Walt Disney is reconsidering licensing its films and television shows to rivals after years of pushing resources into growing its Disney+ steaming service, CEO Bob Iger said on March 9.
Iger made the comments at the Morgan Stanley Technology, Media, and Telecom Conference in San Francisco where he noted that the increased licensing of Disney’s content library to other media outlets could be on the cards if the Burbank, California-based entertainment giant reaches a point where it needs less content for its own platforms.
The CEO said that the company could embrace a more curated HBO-like approach of making a few high-quality shows built around its major brands, as he works to boost profit at Disney+.
“For a while, that was something we couldn’t possibly do because we were so favoring our own streaming platforms. But if we get to a point where we need less content for these platforms, and we still have the capacity of producing that content, why not use it to grow revenue? And that’s what we will likely do,” he added.
Disney Reports Disappointing Results
Iger noted at Thursday’s conference that Matt Groening’s “The Simpsons” and Seth MacFarlane’s “Family Guy” draw an “extraordinary” number of viewers both on Disney-owned Hulu, as well as on the Roku streaming service.“Over 3.5 billion hours of that content consumed on Hulu ... So that suggests that there are opportunities to license the content to others first,” he said.
“As the Simpsons has done, the Simpsons, there are over 33 episodes of the Simpsons on Disney+, and it’s one of the more popular programs on Disney+, yet it’s — they’ve all been on the FOX network. So that’s, I think, interesting learning for us that you can still put the product on that does extremely well in streaming but that is — were driving more revenue with a balanced model of licensing to third parties and streaming to ourselves.”
Iger returned to Disney in November, less than a year after he retired, replacing successor Bob Chapek who stepped down from the role.
His return came shortly after Disney posted disappointing results for its fiscal fourth quarter, showing declining advertising sales and added costs for streaming programming.
Job Cuts
Shares of the entertainment giant fell more than 40 percent in 2022.The entertainment company had hoped his return and a change in its streaming strategy would bolster investor confidence and improve profits at its streaming media unit while returning decision-making power to creative executives.
Last month, Iger revealed that around 7,000 employees would be laid off as part of the entertainment firm’s bid to save $5.5 billion in costs, with $3 billion coming from content and $2.5 billion from non-content areas.
“This reorganization will result in a more cost-effective, coordinated, and streamlined approach to our operations, and we are committed to running our business more efficiently, especially in a challenging economic environment,” Iger said during an earnings call.
Prior to the job cuts, the company has already frozen new hiring, and Iger said that the entertainment giant must also “return creativity to the center of the company, increase accountability, improve results, and ensure the quality of our content and experiences.”
The job cuts saw shares of the company jump nearly 10 percent.
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