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Disney, encouraged by early growth in its streaming service Disney+, will lean hard into its streaming business as its other businesses remain considerably stymied by the ongoing Covid-19 pandemic’s effects on in-person entertainment.The first investment, which was announced during Disney’s quarterly earnings call with investors today, comes in the form of the anticipated blockbuster release of Disney’s live-action film Mulan, the theatrical release of which has been pushed back due to continued theater shutdowns. The film will arrive on Disney+ on Sept. 4 and will be available for subscribers to view if they pay a premium fee of $29.99.The extraordinary decision highlights the staying power of a transactional video during the pandemic and is aimed at recapturing some of the investment from the film’s production while also encouraging additional signups for Disney+, which has cleared 60.5 million subscribers as of Aug. 3.  The company had previously told investors that it expected to have between 60 million to 90 million subscribers by 2024.“Obviously things have gone better than expected, and we are growing into momentum here,” said Christine McCarthy, Disney’s senior evp and chief financial officer during its call.The decision to make Mulan available to rent on Disney+ is a “one-off” choice driven by the extraordinary business circumstances from the pandemic, CEO Bob Chapek said, but it is not yet a sign of shifting strategy for theatrical releases. The company will look to learn how the release affects additional Disney+ subscribers and the number of transactions that the offering generates among existing subscribers.“We find it interesting to be able to take a new offering, our premiere access offering, to consumers at that $29.99 price and see what happens from it,” Chapek said.As the Covid-19 pandemic continues wreaking havoc on the media giant’s parks, studio entertainment and advertising businesses, the company is leaning even harder into growing its streaming footprint. Disney is accelerating its expansion into the direct-to-consumer streaming space and plans to debut a general interest streaming service internationally in the 2021 calendar year, Chapek announced.The service will follow the playbook for Disney+ and use much of the streamer’s technology, Chapek said. It will include content from ABC Studios, Fox Television, FX, Freeform, 21st Century Studios and Searchlight and will be integrated more closely into the Disney+ offering in some markets.And while Disney-operated streamer Hulu had previously planned international expansion, this offer will not be branded under the Hulu name. Instead, the upcoming service will debut under the Star brand, which already operates the Disney-owned Hotstar in India. Disney will hold an investor day to discuss the plans in more detail in the coming months.“We see tremendous opportunity in the direct-to-consumer space,” Chapek said. “In light of the success, we’ve achieved thus far with our global direct-to-consumer business and bolstered by our ability to deliver the exceptional brands, franchises and storytelling that consumers around the world have demonstrated a tremendous affinity for, we intend to take full advantage of that opportunity.”The big streaming news helped overshadow another brutal quarter for the remaining parts of Disney’s business, which has been battered by the Covid-19 pandemic’s effects for two quarters. Revenues at the company were down 42% in the quarter overall, largely driven by its parks, experiences and products segment that were walloped by Covid-19 closures, which saw its revenues decline 85%.Studio entertainment, too, was hit hard, reporting 55% less revenue than a year prior. Media networks revenue was down 2%, as lower advertising revenue in the cable networks and broadcast segments were partially offset by a decrease in programming and production costs and marketing spend. Broadcasting revenues were actually up 12% due to those shifts.Continue Reading

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