Why Is Disney+ Buying Outside Content?

During today’s Investors Conference Call to discuss the Quarterly Financial Results, Disney CEO Bob Iger was answering questions and was asked about the comedy show called “Diary Of A Female President” which was recently revealed to be coming to Disney+ and would be made by CBS Studios.

Bob Iger said they are planning on heavily sourcing content for Disney+ from within Disney, but when it makes sense, they will go to outside companies.  He added that the reason they’ve licensed out for the Disney+ shows is because they need “volume” for the launch of Disney+ and because the Fox purchase hasn’t gone through yet, they don’t have access to content and more importantly the facilities to make new content.

I think the strategy will be long-term pretty heavily weighted to internally sourced versus externally sourced. There will be occasions when we would be glad to license from third parties, but because the Fox deal hasn’t closed yet, so we can’t take advantage of some of their output capabilities and because we need to launch the service with some volume and it takes time to ramp up. We’re buying certain products from the outside opportunistically and we’ll continue to do that.

 

 

By the way, this is something we’ve done in our parks for a long time, where we licensed from George Lucas Star Tours, the “Star Wars” IP or the “Indiana Jones” IP or the “Avatar” IP. We’ll continue to look at opportunities that we think we can leverage because there is a potential consumer demand for them.

One of the biggest assets from the purchase of Fox, is the huge increase in production output that can be obtained since they have talent, equipment and buildings from Fox.

He mentioned they’ve done it in the past and will do it whenever needed.  One recent example is ABC’s Modern Family, which is actually created by Fox.

Disney needs original content for its new streaming platform, but can’t rely on it’s Fox assets until the purchase is done and by going to external providers, they can not only fill in the voids but also should any issues or delays effect the Fox purchase, they can still continue with the launch.

 




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