Finance

Iger: Disney DTC App Will Include Star Wars, Marvel

Disney chief says direct-to-consumer offerings akin to iTunes, offering individual and packaged programming 9/07/2017 12:39 PM Eastern

About a month after announcing plans to offer two direct-to-consumer offerings tied to its ESPN and Disney brands, Walt Disney Co. chairman and CEO Robert Iger offered more details on the products, including the inclusion of its Star Wars and Marvel films in the Disney-branded app, slated for a late 2019 release.

Disney announced plans for the DTC offering in early August. The content giant plans to launch a direct-to-consumer ESPN app in spring 2018 and a Disney app in late 2019. When it was first unveiled, Disney said the ESPN offering would include about 10,000 games, including contests from Major League Baseball, Major League Soccer and colleges that are not currently aired on its ESPN linear channels. The Disney app would include content not shown on its linear Disney Channel, but will have archive movies that are currently part of its output deal with Netflix, which is slated to expire in 2019. http://www.multichannel.com/news/content/disney-set-launch-direct-consumer-services/414481

When it announced the DTC initiatives, Iger said it hadn’t been determined whether its Star Wars and Marvel franchises would be included in the app. Now they will, in addition to other original content.

“We’ve now decided to put the Marvel and Star Wars movies on this app as well,” Iger said at the Bank of America Merrill Lynch media conference in Los Angeles Thursday. “It will have the entire output of the studio – animation, live action and Disney, including Pixar, Star Wars and all the Marvel films. In addition to that we have been spending a fair amount of time developing original content on the movie side for the app. The studio is already dev and will produce four-to-five original films exclusively for the app, primarily live-action.”

He added that its studio library product will be available, about 400-to-500 films, and on the TV side it will create 4-to-5 Disney branded TV series and 3-to-4 TV movies for the app. Television library content also will be available.    

Pricing for either app hasn’t been released yet, but the Disney chief said it could be announced for the ESPN app by the first of the year.

Iger, said he envisions the direct-to-consumer products to offer content much like Apple’s ITunes music service to offer a customized experience.

“Think of what ITunes is,” Iger said. “Where you will be able to go to the platform and actually buy, almost  on an a la carte basis, a sport, a sporting event, a season, a league, maybe a conference as a for instance. You'll be able to pick and choose over time what it is you want, it won't necessarily be a one-size fits all. We may launch it that way, but the goal eventually is to create something that a sports fan can essentially use to design what their sport media experience can be.”

Iger also addressed ESPN’s slipping subscriber base, adding that while there has been some decline, he still believes the network and other Disney properties will negotiate from a position of strength in upcoming carriage renewals. Iger said that he is currently negotiating with one large distributor – he didn’t identify it – and said that more than 50% of its subscriber base comes up for renewal by the end of 2019.

Iger said that despite worries over declining ratings across the industry, live sports is still strong and ESPN’s rights are deep and “quite attractive.”

“As we enter a new cycle of extensions with traditional distributors, we are well positioned,” Iger said. “We intend to drive significant value in those negotiations, I think you have to look at it as a blend of distribution and price. We intend to use the strong hand that we have and the brands that we have as we negotiate these new deals.”        

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