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Disney is looking to join the free streaming channel boom as newly named CEO Josh D’Amaro doubles down on streaming as one of two key pillars to drive future growth.
During Disney’s quarterly earnings call, D’Amaro confirmed
that Disney is considering launching FAST channels as a means of expanding its streaming advertising industry and for free services to become a “funnel” for consumers to sign on for Disney+, Hulu and other subscription services.
D’Amaro was vocal during the investor call on his views that streaming is the future for the company, along with the parks and experiences division.
“We see it as a way to expand our reach to a customer segment that’s more price sensitive, and expanding our reach is as we’ve talked about before one of our strategic priorities,” D’Amaro told investors early Wednesday. “Unlike a lot of our AVOD competitors, we’re fairly well sold, meaning more inventory would actually help us accelerate our ad revenue growth. And then finally, as a free offering could help us drive top of funnel Disney+ subscriber growth. So nothing specific to announce today, but definitely something that we’re considering.”
D’Amaro was pressed on whether Disney has done the long-term analysis on whether the Disney+/Hulu model of direct-to-consumer subscription is a better business overall for shareholders than the traditional model of producing movies and TV shows that were licensed to internal and external networks. D’Amaro emphasized the importance of Disney+ as a “global touchpoint” for consumers that complements the data that Disney uniquely enjoys through its theme parks and cruise ships.
D’Amaro addressed the question that many analysts have posed about whether Disney+ and Hulu can keep up the subscriber growth that Disney needs to justify its more than $24 billion investment in content.
“We we strongly believe that a large global user base is strategic to ensuring that we’re able to drive longer term growth, especially as new technology cycles emerge, like AI and the consumer touch points that our streaming platforms provide,” D’Amaro said. “They give us a global user base to communicate with, and importantly, a critical first-party data set that will enable personalization and continued product innovation. And it establishes a foundation that we can build revenue streams on top of over time. This is only possible through a direct-to-consumer relationship inside a wholly controlled and branded environment, as we look to make Disney+ the I’ve said this before the digital centerpiece of our relationships with fans. We’re just playing a different game.”
More to come
