For more than a year, Disneyland's Mainstreet USA has been a ghost town. Disney's (NYSE: DIS) biggest blockbusters have lingered on the back burner. And ports hold onto the empty shells of vacant Disney cruise liners.
In the fourth quarter alone, park closures ate away at $2.6 billion in potential profits. During these dark months, only one thing stood in the plus column for Disney, and that is Disney+.
At the company's latest shareholder meeting, Disney CEO Bob Chapek proudly announced that the ranks of Disney+ subscribers have swollen to 100 million in just 16 months. A success "which has now inspired us to be even more ambitious, and to significantly increase our investment in the development of high-quality content," Chapek elaborated in a statement, reported by CNBC.
Disney+ is the exclusive home of most Marvel and Star Wars content and the sort of happily-ever-after narratives that many craved during the pandemic's dark days. The landmark success of Disney+ original series-"The Mandalorian" and "WandaVision" also helped send the subscriber count higher.
It's Disney+ that helped keep Disney's share price from going the way of other travel and entertainment stocks, like Carnival Cruise Lines (NYSE: CCL) and AMC (NYSE: AMC). But now shareholders have even more to look forward to from Disney as a whole.
Movie theater doors and park gates are poised to swing open. During the pandemic, Disneyland's future, and the future of its tens of thousands of employees, was at the mercy of California regulators. Now those same regulators will let the park reopen, hopefully as soon as next month, at between 15-35% capacity. As of this writing, 45% of North American movie theaters are open, and that number is going up nearly every week.
But as the world returns to normal, the question is, will Disney? Will the company continue to bank on ticket sales at box offices and park gates around the globe? Will Disney return to the ways of 90 day theater exclusives, followed by a limited DVD run?
It's unlikely.
Disney plans to go into streaming and hard. In October, the company embarked on an overhaul of its media and entertainment divisions- to capitalize on streaming, according to CNBC. Around that time, the company also announced plans for 100 new movies and tv shows, 80% of which are set to release directly onto Disney+.
However, Disney's push into streaming doesn't mean the company is ready to abandon the sinking ship that is brick-and-mortar movie theaters. The overhaul of Disney's distribution system gives the company flexibility. Disney's new Media and Entertainment Distribution group will decide how to release content in the future.
We could see a film premier in both movie theaters and living rooms simultaneously. We could see a show pull in ad-revenue through a run on ABC, only to find its way onto Hulu, another Disney streaming service, a few weeks later.
Disney's overhaul gives it options to meet consumer's rapidly changing preferences. After the dust from the pandemic settles, people might never set foot in a movie theater again. But others might turn out in droves.
Point is that under its new normal, Disney can reach everyone.