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Disney is significantly reducing its spending on traditional TV content, according to CEO Iger
Disney chief claims that the company initially overinvested in streaming content, leading to volume rather than quality.
Disney CEO Bob Iger declared a plan to decrease funding in traditional TV networks for entertainment and concentrate on streaming services, as reported by Variety. This decision is intended to enhance customer participation and increase profits, overseeing both traditional and streaming platforms through a single leadership.
Dana Walden will be in charge of overseeing entertainment content, while Jimmy Pitaro will handle the sports content. Although Disney will continue to invest in traditional television sectors, there will be a greater emphasis on streaming platforms such as ABC, Disney Channel, and National Geographic.
Iger stressed the significance of efficiently managing expenses and boosting profits, even with the anticipated decline in network subscribers. Disney's bold strategy in 2019 resulted in financial losses, causing a shift towards prioritising quality over quantity.
The company's goal now is to increase involvement by merging Hulu and including ESPN content on Disney+ in order to decrease customer attrition. Initiatives to limit unauthorised sharing of passwords will be rolled out slowly beginning in June.
Disney aims to improve interaction through AI technology to provide personalised content experiences. ESPN is set to offer a personalised "SportsCenter" tailored to individual user preferences in the near future. CEO Iger did not address particular sports rights talks but highlighted the strategic management of rights.
Disney's streaming services achieved their initial profit in Q1 of 2024, even though the direct-to-consumer division, which includes ESPN+, continued to operate at a loss. Disney's goal is to become profitable in streaming by the third quarter of 2024. Even though theme park revenue was high, Disney's stock decreased because of poor guidance and a decline in the TV business.
Theme park business will be impacted by one-time costs during the June and September quarters. Disney predicts that their operating income will increase by a mid-to-high single-digit percentage in Q3 and by double digits in Q4. Iger was reelected following a proxy battle during the annual shareholders meeting.