The Walt Disney Company is shaking things up in the media universe, with CEO Robert A. Iger announcing a series of moves yesterday that he characterized as “an extremely important, very, very significant strategic shift.”
“In short order, Disney announced that it was moving from a minority to a majority ownership stake in BamTech (the tech side of MLB Advanced Media, and a major infrastructure engine for the over-the-top video business); that it was withdrawing its entire television and motion picture library from Netflix; and that it would be launching not one but two OTT streaming services, an entertainment-focused one with Disney and Pixar content and another for sports enthusiasts under the ESPN banner,” Forbes reports.
While the Twittersphere blew up over the announcements, Forbes notes that it will take a while for the impact of the moves to be known. “The Disney moves leave us all with many more questions than answers about what the future of television and the media landscape will look like,” the story reports, noting that it may be premature to declare an end to multichannel video.
With the name recognition of both the Disney brand and ESPN, Forbes notes, “Disney likely has an ability to ‘go it alone’ in a way that few if any media companies or brands could match.”
The report adds: “Certainly, there is a clear and present danger for the legacy big bundle approach when 10,000 different sports events can be found on the new ESPN OTT service, and Disney and Pixar movies and new, exclusive Disney content on the entertainment platform. But what if some multichannel video providers (MVPDs) flipped the script? With ESPN and Disney content available for superfans on a stand-alone basis, might some emboldened MVPDs believe they could do without this content, or at least provide tiers without it? It might keep inside the MVPD tent those non-sports fans with concerns about sports-driven costs.”
Disney has lost some money from cord cutting consumers. It will be significantly more if the cord cutters become the cable and satellite companies. As great as their assets are, can they recoup their current losses with an independent delivery system of their own?
ESPN is one of the reasons I cut the cord years ago. I found I was paying $6 a month of my cable bill for ESPN and it’s other little nets, but I never, ever, watched any of it, nor did I have the option to cut ESPN from my cable service.
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I’m sure that Disney has decided that they would rather get $10 a month directly from the consumer for ESPN sports networks, rather than a few bucks from a cable bill with membership that keeps dwindling. And then, they can also get another $10 a month for all of the Disney channels, from those folks who like sports and have kids, or from the folks who don’t like sports and have kids.
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I can’t imagine anyone who has children NOT subscribing to Disney’s OTT service. At least, not subscribing AND staying sane.