Revolutionary streaming shift; Disney to close 100 cable TV channels

India is unlikely to be affected by the move.

Mumbai: In a major announcement, Disney has declared that it will shut as many as 100 cable channels this year. The decision was confirmed by Disney CEO Bob Chapek at the recently concluded JPMorgan’s annual Global Technology, Media, and Telecommunications conference. 

Disney has decided to take this revolutionary move to push their direct-to-consumer strategy, mainly using its OTT platform Disney+. The closure of 100 cable channels come in addition to the 30 foreign networks the company shut down last year.

Migrating content to Disney Plus

"The great majority of that content will migrate to Disney+. That continues to be a core strategy for us as we pivot towards direct-to-consumer," said Chapek during the talk, adding that he remains confident about the d2c business. "We now have an organization that's pretty much built to scale up this d2c business. We can guarantee that we have enough content flow no matter which distribution model we choose to employ. We have also been working on our global expansion and got a very flexible distribution model that can toggle on consumer behaviour and Covid recovery."

The Disney CEO also added that the closure of channels will depend on contracts, the company has in individual markets. Chapek made it clear that consumers are increasingly choosing to watch content online, and Disney always wants to stay ahead of trends.

Talking about maintaining the balance between the linear and d2c business, Chapak said, "To some extent our linear business is generating tonnes of cash-flow, especially if we see it as a business that's emerging from a very tough year. It gave us a better cash position. So, it's nice to have a strong cash flow business like the linear business, a lot of it is actually funding our direct-to-consumer investment. It would have been difficult without that."

Opportunities in the Indian market 

Disney has already decided to shut down numerous channels in South East Asia and Hong Kong that include, Star Sports 1, Star Sports 2, Fox Sports, Fox Sports, and Fox Sports 3. However, it is unlikely to impact Star Sports, one of the most popular sports channels in India that holds rights to some of the biggest sporting properties in the country including IPL, BCCI Rights, and ICC Rights. 

During the talk, Chapek gave a glimpse of Disney's approach in the Indian market, which he believes is very diverse. Chapek described India as a mobile-first market, where diversified audiences watch content in different languages.

According to Chapek, due to low bandwidth, it is highly necessary to deliver tailored content for Indian audiences. The Disney CEO also talked about the obsession of Indians towards cricket and added that Disney+Hotstar has plans to broadcast cricket matches in various local languages.

"India is a unique market. We have a mass market for pricing and distribution. It is a highly unique market in terms of distribution because it is really a mobile-first market, which is kind of unusual. They have low bandwidth. It means we have to tailor our offerings to match their low bandwidth. And local languages are particularly important there, which means we have to customize the content," said Chapek. 

Chapek claimed that Disney+Hotstar has unparalleled content in multifarious genres available for Indian audiences, and it includes over 17,000 hours of local content. 

It was in last year that Disney introduced Disney+Hotstar in the Indian market. The service which features cricket matches, local content, and movies now account for 30 per cent of Disney+’s total subscriber count of 103.6 million globally.

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