one of hollywood's recent breakout stars
isn't some up-and-coming actor
actually he isn't even human it's this
little guy
baby yoda or that's what fans named the
childlike alien from the hit disney plus
show
the mandalorian instantly memeable the
little green character helped make
disney's new show
and its new streaming platform a smash
hit
since launching in november 2019 disney
plus has surged to the upper echelon of
the crowded streaming ranks
with 37 million subscribers in the us
and over 86 million globally
its success has marked a bright spot for
disney a company that has lost
a little bit of magic in the mandalorian
characters go to great lengths and take
a few risks
to keep baby yoda safe
and in many ways disney has made similar
moves to help its nascent streaming
platform
thrive baby yoda might have been a new
character
but the universe he lives in wasn't new
at all disney
owns the star wars franchise it's one of
the many well-known brands the company
packed into its disney plus streaming
catalog
wsj's eric schwartzel has been following
disney plus growth
the mandalorian has been the breakout
hit of disney plus and it's no surprise
because
it combines a known entity the star wars
universe
arguably the most successful franchise
in hollywood history
with a new storyline that you can only
see and explore
on disney plus disney plus offered 500
films and over 7 500 tv episodes at
launch
they had this stable of brands that they
could already draw on
plus they had movies and characters that
people wanted to watch again and again
so if disney plus became the exclusive
home
of the iron man movies and the finding
nemo movies
that was already a built-in advantage
then they were able to use those brands
and characters to make sequels and
reboots
that become events on the service and
give them
this perfect bridge of new material
using
older familiar characters this helped
garner 10 million subscribers on its
first day
with the mandalorian driving buzz and
acclaim this
overnight success couldn't have come at
a better time for disney
even before the pandemic investors had
questioned disney's long-term growth
potential
disney plus was viewed as a critical
venture to help the company capitalize
on digital entertainment
but with so many streaming options
crowding the space the platform wasn't a
surefire bet
here's former disney ceo and current
executive chairman bob
iger speaking to wsj in 2019
this is a dramatic shift in the way
people consume
entertainment and information your
business is going through the same thing
right
and it requires an immediate shift
in strategy in order to stay
healthy in order to thrive investors
were looking at companies like netflix
and seeing those
as companies where there was a lot of
growth whereas disney
despite ruling the box office and having
theme parks that had to turn people away
they were so popular had a major issue
with cord cutting
this cord cutting was felt most by
disney-owned cable network espn
and as cable subscriptions fell disney
stock price became more volatile
wall street wanted to see a strategy for
growth and a strategy for the future
and that is what led executives to
conceive of disney plus
and launch it in 2019 so when the
pandemic hit with disney shuttering
theme parks
and no theaters open to screen movies
its share price took a dive
with people staying home revenue shrunk
and disney plus quickly became more
important to the company's bottom line
without those traditional revenue
streams disney plus was leaned on even
harder
as a place to look to for investors as
something that might
keep the company afloat and frankly it
has worked incredibly well
so well that disney announced a massive
restructuring of the company
positioning streaming as a top priority
essentially what we want to do
is separate out the folks who make our
wonderful content
based on tremendous franchises from the
decision making in terms of where
the prioritization is in terms of how it
gets commercialized
into the marketplace this included
redirecting high-profile releases like
hamilton and mulan from theaters
onto its platform my name is
alexander hamilton they reorganized the
company in a way
such that there is now an almost
agnosticism
about where a movie or tv show will run
it is more about creating that show
building that programming
and then deciding would this be best in
a theater would this be best on a tv
network would this be best on disney
plus
and increasingly disney plus is the
preferred option
this strategy seems to have energized
wall street despite posting two
consecutive quarters of losses in 2020
including losing over two billion
dollars in its park division
disney stock price has rebounded in
november it announced plans to lay off
32 000 employees by march 2021
mostly in its parks division it also
said it would be suspending its january
dividend to invest more heavily in
streaming
on top of this disney plus set a
projection of 260 million subscribers by
2024
but experts question how realistic this
forecast actually is
a disney spokesperson said in a
statement that with a rapidly expanding
pipeline of exceptional original
programming in the works
the company believes it will
significantly expand its global
subscriber base
what they're trying to do now is figure
out what they can do in terms of pricing
and also what they can do in terms of
international growth because that is
where a lot
of the new subscribers are going to be
coming from there are some challenges
ahead for one
it remains an incredibly competitive
landscape and no one really knows yet
how many streaming services the average
consumer might want to subscribe to
and the other question becomes what is
temporary and what is permanent when it
comes to the way viewing habits have
changed
during the pandemic questions like these
will test whether disney can navigate a
post coronavirus business landscape
and if disney plus can not only be the
most magical but also the most
streamable place on earth