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Disney Reorganizes to Put Greater Emphasis on DTC

(Image credit: Verizon)

BURBANK, Calif.—The combination of the success of Disney+ with the financial struggles caused by the pandemic is transforming The Walt Disney Company’s direct-to-consumer strategy, as the company announced a reorganization of its media and entertainment business to put a greater focus on developing and producing original content for its streaming platforms.

There will be three distinct groups for creating content—Studios, General Entertainment and Sports. Studios, led by Alan Horn and Alan Bergman, will handle the theatrical and episodic content like Marvel, Star Wars and Disney live action and animation for theatrical, Disney+ and other streaming platforms. General Entertainment, led by Peter Rice, oversees 20th Television, ABC Signature, ABC News, Disney Channels, Freeform, FX and National Geographic and will create episodic and original long-form content. Sports, led by James Pitaro, will be responsible for ESPN live sports programming, sports news and original and non-scripted sports-related content for cable channels, ESPN+ and ABC.

Meanwhile, a new single, global Media and Entertainment Distribution organization will be responsible for overseeing legacy platforms as well as monetization of content—both distribution and ad sales. Kareem Daniel, former president of Consumer Products, Games and Publishing, will head the Media and Entertainment Distribution group. The Media and Entertainment Distribution group will also manage the operations of Disney’s streaming services and domestic TV networks.

“Given the incredible success of Disney+ and our plans to accelerate our direct-to-consumer business, we are strategically positioning our company to more effectively support our growth strategy and increase shareholder value,” said Bob Chapek, CEO of The Walt Disney Company. “Managing content creation distinct from distribution will allow us to be more effective and nimble in making the content consumers want most, delivered in the way they prefer to consume it. Our creative teams will concentrate on what they do best—making world-class, franchise-based content—while our newly centralized global distribution team will focus on delivering and monetizing that content in the most optimal way across all platforms, including Disney+, Hulu, ESPN+ and the coming Star international streaming service.”

The new structure is effective immediately at Disney, with financial reporting expected to transition to the new structure in the first quarter of fiscal year 2021.

On Dec. 10, Disney will conduct a virtual Investor Day where it will present further details of its new DTC strategies.