look for strategic partners when it transitions ESPN to streaming.
About ESPN he said it's "not necessarily about spinning ESPN off, but about looking for strategic partners that could either help us with distribution or content but we want to stay in the sports business."
"There is an inevitability in taking ESPN direct-to-consumer [streaming]; we haven't said when but we do know that it will happen."
About ABC, National Geographic and the other Disney channels, Bob Iger said "We're going to be expansive".
"We have to be objective and open-minded about the future of those businesses."
"They may not be core to Disney. There's clearly creativity and content that they create that is core to Disney but the distribution model, the business model that forms the underpinning of that business - to deliver great profits over the years - is definitely broken. And we have to call it like it is - and that's part of the transformative work we're doing."
"One of the things that I discovered when I came back is that one of the disruptive forces that have been preying on that business for a while is greater than I thought. It's eye-opening. There is a reality to it that we have to come to grips with and we have to come to grips with that now."
