Four years after acquiring 21st Century Fox, it seems that Disney is preparing to shed some of its assets. This is due to the “broken” landscape of linear TV—something that Disney CEO Bob Iger discusses in a new interview with CNBC.
In the interview, Bob Iger concedes that the “disruption of the traditional TV business” is more challenging than he initially believed. While many of Disney’s core assets (Pixar, Marvel, Lucasfilm) have found a solid foothold in the streaming world, assets like NatGeo and FX are still knee-deep in the linear TV business.
Iger hopes to be “objective” about the future of these linear TV assets. And, when pressed by CNBC, he noted that these channels “may not be core” to Disney as a business. While Iger hasn’t shared a plan for the future, Disney is considering some structural changes, and it’s searching for partners who may be interested in acquiring a piece of the pie.
Presumably, Disney will sell a partial stake in some of these assets, which are still quite valuable. The distribution model of linear TV is Iger’s sticking point—he maintains that these linear TV channels still create great content. (Bob Iger also notes that ESPN is an outlier, as sports is the last remaining force in the traditional TV distribution model. However, ESPN will switch to a streaming model in the next few years.)
This restructuring is part of a larger change within Disney. The company hopes to reduce its annual spending by $5.5 billion. It’s hiring far fewer employees (it may also lay off some employees), and notably, it’s trying to rectify the mistakes it made when pushing into the streaming market. For example, Bob Iger is dissatisfied with some of the “creative misses” made by Pixar in recent years, and he believes that Marvel’s increased output led to a “diluted focus” at the studio.
In other words, Disney will be “spending less on what we make and making less.” It may also sell some of its stake in linear TV companies. If all goes right, this will cut costs and increase the quality of Disney’s products. (I should clarify that Disney leading the box office this year. The corporation is doing fine, it just wants to do even better.)
These changes will affect Disney’s streaming services. The output of studio like Pixar and Marvel will slow a bit. To be clear, Disney+ and Hulu are already shedding some content, so this isn’t some strange thing that’ll happen in the future. It’s already underway, albeit slowly.
