Why Disney’s on-demand release of “Mulan” is still a failure
Disney‘s (NYSE: DIS) The Disney + streaming platform is an unprecedented success, reaching over 60 million subscribers in less than a year and four years ahead of schedule.
It was also a perfectly timely start as the global pandemic shut down movie studios, prompting consumers to turn to the streaming platform for entertainment. Disney isn’t giving up on theaters – it can’t give up the billions of dollars they generate – but it’s a “unique opportunity“to extend the Disney + brand beyond a simple subscription service.
Yet despite what appears to be an increase in downloads of the video streaming platform’s app over the weekend, Disney’s direct video release of the live-action remake of Mulan could still be a failure.
Good, but not good enough
Sensor Tower data shows there was a 68% increase in Disney + downloads last weekend to 890,000, from the previous weekend, as well as a 193% increase in spending for the $ 12 million app, showing Mulan was the driver.
While Apptopia’s figures show around 25% fewer downloads, or 674,000, that still suggests there was significant demand for the film.
Still, that might not be enough to recoup Disney’s investment. Even at the highest numbers, that’s less than $ 27 million generated, which might not even pay for the film’s marketing costs. Of course, the download numbers don’t account for other ways people signed up for the service, but Disney would still need millions of Disney + subscribers who would also have to pay just to break even, which seems unlikely.
Subscribers only have to wait until December 4, when Mulan appears on the streaming platform and they can watch it as part of their subscription.
A high obstacle
Of course make profit Mulan was not Disney’s only goal. Attracting more Disney + subscribers and keeping them with the service was a secondary consideration, as was proof that consumers would pay for the content of the service.
Some of these goals seem successful, but there are differences between when Comcast‘s (NASDAQ: CMCSA) Universal Pictures released Troll world tour at streaming video in april and Mulan goes on demand this weekend which is why it might not be so successful.
When Universal came out Troll world tour, the pandemic was just beginning, the children were suddenly at home doing nothing, and the parents were desperate for a diversion. At $ 20 a pop, it was an easy call to make.
It’s no longer the case now. The economy is reopening; there is much more entertainment available, including movie theaters; and the $ 30 broadcasting fee is a deterrent.
Consumers pay go to the movies, although they may wait a few months for a movie to appear Netflix Where Amazon, because they want to live the experience on the big screen. In MulanIn the case of, consumers are urged to pay near-movie-theater rates for a small-screen experience, and Disney + subscribers are given the option of just waiting.
Mulan doesn’t get the best reviews either. RottenTomatoes has a 78% review score and a questionable 55% audience rating as Disney chose to cut out some original scenes and characters that made the animated version a classic to appease Chinese audiences (RIP, Mushu the dragon ). The film also has a darker, more grown-up flavor than the original which kids might not find as appealing, and it’s caught up in the politics of Hong Kong independence.
Maybe next time
The increase in Disney + downloads and spending for the app is encouraging, and Disney appears to have opened a new channel for future movie releases, but Mulan itself still looks like a failure.
Less greedy prices, better director decisions, and smarter film selection might be what Disney needs to grow its video streaming platform while making a profit on the movies.
This article represents the opinion of the author, who may disagree with the “official” recommendation position of a premium Motley Fool consulting service. We are motley! Challenging an investment thesis – even one of our own – helps us all to think critically about investing and make decisions that help us become smarter, happier, and richer.