MickeyBlog Disney News – Memorial Day Edition
The good and the bad are on full display in the latest edition of MickeyBlog News. And even what qualifies as “bad” for Disney is still pretty amazing. Read on to find out what I mean in this box office-and media-focused edition…
We Miss Harrison Ford
Solo: A Star Wars Story debuted in theaters this weekend. After reports of record-setting pre-sales, The Walt Disney Company had internally projected a holiday weekend total of $170+ million. Yes, that was a tracking estimate for four days, but Deadline reported that story on May 3rd. Three weeks later, we now know that these projections were incredibly optimistic.
Disney announced their four-day weekend estimate for Solo today, and it’s remarkably low at $101 million. Yes, that’s about $70 million short of expectations from earlier this month. The company also received a second bit of disappointing news, as Solo managed only $65 million internationally for a total global take of $166 million this weekend.
I know you’re wondering in what universe that’s bad. Well, The Walt Disney Company is a publicly traded stock. Any signs of weakness tend to impact the company’s bottom line. And the perception at the moment is that Solo is a significant box office disappointment.
The explanation is that Star Wars: The Last Jedi opened to $220 million in three days, with another $230 million gained internationally. You don’t have to be a math genius to see that $450 million is quite a lot more than $166 million. Even if we use Rogue One: A Star Wars Story as a comparison, it earned $155.1 million domestically in three days, with $135 million overseas. That global take of $290.1 million is far ahead of Solo.
The strange part of the conversation is that most people who have seen Solo enjoyed it. The film has an A- Cinemascore, a good grade, albeit lower than the A received by all three other Disney-released Star Wars films thus far. Solo is also 71 percent fresh at Rotten Tomatoes and has earned a 7.1 rating at IMDb. All of these are solid numbers for the average film. They’re also lower than recent Star Wars offerings.
What’s the issue here? I suspect it’s a combination of two factors. The first is product saturation. George Lucas released his fourth Star Wars film in 1999, 22 years after the original Star Wars. Disney has produced four Star Wars movies over the past three and a half years. That’s a lot.
Also, the reality is that while Alden Ehrenreich is charming in the title role, he’s not Harrison Ford. To a lot of people, replacing an actor who is still alive in one of the most iconic performances ever is a non-starter. Resistance to a new, young Han Solo is almost assuredly a key factor in the film’s box office disappointment.
Having said that, let’s be clear. Few films earn $100 million in North America in four days. Another Disney release from earlier this year, A Wrinkle in Time, has grossed $97.7 million during its entire theatrical run. Also, Disney is largely competing against itself right now. They claim two of the top three movies at the box office, and the other one is incomprehensibly massive.
In fact, let’s take a moment to catch up on Avengers: Infinity War, the “good” for Disney this week. With another third place finish this week, its domestic total is up to $621.7 million. Only eight films ever have earned $620+ million. Out of those titles, five are official Disney releases, and another is Avatar, which Disney will own soon.
Even more remarkably, the latest Marvel Cinematic Universe release should end up with $675 million, making it only one of four blockbusters to manage that feat. Disney will have released two of them during the first half of 2018, with Black Panther the other title.
In other words, what hurt Solo a lot was that Disney had two other monumentally successful films to advertise over the past few months. They got spread thin in the marketing and took the Star Wars title for granted a little bit. Since Infinity War will hit $2 billion in worldwide box office and Black Panther is near $1.3 billion, Disney was playing with house money on Solo anyway.
The entire situation with Solo’s box office disappointment is a shame, however, because I’ll post a review later in the week that is unabashedly positive about Ehrenreich. He’s legitimately good as Han Solo! If you’re on the fence about the movie, go watch it! You’ll find yourself charmed by the entire cast.
When you think about elbow smashes, takedowns, and submission holds, you don’t think about Disney. Well, if you do, you need to have a long talk with your family about acceptable vacation behavior. The Mouse House has to think about everything, though.
ESPN, the self-proclaimed Worldwide Leader in Sports, has struggled in recent years, largely through no fault of their own. They’re in a dying industry, broadcast cable television. In order to survive and advance into a new kind of media, streaming services, the company has made some bold moves in recent years. The latest one might take the cake, though.
Disney has signed a five-year-contract to broadcast UFC events. And UFC stands for Ultimate Fighting Championship if you don’t know. Yes, ESPN will become the home to 30 live UFC broadcasts each year, all of which will be available to users of the fledgling ESPN+ app.
Disney executives have correctly determined that live events are the most crucial element in broadcasting today. With those many eyeballs, ESPN can sell more advertising AND entice more people to subscribe to their $4.99 streaming service. It’s a win/win deal long-term, but Disney has to pay $300 million annually for the UFC broadcast rights. We’re talking about a lot of money at a time when analysts already worry about ESPN’s financials. So, it’s a bit of a gamble, but I think it’s a smart play, particularly in light of competition from places like…
Netflix Briefly Dethroned Disney
For many years running, Disney’s had a special claim to fame. They’re the most valuable media company in the world. What does that mean? Out of companies that make their money from media enterprises, Disney has the largest market cap. Alas, objects in the rear view mirror are closer than they appear.
For a brief period last week, Netflix supplanted Disney in terms of market share. The surge stemmed from a glowing Netflix subscription numbers report. It indicated that 125 million people own and pay for Netflix accounts. In the wake of this report, Netflix had a market cap of $152.6 billion, while Disney fell to $151.8 billion. When the stock market closed last Friday, the two were virtually tied at $152 billion each, with Netflix slightly ahead.
There’s one important aspect to this story that is otherwise simply about bragging rights. Some people consider Comcast exclusively a media company. I’m not one of them, but to those who do, it’s been right there with the other two corporations in terms of market cap. At time of publication, Comcast sits at $142.6 billion. This IS important to Disney fans, because it explains something.
Comcast has tried everything possible to drum up support for their bid to take over Fox. Even though the business world sees the deal as a fait accompli, they’re still pushing the idea. They’re doing this for a simple reason.
We live in a media world now. Content isn’t just king. It’s the end-all, be-all. Disney and Netflix are currently waging a next-level war for content dominance. Disney’s impending acquisition of Fox is such a masterstroke that Comcast is worried about their future. Without Fox content, they don’t think they have enough strong intellectual properties to compete with Disney…and they’re right. So, Netflix might go ahead for a while, but there’s a reason why the decision makers at Fox preferred Disney stock to cold, hard cash. They know Disney is better.
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