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Disney Will Try More Releases Like “Mulan”

Charging a premium for early access to big-budget movies on Disney+ looks like an idea with staying power.

Media powerhouse Walt Disney (NYSE:DIS) has been forced to try out some new ideas in 2020. The COVID-19 pandemic closed down movie theaters for several months and Disney kicked a lot of planned movie releases over into 2021. The company also skipped movie theaters altogether for a couple of important titles. The live-action remake of Mulan was perhaps the most daring experiment, premiering directly on the Disney+ streaming service with a $30 premium surcharge for the first three months.

The Mulan experiment was a success. In last week’s fourth-quarter earnings call, Disney CEO Bob Chapek pondered the future of premium video on demand (PVDO) releases. It turns out that Chapek likes the idea of using the PVOD release model again.

Fantastic growth

First of all, streaming video services have already claimed an important role in Disney’s long-term business plans. The company reported 120.6 million total subscribers to its video-streaming services in the fourth quarter, up from 101.5 million accounts in the third quarter and just 32 million names in the year-ago period. Streaming subscription fees accounted for $3.25 billion of Disney’s top-line revenues in this quarter. That works out to 22% of Disney’s total sales for that quarter, up from 8% a year earlier, which was just before the launch of Disney+.

Disney+ added 16.2 million new subscribers during the quarter and it’s safe to say that some of these additions…

Anders Bylund

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