Mickey is celebrating his 100th birthday and has grown a lot in the last century. The company holds more than 30% share of the Hollywood market. Its economic, social and industrial model is a fundamental entertainment moloch that threatens to standardize and impoverish culture around the world.
The company is so important in the industry that when a small mouse makes a strategic change of orientation, the whole industry becomes breathless. © Sra Leandra Garcia/U.S. Air/ZUMA-REA
Mickey's parade. He's got what it takes. Walt Disney's company, which was founded on October 16, 1923, is celebrating its centennial from atop a dizzying pile of dollar bills. With sales of 83 billion in 2022, the entertainment multinational alone, the powerhouse of American soft power, would have about 30% market share in Hollywood.
The famous founder Walt Disney died in 1966. In 2023, the man in charge of the juggernaut is Bob Iger. A symbol in itself. At 72 years old, Disney's chairman and CEO embodies the company's formidable appetites. He's the man behind the total acquisitions made between 2009 and 2017, symbols of a voracious strategy of economic concentration - starting with competitor 20th Century Fox, which was swallowed up for a $71.3 billion check in 2017.
The ogre has grown so much under Bob Iger that it's hard to discern the boundaries of his realm. Pixar? Bought by Disney in 2006. Marvel superheroes? Acquired in 2009. "Star Wars"? In 2012. "The Simpsons," "Alien" and even the goose that laid the golden egg "Avatar"? Devoured by Mickey at the same time as Fox.
Declaring war on cinemas
We are only talking about a motion picture from which one whole economic circuit is deployed. Movies are quickly becoming franchises, broken up into series, flagship products for the Disney+ platform. This is how Disney's five "Star Wars" films and 12 franchises ("The Mandalorian", "Obi-Wan", "Visions"...) came to be.
These are then available in derivative products, figurines and other T-shirts that Disney advertises on the TV channels it owns, such as ABC or sports giant ESPN. That merchandising is then sold, especially at the six theme parks, which from Marne-la-Vallée to Tokyo to Shanghai to Florida attract nearly 100 million visitors each year.
But this circuit is destined to be disrupted. In the 20th century, Disney was one of the big names that helped make the dark room a magical place. In the 21st century, Mickey dreams of destroying movie theaters. Invent with Netflix and others a world where content is watched directly in living rooms and on smartphones, without middlemen (cinema operators, distributors, etc.) capturing a portion of the revenue.
His weapon of war: Disney+ (D+). The streaming platform, which launched in spring 2020 in France, is the next child of Bob Iger. It was even supposed to be his last post: at the end of 2019, he left his position as CEO shortly before the launch of D+, which was supposed to compete with Netflix and Amazon Prime in the video-on-demand sector. His successor, Bob Chapek, supports burying cinemas in 2020 with Covid in the background: 'Our desire is to accelerate the direct-to-consumer business (...), to drive content production by separating it from distribution to produce the content our consumers want. "
A wind of panic swept through the industry. "Much of the Western cinematic world depends on the decisions of this one actor," recalls journalist and film critic Marc Moquin. Example: France. The National Cinema Centre (CNC) collects a tax of 10.72 % from every ticket sold in cinemas, which it then reinvests in the films it finances. The success of American blockbusters thus contributes to the health of French cinema.
However, in 2022, Disney accounted for about 20% theater admissions in France. The company knows full well that if it pulls its marbles, the French cultural model will take a hit. So it plays. Especially when it comes to changing the laws in its favor.
In addition to avoiding taxes by declaring most of its European income in the Netherlands, D+ dreams of ending the so-called media chronology rule. A French specificity: streaming giants have to wait fifteen to seventeen months after a film has finished being used in cinemas in order to phase it out (historically to protect cinema from competition from TV, now streaming).
The politics of blackmail
In October 2022, it's time for blackmail. Disney is threatening France that it will not release its blockbuster "Black Panther 2" in theaters if authorities don't follow the media's chronology. The Minister of Culture, Rima Abdul-Malak, is not particularly hostile to the idea: "They are legitimate when they ask for a reduction in the distribution period," she said afterwards in exchange for a commitment on their part to invest 20 to 25 % of their turnover in French productions. The principle of the reform of the media chronology is established: "Black Panther 2" comes out.
Disney claims victory, but that masks failure. In fact, Disney+ is currently unable to generate enough profits to replace the theatrical release. The platform even sees a $1.5 billion deficit in 2022, despite 146 million subscribers worldwide.
In November 2023, D+ will raise prices for the first time to cover some losses. Another sign of the crisis is Bob Chapek being "fired" in November 2022 and replaced by... Bob Iger, who has returned to play savior. Big backpedpedaled, as Iger goes so far as to accuse the platform (which he launched) of damaging the theatrical entries of Disney films!
"Our rush to evolve our content to primarily serve our streaming offerings (...) has weakened consumer attention and focus," the big boss said this summer. It's true that the most recent releases have been commercial disappointments: 'The Little Mermaid', 'Ant-Man 3', 'Indiana Jones 5', without being industry disasters, are struggling to be profitable.
Would the public franchise strategy that Disney has put in place and that has spread throughout Hollywood tire the industry? At the moment, Mickey is reluctant to offer anything else: the agenda for the coming decade is still full of more "Star Wars", lots of Marvel movies and live-action remakes of animated classics ("Hercules", "Lilo and Stitch.")... This has ensured success and reassured shareholders. So far, at least...
A colossus with feet of clay?
Meanwhile, Disney is limping along, open to criticism of working conditions at the company. The culture of constant content flow has been at the expense of artists and employees. Many directors, such as Edgar Wright and Tim Burton, eventually slammed the door and Disney imposed overly heavy specifications.
On the "small hands" side, the teams of technicians responsible for special effects, the basic cogs in a cinema that is now essentially digital, filed for unionization in August. They decry the hellish pace, describing 16-hour days with no breaks, poor pay and poor social security.
Their demands are part of a broader context of a strike in Hollywood led by the writers (pending the September 24 agreement) and actors (still ongoing). Here again, Disney is at the centre of all the criticism for its unmeasured use of digital doubles - allowing the studio to return scenes in post-production without actors on set, but using their image at will - like artificial intelligence.
The Hollywood Reporter magazine also reported in October that Disney had finally decided to hire showrunners (essentially head writers) for Disney+. Until now, to cut costs, the company has produced its series without a true creative pilot, focusing more on brand strength than product quality. A page that appears to have been turned thanks to union mobilization.
The Walt Disney Company is not celebrating its centennial with a light heart despite its financial losses. Especially since a crazy rumor rocked the financial markets this summer. Apple would target Disney. With $400 billion in sales in 2022, Apple would almost make a mouse look like a dwarf. The vertigo of capitalism doomed to further expansion to persist, the sadness of the cultural world reduced to an accounting ballet of mergers and acquisitions. And "happy birthday" above all...
(Humanite.fr/JaC)
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