In another round of cost-cutting measures by Disney, at least 50 titles will be cut from both Disney + and Hulu platforms by May 26th. CEO Bob Iger also announced an increase in the price of the ad-free tier of the Disney+ app “to better reflect the value of our content offerings.”
This news comes after prior months of staffing cuts across the company, totaling 3% of staff company-wide, or roughly 7,000 employees. ESPN also took a hit of a little less than 100 jobs in the second round of staff cuts, with a third round on the way. In a memo, CEO Jimmy Pitaro said, “As we advance as a core segment of Disney, with operational control and financial responsibility, we must further identify ways to be efficient and nimble. We will act with compassion, respect for our colleagues, and professionalism as we face these hard circumstances.”
CFO Christine McCarthy said in an earnings call that the company expects a write down between $1.5-1.8 billion dollars by removing content, saving them on taxes.
Iger says that the company restructuring is about reevaluating the volume of content and exactly how they spend money. Profitability is the focal point for the company going forward. Also, in an effort to consolidate and restructure, the company will be offering a “one-app experience,” combining Hulu and Disney+ for users of both apps.
Another factor that may be affecting the bottom line when it comes to content creation and longevity is the writer’s strike, organized by WGA, a writers union. Many shows on cable and streaming platforms have been suffering from the strike, as a lack of writers has led to even shorter seasons, stalls in shows in production, and further pressures on the financial bottom line as writers want guarantees to avoid the current “feast or famine” environment within the industry.
