From the Carousel of Progress to Walt’s ideas on EPCOT, The Walt Disney Company has been interested in technology and innovation from the beginning. Recently, Disney executives spoke at the SVB MoffettNathanson Technology, Media & Telecom Conference and provided updates on everything from Disney+ to the Disney Cruise Line.
The conference shed light on the company’s plans in terms of investing, scaling, and cutting costs. What’s on Disney’s radar? Can we expect any price increases (or decreases)? Let’s find out!
Throughout the conference, Disney CFO Christine McCarthy answered questions regarding The Walt Disney Company’s recent earnings call and how the company plans to invest going forward. One of the first questions McCarthy addressed was, “What actions and decisions are you taking today to improve the Disney company’s financial performance going forward?” Here’s what she had to say.
At Disney’s most recent earnings call, it was revealed that Disney+ Hotstar is losing subscribers. Since then, some investors have expressed their concerns about the future of the Disney+ streaming platform.
In terms of Disney+’s new ad-free tier, McCarthy explained, “We are looking at pricing overall and pricing for the ad-free tier, which is really a premium product, in comparison to the ad-supported product, which is at a much more accessible price for consumers.” During Disney’s recent earnings call, Disney CEO Bob Iger revealed that the company will be raising the price of the ad-free Disney+ tier by the end of the year.
McCarthy went on to add, “We’re looking at optimizing that ad tier,” explaining, “There are some things we want to refine.” In fact, McCarthy pointed out that the Disney+ ad tier is currently only in the U.S., and the Disney+ ad-supported tier will be launching outside the U.S. in the future.
From there, McCarthy went on to comment on what some critics have been saying about Disne’ys decision to cut back on content, saying, “I think I’ve read some commentary of some concern over us cutting back on content, and somehow that’s gonna have a negative impact on our ability to attract or retain new subscribers and existing subscribers, and that’s really not the case; it’s really spending our content dollars to the highest and best use of where they will attract and retain those subscribers.”
Despite the recent loss in subscribers, McCarthy and other executives made a point to clarify that Disney is confident in its plan for the streaming service.
IP in the Disney Parks
Lately, Disney Imagineers have been using more Intellectual Property in the parks both domestically and internationally. McCarthy touched on this strategy, explaining, “We have ways we can use our intellectual property, our franchises, the ones that really resonate with our consumers, and we have more data than we had before.”
McCarthy used the Frozen movie franchise as an example, referencing the past when Disney only had box office data to judge the popularity of its films. “So Frozen was a few years ago; it had tremendous box office performance, we knew it resonated — we had incredibly strong consumer products coming out of that franchise as well. Now, with new franchises and strong IP, we can also incorporate that consumer data to know how deep it is and in what parts of the world it’s most significant in.”
Imagineers and other Disney creatives are now using Disney+ data to help determine what they can (and should) bring to the Disney parks. For example, Disney could look at its newest animated feature on Disney+ and see, “How often are people watching it?” or “Do they watch it multiple times?” to help predict the popularity of a new IP-inspired experience or attraction in the parks.
Specifically, in part, McCarthy stated, “That better informs our creatives and our Imagineers to lean into things that we can really exploit in our theme park businesses.”
McCarthy was also asked to comment on the rising theme park prices, including things like Genie+, food, and theme park tickets. She explained, “One of the things that I’d like to just point out is that we are in an inflationary environment, and the macroeconomic environment we are in, we’re very aware of that,” McCarthy reiterated, “The inflationary impact of day-to-day living is something that we’re very much aware of.”
McCarthy used theme park ticket prices as an example of how inflation impacts pricing, explaining, “When you go back and look at the pricing increases that we have taken in our admission price…they are pretty much around inflation.”
The Writers Strike
Finally, McCarthy briefly referenced the ongoing Writers Guild of America strike, which may, in part, impact Disney’s total cash content spending budget.
Variety reported that McCarthy also recently attended a conference in New York, where the company presented to ad buyers and brands. The presentation, “was noticeably light on scripted fare, given the writers strike.”
In reference to Disney’s recent spending cuts, McCarthy stated, “We are well on our way to meeting or exceeding the 2.5 billion of SG & A savings that we put out to the market previously.”
The conference covered a LOT, but in the end, both McCarthy and Disney president of ad sales Rita Ferro were optimistic, saying, “We have better days ahead.” As Disney lovers, we sure hope so! In the meantime, we’re always on the lookout for the latest Disney news, so stay tuned for more.
NEWS: PRICE INCREASE Announced for Disney+
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The post The Future of Disney Parks: Brace Yourself for an Influx of Disney Movie Characters first appeared on the disney food blog.