Disney just announced major changes to the way they’ll release content in the future. The good news is that your Disney+ subscription is only going to get better. The bad news is that movie theaters may not survive.
Late Monday evening–specifically, after the markets closed–Disney announced a corporate restructure that puts the focus on streaming. Like every other business during the pandemic (except Zoom, I guess), the Walt Disney Company has been hurting. Their revenue is split between the parks, merchandise, television and basic cable, the global box office, and their streaming platform.
I’ll give you three guesses as to which one of those revenue streams is still flowing–and the first two don’t count.
Before the pandemic, Disney absolutely dominated the box office. After all, they own the biggest IPs on the planet, with Star Wars, Marvel, Pixar, and, of course, Disney itself. The House of Mouse has fine-tuned the art of the blockbuster and reliably makes over a billion dollars with each new release. But with many American theaters closed until 2021, there are no blocks to bust.
We guessed that their decision to release Mulan as a premium rental on Disney+ was a kind of weather balloon. It must have gone well, because Disney no longer considers theatrical releases to be necessary. In fact, theaters are but one of the “legacy platforms” they’ll consider for distributing content. Their restructure emphasizes streaming first and everything else second.
Disney CEO Bob Chapek, who took over from Bob Iger earlier this year, said that the pandemic “accelerated the rate at which we made this transition.” Chapek continued, “This transition was going to happen anyway.”
“[We want to] make the optimal decision for the company, as opposed to somehow have it predetermined that a movie is destined for theaters or that a TV show is destined for ABC,” Bob Chapek explained.
What that means is that, for the foreseeable future, Disney is likely to stick with the Mulan model for their major films. American (and possibly European) audiences will get a PVOD, or “Premium Video on Demand,” release on Disney+. China and other parts of Asia will get a theatrical release since cinemas are open there.
With 100+ million subscribers, Disney+ is now the 3rd largest platform. They lag behind Netflix and Amazon, but since the company owns Hulu, too, Disney has a significant share of the streaming market. Streaming is almost certainly the way of the future.
Those who bemoan the loss of theaters sound a lot like the people who prefer print to eBooks. The format may be superior in a lot of ways… but audiences will usually choose the cheapest, most convenient option.
In 2021, when it’s (hopefully) safe to open again, theaters won’t look the same. There are a few ways that the post-pandemic movie-going landscape could emerge. In the most extreme case, all the movie theaters close and we simply watch everything on streaming. It’s also possible that the big theater chains–that’s AMC and Regal in America–will go bankrupt, leaving smaller chains and independent cinemas with a chance to thrive.
In this movie geek’s opinion, here’s what will happen. The two biggest chains won’t survive the extended closure of the pandemic. They’ll sell some (if not all) of their brick-and-mortar locations directly to studios. Maybe Netflix or Amazon will buy their own theaters, too.
There will be more “event” style releases and re-releases. We’ll see Doctor Strange in the Multiverse of Madness in a Disney-owned IMAX theater, while the small art-house theaters will run indie films. Everything will be available on streaming, and movie parties where friends chip in a few bucks to rent the latest new release will become the norm.
Honestly, that doesn’t sound so bad.