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Disney Estimated To Spend $500 Million On Disney Plus Programming
New reports suggest that Disney will spend up to $500 million on programming for its upcoming streaming service, Disney Plus. Details on the marketing and development plans for the service have recently been coming to light, with the years-in-the-making Disney/Fox acquisition nearly a done deal. Despite legislative and shareholder concerns similar to the ones that came out of the AT&T/Time Warner merger, and rival bids from Comcast, the Disney/Fox deal is expected to be completed this March. For long-time Disney boss Bob Iger, Disney Plus is the next big move in maintaining the House of Mouse's entertainment empire.
Despite years of lucrative licensing deals between Disney and the global streaming powerhouse Netflix, relations between between the two quietly began to disintegrate in recent history. The long-floating rumors that Disney's collection of animated classics would be added to Netflix never made it to fruition, and Disney eventually withdrew from a 2016 exclusive rights deal with Netflix involving Marvel, Lucasfilm, Pixar, and Disney. In 2017, the launch of Disney Plus was announced, which some have speculated led to the recent cancellation of several Netflix Original Marvel TV series. Netflix has continued to move forward with its focus on original content, upping their investments by billions and raising subscription fees in the process. For now, it looks like Disney Plus will go a different route when it comes to divvying up their content investments.
Market research now predicts that Disney will spend roughly $500 million on Disney Plus original programming in 2019. Disney is expected to spend about $23.8 billion total on content, compared to the projected $14 billion to be spent by Netflix, according to RBC Capital Markets. Senior media analyst Steven Cahall spoke to Variety:
“Disney spends more on content than anyone else globally. It has decades of experience in making excellent content, it has a huge balance sheet with low leverage and it’s a brand that’s known the world over.”
Disney has also reportedly planned an investors presentation in April, as well as a preview of Disney Plus and its coming content. Recent rumors indicted that Disney Plus original series would be given budgets up to $100 million dollars, which would apply to projects like the planned Falcon and Winter Soldier series and Star Wars' The Mandalorian. Last August, Iger implied that Disney's strategy for maximizing the weight of the Marvel and Lucasfilm brands was first creating quality shows, rather than trying to compete with Netflix's expansive library of originals:
“We have the luxury of programming this product with programs from those brands or derived from those brands, which obviously creates a demand and gives us the ability to not necessarily be in the volume game, but to be in the quality game.”
Iger's comments back up the theory that the long-term reward for an investment as big as Disney Plus will be at least partially contingent on the Marvel and Lucasfilm brands retaining their influence on wide demographics of audiences. However, concerns that over-saturation of superhero content may result in a decline in interest in the MCU characters post-Avengers: Endgame have been raised. The mixed reception to Star Wars: The Last Jedi created a group of franchise detractors, and Solo: A Star Wars Story resulted in lukewarm box office returns. Netflix has spent years cultivating a successful strategy of hand-picking compelling and diverse series like Stranger Things, House of Cards, and The Crown. The question is, how long could it take for Disney Plus to catch up?
