The notion of Disney contemplating the potential separation of its conventional TV networks gained substantial traction during the company’s quarterly financial briefing.
Despite the ongoing profitability of Disney’s broadcast and cable entities – encompassing ABC, Disney Channel and its affiliated channels, Freeform, FX, and Nat Geo – CEO Bob Iger articulated during Wednesday’s earnings conference that the corporation is actively examining “an array of strategic alternatives” for these networks. While ESPN is also a constituent of the linear portfolio, Iger underscored that although Disney is actively delving into prospects concerning its sports television division, the corporation desires to uphold authority over ESPN, even in collaborative ventures with other associates.
“While the financial performance of linear TV remains robust, the trends propelled by cord-cutting are glaringly apparent,” mentioned Iger. Consequently, he indicated that Disney would meticulously scrutinize its available courses of action. In the last quarter, linear networks amassed $6.69 billion in revenue and $1.89 billion in earnings, representing a 7 percent and 23 percent reduction, respectively, compared to the previous year’s corresponding phase.
Iger’s assertions on Wednesday build upon his remarks during a CNBC interview on July 13, wherein he suggested that linear networks might not remain central to Disney’s operations, given the company’s ongoing emphasis on streaming endeavors.
However, the CEO did acknowledge that divesting from traditional TV platforms could also impact the streaming sector. This is because ABC, FX, and Freeform programs are readily available for next-day streaming on Hulu. Furthermore, FX exclusively produces several series for Hulu’s platform.
“Undoubtedly, if any significant shifts in our strategic orientation for linear networks are contemplated, we must be mindful of content provisioning for our direct-to-consumer enterprise, particularly via Hulu,” articulated Iger. “Any strategic steps taken would be aligned with the progression of our growth engine, which is the realm of streaming.”
The hypothetical sale of linear networks is also anticipated to introduce certain logistical complexities, albeit challenges that Iger assures could be effectively managed.
