Walt Disney Co (NYSE:DIS) announced recently that is has developed a new business unit for its streaming video and global businesses as it focuses on the direct-to-consumer and international platforms. The company has adjusted its traditional media operation to embrace the rapidly changing online video products.
The company stated that it’s strategically positioning its businesses for future endeavors by developing a more effective and global framework that can serve its customers worldwide, improve its earnings, increase growth and enhance the shareholder value. The firm is responding to the market changes in its digital endeavors. For instance, the company plans to pull its first-run movies from Netflix to stream them on the Disney-branded service by 2019.
Kevin Mayer, Chief Strategy Officer, Disney, who was recently appointed the chairman of the new division will oversee the introduction of the new products and services including the upcoming ESPN+ online offering and a Disney-branded streaming service. The company promised to commence reporting its financial performance under the new structure by the beginning of 2019.
ESPN, the largest Disney’s TV network has been losing its subscribers as there is a shift of customers’ dropping the pay-TV subscriptions in support of the direct streaming services such as the Netflix.
The move is part of the company’s strategy to expand its business. The company is also planning to acquire film, TV and other global businesses from its Twenty-First Century Fox. For instance, the firm is currently negotiating a deal to buy off Comcast assets.
Disney will also combine its theme park entity with the consumer products unit that deals with licensing of toys, apparel, and other merchandise. At the same time, the media networks and movie studio will still remain separate entities. Disney’s new streaming service will directly compete with Netflix.
According to Bob Iger, CEO of Disney, the reorganization would help the company to deliver on its promise especially in the entertainment and sports content for all its consumers across the world who will have more choice, customized and convenient services than ever before.