November 12, 2019

Should Disney Be Broken Up Before They Destroy Movies?

It's difficult to avoid Disney's dominance. But is it too late to ever break the conglomerate up?

No Film School readers are savvy media consumers, so I'm sure we already know that when it comes to media production and distribution, Disney as a company owns just about everything. They've got studios, networks, theme parks, music, digital marketing companies, and more. If you need it, here's a refresher on all the companies Disney now owns.

And as of Nov. 12, Disney+ has officially rolled out, throwing the media giant even further into the streaming game, too. (They own Hulu already.)

But do they really need all this power?

That's a question author Matt Stoller asked when he published an essay on Nov. 5 proposing a break-up of Disney.

The whole piece is a really interesting read, but here are the main takeaways. Prepare to feel frustrated and learn why you should care why Disney controls what you get to watch.

How it all started

Stoller first acknowledges the importance and impact of TV and film, not only as entertainment, but as tools of education and preserving history. This is one reason he finds the consolidation of so much media under Disney so concerning -- why should one company be able to dictate how we tell stories and reflect our society?

He goes back to the time of Michael Eisner, who became CEO of Disney in 1984. He raised the prices of theme park tickets and bought ABC/ESPN.

Then, in 2005, Bob Iger took over the company. Under Iger, Disney acquired Lucasfilm, Marvel, Pixar, BAMTech, and 21st Century Fox. Iger has also made the Chinese market a major focus for the film division.

Stoller calls this new company "Imperial Disney," and says it "is more a private equity group than studio, collecting brands and using them to bargain aggressively with partners, suppliers, and consumers."

Bob Iger
Credit: Josh Hallett

What does Iger want?

Stoller recently read Iger's book, The Ride of a Lifetime, and uses it to characterize the former TV weatherman-turned-CEO as someone who seems to want power more than anything. Iger seems to look down on Disney's culture (he dislikes coworkers' tacky Mickey Mouse ties, or wearing Disney apparel to the work place, for example) and purposefully shifted the company's goals toward acquisition, technology, and global reach.

Iger also wants Disney to be a company of control.

Here's just one example. Since acquiring Fox, the company has pulled many classic Fox movies from circulation, so theatres can't show films like Alien or The Princess Bride. This is a tactic they've used in the past with Disney animated and live-action movies that only occasionally come out of the "Disney vault."

Don't miss your "last chance" to own this movie! It's going back into the Disney vault! They're simply creating demand by withholding product.

In October, American Prospect writer Brett Heinz pointed out that the "acquisition of Fox means that the Walt Disney Company now owns one in seven of all films to ever receive a Best Picture nod."

That's bonkers.

What about new films? Heinz also wrote:

Disney shows some signs of producing more output now that they’ve acquired Fox, planning to release 18 movies next year (though this number is likely to be lowered as some films are shelved or pushed back). But of those, at most half appear to be original scripts or new films based on books, while the other half consists of remakes, sequels, spin-offs, Marvel movies, and one tie-in to boost the profitability of a Disneyland attraction. Looking back at 2000, sequels and re-issues made up less than a quarter of the 21 films Disney released. Welcome to Monopoly Disney.

Disney and movie theatres

Not only does Disney now own a huge back catalogue with restricted-to-no access, they can also force theatres to comply with aggressive first-run terms for new releases. More aggressive than previously used by the studio. 

Movie theatres are struggling in today's market, where audiences can just as easily stay home to watch the newest movie. They need the new Star Wars or MCU movie to make money. And Disney knows that.

According to the Wall Street Journal, when The Last Jedi came out, Disney demanded 65 percent of ticket revenue from the film and ordered theatres to show the movie "in their largest auditorium for at least four weeks.” If they didn't comply? Disney could take another 5 percent. 

Disney is also strong-arming theatres through "block booking," forcing them to show their less popular movies in exchange for access to bigger films -- like Star Wars. An example of this happened recently to Alamo Drafthouse. Sources have told us that Alamo Drafthouse was told if they wanted Fox Searchlight release (and awards contender) JoJo Rabbit, they would have to book October's Maleficent sequel -- a movie audiences, and its own studio, treated with a collective shoulder shrug. 

"Block booking is technically illegal under an old antitrust precedent," writes Stoller. "But, well…"

Bob Iger and George Lucas

Why should we care?

The short version is if you love movies, and you love original content, you should be worried.

As cool as the idea for Disney+  might be, this is a platform that controls a product from conception to distribution. Sure, they'll have analytics and numbers that will tell them what audience members are watching what. But they're only going to be getting those numbers from their subscriber base, not the world at large.

Disney is going to simply be churning out content they think their audience wants. Subscribers will be paying for it already. It won't matter if it's good, or new.

As Stoller writes:

A subscription service based on monopoly power breaks this entire process. Netflix, for instance, pretends to have fancy algorithms to determine quality, but it’s not clear that they have figured out a good quality filter superior to the price system. [...] Disney is likely to lose its filmmaking edge; indeed, it is already so large and has so many brands that the bad remake of films like The Lion King do suggest a loss of creativity. Such a loss will not matter to Disney the corporation, because it will have distributive power to compensate, but it will matter to all of us who love movies, and those who make them, and to the societies all over the world who use film and art to make sense of the world.

What can we do?

Stoller is hopeful. Monopolies have been stopped before. He writes that controlling Disney "will likely require vertical and horizontal restrictions, and addressing problems with the abuse of copyright protections to leverage additional market power."

Even though it's probably an uphill battle, we can also support independent theatres and independent distributors.

And keep creating original content.

But if you absolutely need to know what's going to be on Disney+, we've got that covered, too.     

Your Comment

9 Comments

Great article! I think Disney is starting to approach antitrust territory, similarly to when studios also owned the movie theaters that showed their movies.

November 12, 2019 at 5:14PM

6
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K W
665

starting? that ship has sailed when the FOX merger was approved.

November 19, 2019 at 3:28AM

1
Reply

If what the mouse has done to Star Wars is any indication, woe to all.

November 12, 2019 at 5:41PM

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chip brandstetter
Filmmaker, Editor, Animator, Sound Design, Composer
278

This is a stupid article pushing a futile fantasy. Want to preserve cinema? Destroy all video games and the internet. No? Maybe a better tactic is to leverage streaming to introduce young viewers to better content, while also utilizing social media to promote cinema going as a lifestyle. Break up the cinema chains instead, they're the ones narrowing the range that gets shown - more independent cinemas will more likely result in a broader range of titles screening.

November 12, 2019 at 5:48PM

2
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eric wadsworth
Director, Storyboard artist, VFX artist.
148

go to an independent cinema and a chain cinema. Look at the number of people through the door on a given week. The numbers matter. Range is important but we don't want to abolish the BlockBuster and the big hit entertainment, which for the masses is all that gets them out to the cinemas. We need cinema to be a big and impressive experience.

In many cases, if you look at it, the cinema experience itself is pushing more and more towards a theme park like experience with bigger seats, bigger sound, bigger screens, self serve expensive amenities and an overall scale to everything. This is not at all conjusive to have a good experience watching something like The Farewell, or even The Irishman but it is the best way to watch a BLOCKBUSTER and it is the only way the cinemas can get people there in the scale they need.

Home entertainment systems have gotten so good with 85 inch screens and whatnot that they experience for many people needs to be so big and impressive to warrant leaving the couch.

Their does need to be a mix of chain and independent cinemas or ideally chains breaking off their own independent chain like a Fox Searchlight or Miramax style cinema. Which Disney ironically shut down both of them. But like an AMC Independent brand marketed to an older or more sophisticated crowd but with the reach and backing of a larger brand could change the game!!

November 12, 2019 at 11:28PM

2
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avatar
Isaac Elliott
Director - Producer
273

I have been thinking about this since they bought 20th Century Fox.
To me, I think THAT was Iger's biggest mistake.
In the end, it just might be the thing that could ruin everything he has.
Disney should be broken up. Why? This is the only way to save the studio from itself.

November 12, 2019 at 10:08PM, Edited November 12, 10:08PM

0
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Disney should never have been allowed to acquire 20th Century Fox. Antitrust action in this country is dead. In addition, the studio has gotten so PC that it's destroying its legacy through revisionist editing. Major case in point: the new dumbO release. Disney had a grand chance to educate people about black music with a special feature but no, they chose the PC easy way out: just drop the whole significant scene. So, with or without their gorilla footprint, they're full on destroying movies anyway. I think we can safely call Disney the studio of "fake movies".

November 15, 2019 at 2:59PM, Edited November 15, 3:07PM

1
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Disney won't destroy the movies, but rather themselves - and since that's a good thing, I'd like them to go on like they did!

November 19, 2019 at 3:00AM

1
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DingDong
1932

Disney is looking into killing theaters. They just want to do everything through their streaming service. This way, they control everything, just like they did before 1949's supreme court decision that took distribution out of Hollywood's hands.

November 19, 2019 at 5:19AM

0
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Eugenia Loli
Filmmaker, illustrator, collage artist
74