Disney will be entering the streaming service competition by launching Disney+ later this year. While we can expect to see all sorts of content under the studio’s umbrella, which consists of Disney, Lucasfilm, Marvel Studios, and Pixar, it wasn’t clear how much money was being put into it.
Now new reports say that the studio is spending somewhere north of $500 million on original television shows like The Mandalorian and films like Lady and the Tramp. More on this below.
Variety did a deep dive into Disney’s plans to compete in the streaming business. According to RBC Capital Markets senior media analyst Steven Cahall, the company will devote about $500 million to original programming for Disney+ in 2019. According to Cahall:
“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.”
Original content will include shows like Jon Favreau’s The Mandalorian starring Pedro Pascal. Additionally, Diego Luna will return to reprise his role as Cassian Andor in a Rogue One prequel series.
On the Marvel side of things, we can expect to see shows based on Loki, Scarlet Witch and Vision, and The Falcon and Winter Soldier.
But films will also be a big part of the Disney+ line up. According to the report, projects will have a budget ranging from $20 million to $60 million. So far we know that the company will be offering live-action adaptations of animated classics like Lady and the Tramp and The Sword in the Stone. Other films include Three Men and a Baby, Don Quixote, and Noelle.
Despite all of that original content and access to almost an unlimited amount of titles, Disney CEO Bob Iger says that there are no plans to compete with other streaming giants like Netflix.
And because of Disney’s acquisition of Fox, which was approved last year, the company has access to even more content from Fox, Fox Searchlight, FX, and National Geographic.
While there is a lot to look forward to in terms of what Disney+ will be offering, Variety says there are a lot of challenges that the company will have to address to its investors. Namely how much it will spend on content, how much traditional licensing revenue will be lost by keeping more of its content in-house, and when it expects the bottom of that investment cycle to come before a return to growth.
It’s very clear that Disney will spend a large amount of money on development and production of original content. But at the same time, the service’s success will rise or fall largely on the popularity of that original content. That’s because the report reads as though Disney is still trying to figure out some of the logistics of the service before it launches later this year. There are still questions about the deal-making process, as it is unclear how some deals should be made and who pitches should be made to. Additionally, they are still trying to straighten out how Disney’s and Fox’s existing production units in film and TV will be integrated.
We will just have to wait and see how it all pans out when Disney+ launches sometime in late 2019.