Tuesday, January 16, 2018
Business

Disney to launch streaming services for movies, live sports

NEW YORK — With new streaming services in the works, Disney is trying to set itself up for a future that's largely been framed by Netflix: Providing the stuff you want to watch, when you want to watch it.

The Magic Kingdom is launching its own streaming service for its central Disney and Pixar brands and another for live sports. That would allow it to bypass the cable companies it relies on — and Netflix — to charge consumers directly for access to its popular movies and sporting events.

"They're bringing the future forward. What they talked about were things that looked inevitable, at some point," said Pivotal Research Group analyst Brian Weiser. What's less clear is if Disney will be able to make big bucks from it, he said.

This is important as the decline in cable households and the shift to smaller, cheaper bundles pressures the profitability of Disney's cable networks. Fewer subscribers and fewer viewers mean less money. In the nine months through July 1, cable networks' operating income fell 13 percent from the year before, to $4.12 billion.

KID STUFF

Starting in 2019, the only subscription streaming service with new animated and live-action Disney and Pixar movies will be the Magic Kingdom's own app. That will include Toy Story 4 and the sequel to the huge hit Frozen. Older movies will be there too, as well as shows from the TV channels Disney Channel, Disney Junior and Disney XD, and original TV and films. That could be hugely attractive for families with young children in the U.S.

Disney is ending an exclusive earlier movie deal with Netflix, and the streaming giant's shares tumbled in after-hours trading. Netflix today has grown into an entertainment juggernaut in its own right, however, as it focuses more on its own exclusive programming.

Netflix already seemed to be bracing for the potential loss of the Disney movie rights earlier this week when it announced its first-ever acquisition — the purchase of Millarworld , a comic book publishing company that will develop films and kids shows based on its portfolio of character.

Disney might bring more of its properties — particularly its Marvel superheroes and the Star Wars franchise — under its wing, and could even offer them as separate streaming services. CEO Robert Iger said Disney is considering whether it should continue licensing Marvel and Star Wars movies to outside services like Netflix, move them into the Disney app or develop individual services for them.

The Disney service will be available in "multiple markets" outside the U.S. as well, taking advantage of Disney's global name recognition.

SPORTS

Disney had already said it would be launching a streaming ESPN service. It's not meant to compete with the company's TV channels.

The sports service is coming in early 2018, a little later than previously announced, and will air baseball, hockey and soccer games, tennis matches and college sports through ESPN's popular mobile app. Notably, ESPN will not be streaming pro football or basketball, at least initially.

Customers will also be able to buy fuller streaming packages from the baseball, hockey and soccer leagues, and watch them on the ESPN app.

"Ultimately, we envision this will become a dynamic sports marketplace that will grow and be increasingly customizable, allowing sports fans to pick and choose content that reflects their personal interests," Iger said on a conference call with analysts.

Disney will have to be careful that it doesn't transfer too much sports programming from its TV channels to the app. Getting the balance wrong could upset cable companies and weigh on the price they pay Disney for ESPN, Weiser said.

THE BACK END

To roll out its streaming services, The Walt Disney Co. will take majority control of BAMTech, a streaming arm of Major League Baseball spun off last year from Baseball Advanced Media, for $1.58 billion. When the deal closes, Disney will own 75 percent of BAM Tech, up from the 33 percent stake it acquired for $1 billion as part of an agreement announced last year.

The acquisition and the new services will be "an entirely new growth strategy" for Disney, Iger said.

The new streaming services will likely "accelerate the erosion" of Disney's TV networks, especially if other major cable networks make similar moves, said Moody's analyst Neil Begley.

But Iger argues that BAMTech gives Disney "optionality" if the cable ecosystem changes further, Iger said on a conference call with analysts Tuesday. If there's greater "erosion" — say, if more people drop cable bundles or choose cheaper bundles without key Disney channels — the company has more ways to get its entertainment directly to customers, Iger said.

He said there are no current plans to sell the Disney or ESPN TV channels directly to customers on the apps.

But having a direct relationship with customers tells Disney exactly what they're watching, giving it powerful tools and information that could help feed decision-making and, on the sports side, sell advertising.

Comments
Airbus could abandon A380 superjumbo amid lackluster sales

Airbus could abandon A380 superjumbo amid lackluster sales

New York TimesThe days may be numbered for the world’s largest passenger aircraft.Airbus, the European aerospace group that makes the A380 superjumbo, said Monday that it would have to end production of the plane if its only major customer, Emirates,...
Updated: 10 hours ago
The closing of 63 Sam’s Club stores has big implications for small business

The closing of 63 Sam’s Club stores has big implications for small business

Special To The Washington PostLast week, Walmart announced that it would be closing 63 of its under-performing Sam’s Club stores at various locations throughout the country, including a South Tampa location.PREVIOUS COVERAGE: South Tampa Sam’s Club i...
Published: 01/15/18
Brawny pickups, futuristic SUVs star at Detroit auto show

Brawny pickups, futuristic SUVs star at Detroit auto show

Associated PressDETROIT — It’s the year of the pickup truck at the 2018 North American International Auto Show in Detroit as General Motors, Fiat Chrysler and Ford unveil new trucks in a fast-growing and highly competitive U.S. auto market. Fiat Chry...
Published: 01/15/18
2017 still a deadly year for Tampa Bay pedestrians, bicyclists

2017 still a deadly year for Tampa Bay pedestrians, bicyclists

Another year gone, another year that Tampa Bay was one of the most dangerous places in the country for those walking or riding their bikes.More than 100 people were killed walking in Hillsborough, Pinellas and Pasco counties in 2017, according to sta...
Published: 01/15/18
If Florida’s offshore oil rush ever happens, only one side of the state is likely to see it

If Florida’s offshore oil rush ever happens, only one side of the state is likely to see it

The offshore drilling rigs that pepper the central Gulf of Mexico off Louisiana and Texas tap some of the nation’s richest oil and natural gas reserves.That proven and profitable productivity is why the energy industry has pushed for decades to open ...
Published: 01/14/18
Large crowds grab deals as Sam’s Club prepares to close South Tampa location

Large crowds grab deals as Sam’s Club prepares to close South Tampa location

TAMPA — Large crowds have gathered to snap up some deals before the Sam’s Club in South Tampa closes its doors for good on Jan. 27.On Thursday, the retailer announced it was closing dozens of stores, including a location at 5135 S Dale Mabry Highway...
Published: 01/13/18
For the first time, the 3 best-selling beers in America are light beers. Can craft brewers catch up?

For the first time, the 3 best-selling beers in America are light beers. Can craft brewers catch up?

Is it time for the King of Beers to hand over its crown?Preliminary analysis of national 2017 beer sales indicates that, for the first time in decades, Budweiser is no longer one of the top three beer brands sold in the United States. Bud Light, whic...
Published: 01/13/18
Valley National launches ‘Pop-Up Moments’ campaign for Tampa Bay nonprofits

Valley National launches ‘Pop-Up Moments’ campaign for Tampa Bay nonprofits

Leaders from Valley National Bank/USAmeriBank surprised the students of two local schools, Ybor City’s Academy Prep, 1407 E Columbus Drive, and St. Peter Claver Catholic School, 1401 N Governor St., with donations of much-needed supplies. This happen...
Published: 01/12/18
Updated: 01/14/18
Lottery winner minefields: Financial planning, emotions, relationships

Lottery winner minefields: Financial planning, emotions, relationships

The biggest challenge for lottery winners isn’t the massive sum of money suddenly dropped into their lap — it’s everything else that comes with it. "They’re going to be pulled in a lot of different directions," Steve Athanass...
Published: 01/12/18
Updated: 01/13/18
Tampa Electric planning to convert Big Bend power plant where five died in June from coal to natural gas

Tampa Electric planning to convert Big Bend power plant where five died in June from coal to natural gas

TAMPA — The parent company of Tampa Electric plans to seek regulatory approval in coming months to convert its Big Bend power plant, the site of an industrial accident that killed five workers last year, from coal to natural gas, a top executive said...
Published: 01/12/18
Updated: 01/13/18