Disney Headlines for August 17th, 2022
The most recent batch of Disney Headlines has proven decidedly positive. That’s what happens when a company announces record revenue.
Disney also provided new guidance on cruises, dismissed an activist investor’s suggestion, and planned some video game announcements.
Let’s talk about all the Disney Headlines you may have missed.
Back to Normal
Okay, I feel like I’ve been saying this for 18 months, but we’ve really gotten past the pandemic.
Disney has gradually rolled back and eventually eliminated all the various reminders of this painful period.
First, theme parks got rid of temperature checks. Later, they removed social distancing markers, hand sanitizer stations, and finally, face-covering requirements.
However, Disney couldn’t act so decisively with its cruise ships. As you know, a competitor’s cruise infamously heightened awareness of COVID-19.
Once that misfortunate ship returned to port, the entire cruise industry added stringent requirements to protect the safety of customers.
The Centers for Disease Control and Prevention also got involved, leading to numerous guidelines for sailings in 2020-2022.
Disney couldn’t have done anything about any of these policies, as they were recommended government guidelines.
So, Disney Cruise Line maintained its safety measures long after the parks had returned to pre-pandemic standards.
As of today, I’m happy to report that the CDC has stopped monitoring COVID-19 cases on cruise ships.
In other words, the CDC considers the entire cruise industry fully recovered from the pandemic.
For its part, Disney just updated its rules as well. Until recently, Disney required children ages 5-11 to take the COVID-19 shot to sail.
Starting on September 2nd, Disney will no longer enforce that rule. Instead, that decision will remain with the parents.
Unvaccinated children must still pass a COVID-19 test before boarding the ship, though. That rule hasn’t changed.
I should stress that nothing has changed for anyone 12 and up. Disney will still require vaccination and a negative test before sailing.
You can read a detailed MickeyBlog analysis from Melissa Roden here.
Also, I’d recommend this article from our friends at Insider. They discuss what happens when someone tests positive for COVID-19 before sailing.
Does Disney’s Board Need Changes?
Virtually everyone admired Disney’s strong fiscal third-quarter performance last week. I have to say “virtually” because of activist investor Daniel Loeb.
Loeb runs a billion-dollar hedge fund named Third Point Management. This company recently sold some other interests to spend the money on Disney stock.
Soon afterward, Loeb wrote the equivalent of a “to whom it may concern…” letter to Disney. This message called for changes, some small and some big.
For example, Loeb firmly believes that Disney should spin off ESPN into its own standalone entity.
Loeb and Third Point also feel strongly that Disney should take complete control of Hulu and make it an integral part of the company’s future.
Both these topics are ones we’ve discussed here before. Disney recently (arguably) passed Netflix to become the top streaming company in the world.
ESPN+ and Hulu+ subscribers factor heavily into that claim, as does the existence of the Disney Bundle. It combines those streaming channels with Disney+ in a single package.
Loeb believes that ESPN should be its own thing to alleviate Disney of a growing sore spot.
Disney doesn’t want to sully its brand through gambling ties. However, ESPN could monetize itself Scrooge McDuck style by signing more gambling deals.
Such agreements aren’t just lucrative. They hint at a future where many online interactions include a gambling element.
As a standalone brand, ESPN would work as the connecting hub for many such engagements.
Also, ESPN’s massive licensing agreements for sports rights wouldn’t impact Disney’s bottom line.
However, Disney doesn’t want to do this because ESPN remains a breadwinner. Moreover, by spinning off the brand, Disney would lose potential revenue.
Of course, that wasn’t Loeb’s only suggestion. He also argued that Disney should overhaul its Board of Directors. That’s a debate for another day, though.
The Video Game Announcements Coming Soon…
Daniel Loeb’s comments likely rattled Disney’s C-suite. After all, he’s the one who had previously suggested that Disney drop the stock dividend during the pandemic.
Disney still hasn’t restored the stock dividend based on Loeb’s advice, even though he later sold his interest in the company.
Now, he has taken a new stake worth roughly $1 billion, and that puts pressure on Disney.
After all, if Loeb gets his wish and adds new board members, Chapek’s position as CEO comes into question once more. He needs those votes.
For this reason, Disney must take its upcoming announcements quite seriously. Any dip in the company’s stock could enable Loeb to increase his call for change.
How will Disney avoid such potential PR woes? The answers come in September. That’s when the 2022 D23 Expo begins.
We expect announcements regarding new theme park amenities, but that’s not Disney’s only revenue stream.
In fact, Disney just confirmed the Disney and Marvel Games Showcase on September 9th. That’s a first for the company.
More importantly, this reveal signifies that Disney is ready to take gaming seriously once again.
The company famously eliminated its in-house development teams a few years ago.
Now, Disney is ready to provide updates on Disney Dreamlight Valley, LEGO Star Wars: The Skywalker Saga, Marvel’s Midnight Suns, and much more!
I cannot tell you what else because, well, Disney hasn’t announced it yet! However, we’re noticing a new trend in the gaming industry.
Televisions are now capable of playing video games without a console.
Here’s an example of Xbox Game Pass running straight through a Samsung app:
Between this and mobile devices, gaming is everywhere. That trend will only grow as we enter the internet’s metaverse/Web 3.0 phase.
Disney licenses are extremely valuable and should be monetized in gaming!