New information about outgoing Disney CEO Bob Chapek suggests he masked Disney+’s losses by changing the budgets of his original shows.
A recent report claims that former Disney CEO Bob Chapek tried to make Disney+ more profitable by changing the budgets of various projects.
According to The Wall Street Journal, “people familiar with the matter” shared that shows should be (and billed as) Disney+ originals, including The Secret Society of Benedict as well as Dougie Kamealoha, MD, first aired on other networks such as Disney Channel, so their production and marketing budgets did not count towards Disney+. Thus, the streaming service was seen as having lost less money on original content. CFO Christine McCarthy, who was reportedly one of the supporters of ousting Čapek, was “concerned about the strategy.”
Capek has been very dependent on Disney+, as he promised investors that Disney’s streaming arm, which also includes Hulu and ESPN+, would be profitable by 2024. However, Disney+ has 164 million subscribers, about two-thirds of Netflix’s current number, and $30. The billions invested in content in 2022 alone were not enough to stem the rise in losses over the past four quarters. Overall, the streaming division has lost more than $8.5 billion since Disney+ launched in 2019.
In a surprise announcement on November 20, 2022, Disney confirmed that Chapek would retire after less than three years on the job and be replaced by his predecessor, Bob Iger. The returning executive, who has held the top position at Disney for 15 years, has overseen such milestones for the company in the 21st century as the acquisition of Pixar, Marvel, Lucasfilm and 21st Century Fox. Since the announcement, there have been speculations as to why the Disney board found Chapek’s leadership to be unsatisfactory. These include Disney+’s unpopular price hike and disparaging remarks he made about animation that reportedly angered and alienated Disney and Pixar animation staff.
In March 2022, there were also rumors that Capek would be ousted due to mishandling of Florida’s “Don’t Say Gay” bill, with Disney employees going on strike amid Chapek’s refusal to denounce the bill and revelations that Disney was financially supporting some of Florida’s policies. behind the anti-LGBT law. Investor concern was raised by Scarlett Johansson’s lawsuit against the company over the film’s direct streaming release. Black Widow, which violated the contract she made with the entertainment monolith. According to insiders, many board members believe that Capek’s actions in this situation left much to be desired.
Source: The Wall Street Journal.