Disney is, by far, the most senior of the three. With nearly 90 years in the entertainment industry, “The Mouse” is a behemoth that operates everything from amusement parks and cruise lines to entire TV channels. It also owns Marvel’s entire catalogue, the Star Wars Universe, streaming service major Hulu, and recently-launched Disney+ – which makes available the entirety of its home-grown catalogue of virtually tens of thousands of movies and TV shows. Starting in Q1 FY 2021, Disney reorganized its reportable business segments. The company now operates through two main business segments: Disney Media and Entertainment Distribution (DMED) and Disney Parks, Experiences and Products (DPEP).
While DPEP is comprised of theme parks and resorts in Florida, California, Hawaii, Paris, Hong Kong, and Shanghai and also includes a cruise line and vacation club, DMED is further broken down to:
- “DMED: Linear Networks”, which operates cable networks such as Disney, ESPN, and National Geographic; the ABC broadcast television network and eight domestic television stations; as well as the company’s 50% equity investment in A+E Television Networks.
- “DMED: Direct-to-Consumer”, which is comprised of its various streaming services, including: Disney+; Disney+Hotstar; ESPN+; Hulu; and Star+.
- “DMED: Content Sales/Licensing and Other”, which sells film and television content to third-party TV and subscription video-on-demand services.
DMED’s third segment is a rising concern for the likes of Netflix and Roku. Increasingly, more and more content developers (such as Disney, CBS and NBC) have been “going their own way”, i.e. building out their own streaming services. This explains Netflix’s increasing push to develop its own content. Roku, too, announced the launch of its own original programming in May, which will initially become available to viewers in the U.S., U.K. and Canada through its free streaming hub, The Roku Channel. The initial set of 30 titles was acquired from the now-defunct Quibi streaming service, with more original content slated to debut over the next year.
Metrics of Meaning
There is a substantial disparity in comparing the entirety of Disney versus the other two: the former’s non-streaming properties are much larger than its streaming segment. Plus, the former took a massive hit during the pandemic-induced restrictions.
Doing a side-by-side comparison of operating income gives very skewed results.
