The bad news keeps piling up for Disney with no end in sight.
Hopes of a major turnaround appear bleaker than ever.
And Disney’s CEO was a nervous wreck after he got some bad news he never expected.
Disney’s streaming service is counting on advertising
Disney is betting the future of the company on its streaming service Disney Plus.
The company is reportedly considering selling off ABC and its cable networks like ESPN.
Disney Plus lost more than $11 billion over the six years since its launch but Disney reported it turned a small profit this year for the first time.
The growth in Disney Plus subscribers has come from consumers choosing the cheaper plan which has ads.
Disney CEO Bob Iger revealed that 60% of new subscribers are picking the ad-supported Disney Plus plan during an earnings call with investors.
The streaming service had another price hike this year which helped Disney’s bottom line.
“It’s not just about raising pricing. It’s about moving consumers to the advertiser-supported side of the streaming platform,” Iger said. “The pricing that we recently put into place, which is increased pricing, was designed to move more people in the AVOD [Advertising-based Video on Demand] direction.”
Disney is counting on advertising revenue, but one insider claimed the entertainment powerhouse could be in big trouble.
Advertisers reportedly fleeing Disney Plus after Star Wars flops
An anonymous advertising executive who uses the name Kiss My Grits (KMG) claimed that advertisers were leaving the ad-supported Disney Plus plan during an appearance on the Valliant Renegade YouTube channel.
“The ad tier subscription numbers are nowhere near what they assumed they were going to get,” KMG said.
KMG revealed that Disney was underdelivering what it promised advertisers for impressions on Disney Plus.
“So they’re under-delivering by vast amounts on several of the campaigns that are running on that platform,” KMG explained. “And as a result of what is happening the advertisers are obviously not very happy. And so they are pulling money from those campaigns. They’re saying, ‘All right if you’re not meeting the delivery that you promised me, I’m placing that money elsewhere.’”
The advertising executive accused Disney of hiding its advertising revenue from streaming which is a sign it is less than expected.
Disney Plus has had some big budget flops that have viewers looking to change the channel.
The woke Star Wars series The Acolyte was a costly flop for Disney that was canceled after one season.
Series creator Leslye Headland touted it as the “gayest Star Wars” during the run-up to its release.
The Acolyte featured lesbian watches and made the beloved droid R2D2 gay.
Disney spent more than $230 million on the eight-episode first season which predictably bombed with audiences.
The Lucasfilm series Willow based on the 1988 movie of the same name was also canceled after a single season.
Disney CEO Bob Iger’s hope that the ad-supported Disney Plus plans are the company’s salvation could be in big trouble heading into the New Year.
DeSantis Daily will keep you up-to-date on any new developments in this story.
