Disney's live-action exodus

Why put in theaters what can succeed more on Disney+?

Do you remember that Dumbo came out last year? Disney would prefer if you didn’t. 

Disney has a live-action adaptation problem, but it might not be as clear on the surface. Aladdin and The Lion King both brought in more than $1 billion, The Jungle Book was praised for its use of CGI technology at the time and, for some reason, people have an affinity for Tim Burton’s 2010 version of Alice in Wonderland. These are all successes, but the well is quickly beginning to dry up.

Both Aladdin and The Lion King received less than stellar reviews, Maelficient: Mistress of Evil didn’t crack $500 million, and Dumbo was such an utter failure that I bet you’re still trying to remember if you saw it when it came out almost two years ago. How to Train Your Dragon director Dean DeBlois called the recent run of live-action remakes “lazy on part of the studio,” and critics have admonished Disney for just using the same formula over and over again without creating anything substantially new. 

Arguably, it was Bill Condon’s 2017 adaptation of Disney’s Oscar-nominated 1992 film, Beauty and the Beast that got the whole train rolling. The film brought in $1.2 billion worldwide, and the cast received praise from critics for their performances. Disney die-hards loved it, kids loved it, and mainstream audiences who don’t fall into either of those categories seemed to dig it, too. But Aladdin, The Lion King, Jungle Book, Beauty and the Beast...there are only so many of these “A-type” titles to go around. Hell, even Disney Studios co-chairman Alan Horn admitted as much, telling The Hollywood Reporter that “at some point, we are going to run out of the kinds of films like Aladdin and Lion King.” 

It’s already happened. Here are some stats from one of my favorite analysts and VCs, Matthew Ball: Dumbo lost $160 million, Mary Poppins Returns basically broke even, while Maleficent: Mistress of Evil and Through the Looking Glass both saw more than 40% drops in profit compared to the first films. Christopher Robin lost more than $40 million, and Nutcracker saw a loss of just under $70 million. Now, in a period of unprecedented acceleration, Disney Studios executives have a new path in front of them, one that will please both investors and audiences alike: Disney+ originals. 

Disney knew the live-action magic they had with a few titles wasn’t going to work across the board, and before the COVID-19 impact hit, Disney was looking for a way to experiment with those titles. Lady and the Tramp was a Disney+ exclusive title, and Christopher Robin left theaters early so Disney could try to gain some additional revenue via digital retailers like iTunes and Amazon. 

On Thursday, Deadline reported that Disney was contemplating moving three live-action adaptations to Disney+. Cruella, Pinocchio, and Peter Pan and Wendy would instead premiere exclusively on the streaming platform, something that has become an unsurprising move for the House of Mouse. Over the last 10 months, Hamilton, Artemis Fowl, and Mulan all moved to Disney+, with Pixar’s upcoming Soul set to debut exclusively on Disney+ on Christmas Day. 

It’s an easy decision to make right now. Theaters in key marketplaces like Los Angeles and New York City remain closed. Cases are skyrocketing around the world, and theaters could start shutting down again to comply with government regulations. Trying to plan out a good time to release a movie — one that doesn’t generate as much excitement and interest as The Lion King or Aladdin — is nearly impossible. 

Why bother? By going straight to Disney+, the company keeps a consistent line of new, noteworthy feature films coming to ensure subscribers stick around while also driving new subscribers to sign up. Disney doesn’t have to worry about articles proclaiming Cruella a DOA movie because of low audience turnout, and instead can continue to boast about subscriber growth as Disney+ expands internationally. 

Horn added in his Hollywood Reporter interview that Disney has“taken a step past that now, so Maleficent is a step away from Sleeping Beauty, and Cruella is a step away from 101 Dalmatians.” The lingering issue, Horn acknowledged, is there’s no question “it's a finite universe." Finite in stories? Maybe. I would argue that’s not the case. This is the same studio that has found a way for Mickey Mouse and pals to have different adventures for nearly 100 years. Finite in movies that will drive people to theaters to spend $60 on tickets for the family? Absolutely.  

“Now, I can say to [Disney Studios head] Sean Bailey, you can make those films again because we don’t need to spend $30 million in marketing,” Horn said. “I don’t see it as an ‘A or B movie’ thing. It’s financial.” 

Here’s the baseline approach, as I see it, to the theatrical vs streaming (taking out digital marketplaces right now) debate: 

1. Streaming is never going to replicate the $800M - $1B+ revenue that blockbuster titles bring in to studios. That’s why big Marvel movies will always appear in theaters, even if they’re offered simultaneously through Premier Access (like Mulan).

2. At the same time, per capita theatrical attendance is at the lowest it’s been in nearly 100 years. In 2019, people on average visited a movie theater less than three and a half times, according to Bloomberg. That’s the lowest it’s been since 2002. If you’re trying to figure out which films they likely saw, the answer is probably something owned by Disney (Avengers: Endgame, Star Wars: The Rise of Skywalker) or Warner Bros. (Joker). 

3. Since less people are going to theaters, and the top 25 films, which make up roughly 50% of box office grosses, are all major franchise blockbusters, there’s a huge gap for independent or non-franchise films. 

4. Over the last several decades, more films have been ordered by studios — they just can’t compete in a marketplace where people are attending movies less, and those they are attending are blockbuster titles that tend to dominate cultural conversation. (A seasonal argument opposing this is Oscar time, when people go out to watch films that don’t necessarily cost $100 million but are Best Picture contenders.)

5. Many of those studios are also investing in growing their own direct-to-consumer offerings: Disney has Disney+, Warner Bros. has HBO Max, Universal has Peacock, and Paramount has Paramount+ (formerly CBS All Access). These are integral to each studios future, and need content to compete.

6. So: if studios are making more movies, but they aren’t seeing the ROI they need at the box office, moving films that people are unlikely to go to a theater for to streaming platforms that help to generate recurring revenue through direct-to-consumer pathways is the best option. 

AT&T CEO John Stankey said the key to attaining subscribers is an originals game, and retention is a library game. That’s true — but the simplified version of Stankey’s thesis leaves out that avoiding churn is a game of impactful additions every quarter. Netflix has a great library and a line of fantastic originals, but people keep opening Netflix because there’s always something new to watch. Every three months, HBO has one, two, or three new series that people are talking about — with documentary films and other features thrown in throughout. 

Disney+ will soon have that with its Marvel, Pixar, and Star Wars original series, but using live-action adaptations that are tied into bigger Disney IP is a smart way of keeping people around. Cruella isn’t 101 Dalmatians, but an Emma Stone movie set within the 101 Dalmatians world is enticing. Same with Pinocchio and Peter Pan and Wendy. Disney CEO Bob Chapek has spent the last several months trying to publicly recognize how important Disney+ — and Disney’s suite of streaming services — is to the company’s cultural and financial future. The worst period of Disney’s existence as a company finds its silver lining. 

Not all live-action adaptations are going to become straight to Disney+ titles. The Little Mermaid, Bambi, Hercules, and Lilo and Stitch are likely going to do well for Disney in a post-COVID world. Not by 2019 standards, but whatever the new normal becomes, those films will likely perform well. All the other films? The ones that aren’t a new Marvel Studios production, the start of whatever Star Wars’ next trilogy is, a popular addition to a Pixar franchise, a live-action adaptation of a beloved classic — those will head to Disney+. 

And if they convince you to keep spending $7 a month, or sign up in the first place, the direct-to-Disney+ adaptations have done their job, too. 

Studios

• Indiana Jones 5 set to begin production in August 2021

  • Harrison Ford will pick up the bullwhip and strap on his hat again in August 2021 when Indiana Jones 5 heads into production. Development on the film has stalled for some time, but the cast and crew will head to Pinewood Studios in the United Kingdom to film. Production on a number of films and TV shows has picked up since everything shut down 10 months ago. Logan director James Mangold is set to direct the fifth installment, taking over for Steven Spielberg. (The DisInsider) 

• Deadpool 3 lands Bob’s Burgers writers to pen the script

  • You love to see it kept in the family! Bob’s Burgers writers and sisters extraordinaire, Wendy Molyneux and Lizzle Molyneux-Loeglin will write Deadpool 3, with Ryan Reynolds set to reprise his role as everyone’s favorite fourth-wall breaking Merc with a Mouth. This will be the first Deadpool movie made under the Marvel Studios banner with Kevin Feige at the helm. And, look, I’m a little biased here, but I love both Spider-Man: Homecoming and Spider-Man: Far From Home, which Feige also produced. So yeah, I’m pretty stoked. (Deadline)

• Chris Pratt and Vin Diesel set to appear in Thor: Love and Thunder

  • Avengers: Endgame set up the future Wild Adventures of Thor and the Guardians of the Galaxy. Now, we’re seeing that start to happen. Rumor has it that Chris Pratty (Star-Lord) and Vin Diesel (Groot) will appear in Thor: Love and Thunder. Will there be more arguments about who’s the real captain of The Benatar? One can only hope. (The DisInsider)

Streaming

• Take a look at Disney+’s new original holiday movie, Godmothered

  • It wouldn’t be the holiday season without a slew of originals on all the streamers, and Disney+ debut the first trailer for its own contribution to the season — Godmothered. The film follows Elenor (played by Jillian Bell), an inexperienced fairy godmother who’s trying to prove the world could still use some magic. The movie hits Disney+ on December 4th. (YouTube)

• My favorite goof of the week is this lovable crew member in The Mandalorian

  • In the latest Mandalorian episode, there’s a surprise appearance from a crew member who couldn’t get out of the shot in time. I love this crew member more than anything else in the world because, in many ways, we’re all this crew member. Hopefully they get their own action figure! (The Verge)

• Let’s talk about this Disney+/18+ ad going around

  • If you weren’t on Twitter this weekend, you might have missed a 30-second “leaked” commercial going around for something called Disney+ 18+. The concept is a new section of Disney+ that will feature movies and TV shows for an older or more general audience outside of Disney+’s core pillars. There’s been a lot of debate around whether or not this is real or just a really good gag. 

  • On the one hand, if it is real, it seems to confirm that Black Widow will release earlier than expected (April 16th instead of May 7th), while Falcon and the Winter Soldier will premiere on Disney+ in August. And it seems unlikely that someone would want to create a fake ad for something so product specific. 

  • On the other hand, the internet is full of gags and tricksters. If it is real, we’ll find out on December 10th. If you’re reading this and have any idea as to whether or not it’s real and want to get in touch, my DMs are open on Twitter (@loudmouthjulia)

• Hulu + Live TV price hike

  • It’s price hike season! Not long after YouTube TV increased its prices to $65 a month, and just weeks after Netflix increased its most popular plan to $14 a month, Hulu + Live TV is following suit. The virtual TV plan is increasing from $55 to $65 a month. It’s also losing more regional sports networks! Pay more, for less. Some might suggest virtual TV plans are cable but better, but it’s hard for me to see the cable replacement as anything but, well, cable. (The Verge)

Parks

• Disney wants you to know they haven’t forgotten about theme parks 

  • Disney Parks executive Josh D’Amaro gave a presentation of some pretty snazzy additions coming to the various Disney parks. The full detailed breakdown can be read on Disney’s Parks blog, but I like the less than subtle attempt to remind people that Disney Parks are still a thing, even if attendance at certain parks remain low or are closed because of the pandemic. (Disney Parks Blog)

• Leaning hard into TikTok’s Ratatouille moment

  • Theater kids everywhere have flocked to TikTok to create original songs, dances, and sets for a Ratatouille musical. The musical, based on Pixar’s 2007 film about Remy the cooking rat, is available in pieces — but it’s rad. Naturally, there was concern that Disney would come in and shut it down. Disney, like Nintendo, is notorious for these things. Instead, Disney is leaning into it with a rendition of their own posted to the Parks Instagram account. 

We truly, do, love to see it. (Vulture)