This morning, I walked into my kitchen to have breakfast, and when I opened my fridge, I noticed something very unusual. The bag of apples I purchased was branded with Disney characters all over it.
To catch you up quickly, streaming revenue is down, the acquisition of Fox has stretched them thin, ESPN is for sale, the theme park business is trying to bounce back after COVID-19, and linear TV has sunk below streaming.
Disney Is Huge. Many Say It Might Be Too Big To Fail
If you're Bob Iger, you're sitting back and trying to figure out how to right the ship and make sure one of the most famous brands in the world stays on top.
But what is the answer is not keeping Disney together but cutting it in half?
Moffett Nathanson analyst Michael Nathanson asked Iger this question on an earnings call last week, saying, "Given the thinking you've done about the future of Disney, why doesn't it make sense to create two Disney companies: one focused on parks, Disney+ and then the studio IP that drives that flywheel, and then one on everything else? So why not make a clean break?"
Iger replied, "I'm not going to comment on the future structure of the company or the asset makeup of the company. As I've said, we're looking at strategic options both for ESPN and for the linear networks, obviously addressing all of the challenges that those businesses are facing."
What’s the Scope of What Disney Is Facing?
Well, you have dozens of businesses and network all churning out different goals. ESPN is now involved with a sports gambling app.
Parks and experiences are global, with expansion ideas and varying issues.
Streaming (Disney+ and Hulu) is in direct competition with linear TV (ABC and ESPN), and both are not making money. Oh, and they also have cable networks like FX to deal with as well. they have Pixar, Disney animation, Disney Studios, 20th Century Fox, Marvel Studios, Star Wars, and much more, all looking to figure out what to put out and how they can claw back to dominance.
There are dozens of other fronts Disney is facing, not even in the entertainment industry's purview, so I'm not even mentioning them here.
Splitting up into different companies that focus on different things might allow places to address problems without internal conflicts and give CEOs the power to dial in on specifics that can make each of these branches flourish.
It's clear Disney would probably like to keep everything in one company, but there's so much going on, you have to ask, "Who's looking after the apples?"
There's no answer.
Let me know what you think in the comments.
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