Way back before the launch of Disney+, Disney CEO Bob Iger spoke about how Disney+ would offer the best content from its core brands such as Pixar, Marvel, Star Wars and National Geographic.  Making the streaming service aimed at those who love family-friendly content.  However, while the studios started churning out new shows and films for Disney+, very little seemed to click with audiences, with many of the original programs eventually being removed to save money.

In the years since then, we’ve seen Disney+ evolve, back in 2021, there was a major shift internationally with the addition of the Star hub, which added content from studios such as 20th Century, ABC and FX.  This resulted in Disney+ internationally becoming more of a general streaming platform, and Disney saw the benefits of reduced churn and increased engagement. 

In the US, things are much more complicated due to the existence of ESPN and Hulu.  Both of which are now slowly being incorporated into Disney+.  Hulu On Disney+ launched officially earlier this year, but since Disney still doesn’t fully own Hulu, its only been able to offer it as an add-on through the bundle and later this year, ESPN will become a new hub within Disney+.  Earlier this week, Disney announced ABC News Live would soon be available within Disney+ in the US as well, showcasing how the idea of just having the five core brands and only family-friendly content is no longer the future of the platform.

During a quarterly financial investors call, Bob Iger was asked about Disney+’s vision for the future. He spoke about how the success of its major new releases is driving viewership on the platform.

Let me start by saying that what we’ve been seeing with streaming is significant success, driven largely by the success of our creativity, whether it’s in the television side. The company had 183 Emmy Nominations, for instance, led by shows like Shogun and The Bear and Abbott Elementary and Only Murders in the Building. And I can go on and on. And obviously on top of the television success creatively, we’ve had huge success in the motion picture front recently. And when you look at what the current motion picture lineup drives in terms of value on streaming, it’s profound.

So Inside Out, as it’s in our comments today, the first film has had tremendous consumption since the first trailer for Inside Out 2 launched in November. The same thing is true for the early Deadpool movies, for the early Planet of the Apes movies, I could go on and on.

Bob Iger explained how they are looking to take advantage of its vast collection of brands to try to increase viewership and how that vast selection of content is worthy of people subscribing.

So when we look across our portfolio of IP, and this includes Disney branded, Fox branded, obviously everything that’s on Hulu, programming from FX, programming from ABC, National Geographic, what we’re basically seeing is we’re seeing growth in consumption and the popularity of our offerings, which gives us the pricing leverage that we believe we have. So every time we’ve taken a price increase, we’ve had only modest churn from that. Nothing that we would consider significant. We believe that as we add these new features like the channels that we’re going to be adding later this year that and the success of our movie slate, and I’ll get into that a little bit more, that the pricing leverage that we have is actually increased. We’re not concerned.

One thing that has become very apparent about the growth of Disney+ is that the company is now looking to use more than just the core five brands to bring audiences into the platform, as Bob explained their plans for the future.

The goal is to grow engagement on the platform. And what I mean by that is obviously offering a wider variety of programming, which is why we’re adding news, why we’re adding the ESPN tile to it, while we’re bundling aggressively to give consumers the ability to buy across all of our basically creative engines. And we feel very bullish about the future of this business. We’re not saying much more about it, except you can expect that it’s going to grow nicely in fiscal 2025. The other thing I want to add is that we’ve been talking a lot about adding the technology features that we need to basically make it a higher return, a higher margin business and a more successful business. And we’re doing that right now.

Earlier this year, Bob Iger said he wanted to improve how Disney+ works, copying how other platforms like Netflix showcase their content to audiences through algoriths etc.

We know that we need stronger recommendation engines and we’re working on that technology and we need to make our marketing more efficient. But by adding all of these features, both on the technological side and also on the programming side, we’re bullish about the future of this business.

Roger’s Take: Dsiney+ certainly seems to be in an awkward stage, where it can’t fully take advantage of adding in Hulu until Disney completes its purchase of Hulu from Comcast, and the addition of ESPN is still a way off. It’s clearer that Disney knows it has great content and is continuing to release major theatrical releases, along with hit shows from its general entertainment studios like FX, 20th and ABC, mixing them all together is the key, but its just taking them a long time to actually do it.

What do you think about the future of Disney+? Let me know on social media!

Roger Palmer

Roger has been a Disney fan since he was a kid and this interest has grown over the years. He has visited Disney Parks around the globe and has a vast collection of Disney movies and collectibles. He is the owner of What's On Disney Plus & DisKingdom. Email: Roger@WhatsOnDisneyPlus.com Twitter: Twitter.com/RogPalmerUK Facebook: Facebook.com/rogpalmeruk

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