Aug 10, 2026 · 4h 32m · acquired
Disney: The Renaissance and the Empire · Acquired
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In this comprehensive business retrospective, Acquired hosts Ben Gilbert and David Rosenthal analyze The Walt Disney Company's forty-year transformation from near-collapse in 1984 to a global entertainment empire. The episode explores how Disney built its compounding flywheel through animation, theme parks, and major studio acquisitions, while examining its high-stakes direct-to-consumer transition amid structural media disruption.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Ben and David hold 99.4% of the talking time here. How this is scored →
Ben and David as informed peer 8.4 Guest teaching 2.3 Guest disagreement 1.2 Ben and David pushing back 1.5
speaking balance: gold is Ben and David, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 4:05:25 Pushback on algorithmic reach vs movie theater distribution
Ben directly challenges David's claim that Disney content would get lost on Netflix, insisting blockbuster Disney releases would easily dominate top-10 algorithms.
Hardest push from Ben and David ▶ 4:05:30 Challenging Netflix curation vs infinite supermarket shelf spaceDavid pushes back forcefully against Ben's thesis, arguing that Netflix is an algorithmic supermarket where single movies only reach a small fraction of subscribers compared to theatrical releases.
Biggest teaching moment ▶ 45:26 The $11 billion Lion King Broadway revelationDavid stuns Ben with the data point that The Lion King musical has grossed over $11 billion lifetime, making it the highest-grossing single entertainment product in human history.
Ben and David hold their own ▶ 3:58:10 Theatrical film distribution represents only 3% of DisneyBen cites primary SEC reporting data demonstrating that despite public perception, theatrical distribution generates only 2.6 billion dollars out of Disney's 94 billion dollar revenue base.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Ben and David as informed peer | Guest teaching | Guest disagreement | Ben and David pushing back | Why |
|---|---|---|---|---|---|---|
| Disney's 1984 Crisis and the Bass Family Intervention | 8 | 3 | 1 | 1 | Ben and David demonstrate deep archival mastery of the 1984 takeover crisis, citing specific stock drops from $82 to $52, operating numbers, and board negotiations. The dynamic is highly collaborative as they weave together the CalArts talent pipeline and the boardroom coup that brought in Michael Eisner and Frank Wells. | |
| Parks Price Hikes and the Live-Action Hit Strategy | 8 | 2 | 1 | 2 | The hosts detail Eisner and Wells' immediate operational fixes, including raising park admission and parking fees from $1 to $5. Ben clarifies how Silver Screen Partners financed the live-action slate while David outlines the hit rate of their singles-and-doubles strategy. | |
| The Disney Animation Renaissance: From Mermaid to Lion King | 9 | 2 | 1 | 1 | Ben shares primary research from a breakfast interview with Jeffrey Katzenberg, detailing the structural shifts led by Peter Schneider, Howard Ashman, and Alan Menken. They analyze the CAPS software integration and the budget economics of the Disney Renaissance. | |
| Expanding the Flywheel: Home Video, Retail Stores, and Broadway | 9 | 4 | 1 | 2 | David reveals the astonishing $11 billion lifetime gross of The Lion King on Broadway, catching Ben off guard by showing it out-grossed Avatar and Avengers. They break down the massive unit sales and margins of VHS releases like Cinderella and Aladdin. | |
| Transforming Theme Parks into Mega-Resorts and 1994 Financial Peak | 8 | 2 | 1 | 1 | David outlines the transformation of Disney World from standalone theme parks into comprehensive vacation resorts under Eisner. They detail the successive tragedies of 1994, including Frank Wells' death and Jeffrey Katzenberg's departure to start DreamWorks. | |
| The ABC Capital Cities Acquisition and the ESPN Cash Machine | 9 | 3 | 1 | 1 | Ben and David dissect the 1995 ABC Capital Cities transaction and reveal how ESPN's dual revenue model created unprecedented leverage over cable operators. Ben provides data showing cable networks drove 60% of Disney's operating income from 2008 to 2011. | |
| Dot-Com Distractions, the Spurned AOL Merger, and the Michael Ovitz Disaster | 8 | 2 | 1 | 1 | The hosts review Eisner's dot-com era moves, including rejecting the disastrous AOL merger, alongside the brief, expensive tenure of Michael Ovitz. They discuss the post-9/11 tourism collapse and the Bass family margin call that destabilized Eisner's shareholder base. | |
| The Shareholder Revolt and Comcast's Hostile Takeover Bid | 9 | 2 | 1 | 1 | Ben reads directly from Bob Iger's account of Roy E. Disney's blistering resignation letter and the SaveDisney.com proxy campaign. They analyze Comcast's $54B hostile takeover bid and the 43% withhold vote that forced Eisner out as chairman. | |
| Bob Iger's Three-Pillar Campaign and the End of the Eisner Era | 9 | 2 | 1 | 2 | David analyzes Bob Iger's three-pillar campaign to win the CEO post despite being Eisner's COO, focusing on IP creation, technology adoption, and international expansion. Ben evaluates Eisner's final scorecard, noting the 26x growth in net income across 21 years. | |
| The Origins of Pixar: Lasseter, Catmull, Lucasfilm, and Steve Jobs | 9 | 2 | 1 | 1 | Ben traces the origins of Pixar through Lasseter, Catmull, Lucasfilm, and Steve Jobs' initial $5M purchase in 1986. They highlight the pivotal intersection between computer hardware R&D, Disney's CAPS system, and early CG demonstrations like Luxo Jr. | |
| Inside Pixar's 3D Animation Pipeline and the Inception of Toy Story | 9 | 2 | 1 | 1 | Ben walks step-by-step through Pixar's proprietary 7-step animation pipeline, citing their on-site research at Pixar and S-1 IPO filing data. David notes the critical distinction between rendering virtual 3D universes and traditional 2D hand-drawn frames. | |
| Toy Story Production Crisis, Box Office Triumph, and Pixar's IPO | 8 | 2 | 1 | 1 | The hosts describe the initial 'Black Friday' screening disaster for Toy Story, the subsequent rewrite, and Steve Jobs' calculated decision to take Pixar public the week after the film's premiere. David notes how the IPO made Jobs a billionaire. | |
| The Breakdown of the Disney-Pixar Relationship and Circle 7 | 9 | 3 | 1 | 2 | David and Ben track the escalating friction between Steve Jobs and Michael Eisner over Toy Story 2 sequel accounting, Rip/Mix/Burn piracy debates, and Finding Nemo's leaked memo. They review Pixar's dramatic public statement ending negotiations in 2004. | |
| Disney's $7.4 Billion Pixar Acquisition and Animation Revival | 9 | 2 | 1 | 1 | Ben recounts primary interviews with Bob Iger and Kristen Bell about the structural changes implemented when Disney acquired Pixar for $7.4B. They explain why Pixar could not have survived as an independent full-stack competitor after Jobs' cancer diagnosis. | |
| Sponsor Break: Anthropic's Claude AI for Primary Research | 4 | 1 | 0 | 0 | The hosts deliver a sponsor message for Claude AI by Anthropic, illustrating how they used Claude to reconcile conflicting 1940 box office statements for Snow White during primary research. Transitioning back, they introduce the Marvel acquisition. | |
| Reviving the Disney Flywheel with ESPN's Cash | 8 | 2 | 1 | 1 | David and Ben discuss the $4B Marvel and Lucasfilm acquisitions and examine how ESPN's massive cable cash flows effectively paid for all three acquisitions within four years of cable profits. They review the commercial performance of Frozen and MCU box office. | |
| Building DTC Infrastructure: From Twitter to BAMTech | 9 | 2 | 1 | 1 | The hosts detail the August 2015 inflection point when ESPN sub losses triggered a broader media sell-off. They recount the near-acquisition of Twitter, the acquisition of BAMTech, and the $71.3B bidding war with Comcast for 21st Century Fox assets. | |
| Disney+ Launch and Hidden Cracks in Core Studios | 9 | 2 | 2 | 2 | David quotes Ben's 2019 prediction warning that streaming requires a constant content treadmill orthogonal to Disney's scarce flywheel. They analyze the creative strain on Marvel, Star Wars, and Pixar when forced to rapidly churn out streaming content. | |
| ESPN's Structural Decline and Escalating Rights Costs | 8 | 2 | 1 | 1 | Ben and David analyze how tech bidders like Amazon drove up NFL rights costs while cable subscriber losses eroded ESPN's pricing power. They discuss COVID shutdowns, the Chapek reorganization, and Iger's return out of retirement. | |
| Restructuring, NFL Partnership, and Josh D'Amaro Succession | 8 | 2 | 1 | 2 | David and Ben review the NFL's 10% equity stake in ESPN, the bundling of ESPN Unlimited to fight churn, and the appointment of Josh D'Amaro as incoming CEO alongside Dana Walden as president. | |
| Financial Realities: Streaming Scale, Parks Dominance, and Theatrical Decline | 9 | 3 | 1 | 1 | Ben highlights the striking shift in operating income: Experiences generates $10B in profit (nearly 60% of Disney's total) while theatrical box office accounts for just 3% of revenue. They contrast Disney's $1B DTC profit with Netflix's $13.5B. | |
| Strategy Breakdown: Evaluating the Direct-to-Consumer Imperative | 9 | 4 | 4 | 4 | David and Ben debate whether Disney could have remained a boutique licensing studio on Netflix instead of building a full direct-to-consumer competitor. Ben challenges David's thesis about algorithmic discovery, arguing premium Disney hits would naturally top Netflix rankings. | |
| Bull and Bear Cases: Franchise Fatigue vs. Generational Myths | 8 | 3 | 3 | 3 | Ben presents the bear case on franchise fatigue and lack of post-2016 original IP, while David argues generational myths are unkillable luxury brands that inevitably cycle back. David playfully pitches hypothetical acquisitions of Bluey and Nintendo. | |
| Seven Powers: Cornered Resources vs. Streaming Scale Economies | 8 | 2 | 1 | 2 | In the Seven Powers and Quintessence analysis, the hosts compare Disney's cornered resource IP against Netflix's scale economies. They conclude that the 1990s and 2010s were structural golden eras in media economics that will never be replicated. |
Statements from this episode (96)
Gilbert: Disney lost billions over half a decade transitioning to streaming
“They're in the midst of a transition to streaming with Disney Plus and Hulu. And ESPN making giant technology and marketing investments to support that transition that lost billions for half a decade.”
Rosenthal: Bass family acquired ~25% stake in Disney in 1984
“And in the midst of all this, desperate to ward off these corporate raiders, management strikes a series of friendly deals with four oil and gas and real estate brothers in Fort Worth, Texas, the Bass family and their famous investment manager, Richard Rainwat…”
In 1984, Disney parks earned $250M while film and TV earned $2M
“In 1984, Disney generated a quarter billion dollars of profit from its parks and consumer products, and a mere two million from film and TV.”
Walt Disney left roughly half of his estate to fund CalArts
“That was why Walt created CalArts. He wanted it to be this institution that would keep the pipeline of new animation talent flowing into Disney long after he was gone, and Walt left like half of his estate
To fund this institution.”
Disney fired John Lasseter, Tim Burton, and Brad Bird early on
“I mean, so there's people I mentioned, John Lasseter, Brad Bird, Tim Burton, John Musker, Brenda Chapman, all of them were hired directly by Disney and Disney Animation right out of school, and then Disney fired all of them.”
Rosenthal: Eisner and Wells were the greatest media management duo
“Arguably the greatest two-person management team in media company history, Michael Eisner and Frank Wells.”
Disney park ticket prices remained essentially flat from 1966 to 1984
“Ticket prices at the Disney parks have basically been flat since Walt died.”
Gilbert: Silver Screen financed all 75 Disney films over eight years
“So for each of the films, all 75 films they would make over the next eight years, those were financed by a partner called Silver Screens.”
Disney's live-action film studio hit a 27-of-33 profitability run under Eisner
“All told, 27 of their first 33 movies that they make are profitable, which, in Hollywood, to have a hit rate like that, that's like making 33 venture capital investments and only losing money in six of them.”
Rosenthal: Roy E. Disney demanded chairmanship of animation when Eisner joined
“Roy had made them promise not to fully kill animation, and then he had made them make him, Roy, chairman of the animation division, under Katzenberg, who's running all the studios.”
Walt Disney Animation released only three movies between 1971 and 1984
“Disney Animation had only released three movies from 1971 to 1984, and they had a film called The Black Cauldron in development for nearly a decade.”
The Little Mermaid grossed less than When Harry Met Sally in 1989
“The Little Mermaid made less money than When Harry Met Sally in 1989.”
Gilbert: Beauty and the Beast grossed $330M on a $25M budget
“Three hundred and thirty million gross at the box office on a twenty-five million dollar production budget.”
Gilbert: Aladdin grossed $500M on a $28M production budget
“1992 with Aladdin. Box office. Five hundred million is what I saw, right? That's right. Half a billion. On a twenty-eight million dollar production budget.”
Gilbert: The Lion King brought in $750M at the box office
“This brings in seven hundred and fifty million dollars.”
Gilbert: The Lion King is the top hand-drawn animated film in history
“The most successful, traditionally animated, hand-drawn film in history.”
Gilbert: Beauty and the Beast featured Disney's first 3D animation
“The background of that Was actually three D rendered using Pixar software. And then they composited using caps, a two D hand drawn bell and the beast dancing. And that is the first time they used any three D animation in any Disney films.”
Rosenthal: Home video became Disney's second-largest profit center after parks
“So home video quickly becomes a billion dollar business for the Walt Disney Company. It's the second biggest profit center for the whole company after the theme parks.”
The Lion King is the best-selling VHS tape in history
“And then The Lion King eclipses it in 1995 when it comes out on VHS with thirty-two million units. The best-selling VHS of all time period in history ever.”
Rosenthal: Disney built more than 750 retail stores across America
“So, they build more than 750 Disney stores, retail stores, in, in, like, basically every mall in America.”
The Lion King musical is history's highest-grossing single entertainment product
“The Lion King musical has grossed over eleven billion dollars in total revenue in its run, which I think makes it the single highest grossing entertainment product in history, in any medium, film, music, TV, video games, other Broadway shows.”
Rosenthal: Disney Parks generated $10B in operating profit last year
“Last year, Disney Parks and Experiences contributed ten billion dollars in operating profit to Disney.”
Rosenthal: Euro Disney cost $4B to develop and lost money for years
“There is Euro Disney which costs four billion dollars to develop and just loses money for years.”
Rosenthal: Disney operating profit increased nearly 8x between 1984 and 1994
“Operating profit at the company goes from well under three hundred million when they take over in 1984 to just under two billion a decade later. So, you know, almost, what's that, eight X operating profit in a decade.”
By 1994, Disney's market cap topped all other traditional media companies
“So by 1994, Disney's market cap hits twenty two billion dollars, up 10 X from when the Eisner crew took over, and it becomes the highest valued Of all the traditional media companies, more valuable than Time Warner, more valuable than Viacom, more valuable tha…”
Disney settled Jeffrey Katzenberg's bonus lawsuit for a reported $280 million
“He also sues the Walt Disney Company for bonuses that he was owed. They end up settling that lawsuit many years later for a reported two hundred and eighty million dollars.”
Rosenthal: Disney's $19B ABC deal was history's second-largest acquisition
“Michael strikes a deal for the Walt Disney Company to acquire ABC Capital Cities for nineteen billion dollars, which was the second largest acquisition in history to that point.”
Cable operators pay ESPN an average of $9.42 monthly per subscriber
“Nine dollars and 42 cents per month per subscriber that the cable operators pay ESPN.”
ESPN and cable networks drove 60% of Disney's operating income from 2008-2011
“So we're flashing forward, but later on, in the 2008 to 2011 time frame, Disney's cable networks segment, of which analysts believe that three quarters of the cable network segment is ESPN, that segment accounted for 60% of the entire company's operating incom…”
AOL's Steve Case pitched Michael Eisner on a merger before Time Warner
“Steve Case approached him before Time Warner about an AOL Disney combination.”
Michael Ovitz lasted one year as Disney president, exiting with $140M severance
“So Ovitz lasts just over a year at Disney and leaves in December, 1996 with a hundred and forty million dollar severance package.”
Gilbert: Poor animation quality creates delayed financial fallout for Disney
“Because they don't make most of their money from actual profits at the box office when the movie comes out the first time, There's a delayed impact to animation sucking that doesn't show up in the financials until way later.”
Rosenthal: Disney stock fell nearly 25% following 9/11 attacks
“Disney stock falls nearly 25% in the days after the September 11th attacks.”
Rosenthal: Bass family was forced to liquidate $2B in Disney shares
“In the days after September 11th, they face a margin call on their other investments. They have to become forced sellers of two billion dollars worth of Disney shares, which puts even further downward pressure on the Disney stock, which has already just fallen…”
Rosenthal: Roy Disney launched SaveDisney.com campaign to oust Eisner
“Roy and Stanley gold, his business partner, who also resigns from the board would promptly turn around and launch a first of its kind public grassroots shareholder campaign with the website, savedisney.com. With the stated goal of mounting a proxy vote to oust…”
Comcast launched a $54B hostile stock bid for Disney in 2004
“Comcast, the Philadelphia based cable company,
Is making a hostile takeover bid to acquire Disney for fifty four billion dollars in Comcast stock.”
Rosenthal: 43% of Disney shareholders withheld support for Eisner in 2004
“At the end of the day, 43% of the shareholder base votes to withhold support for Eisner as CEO, which is a huge number.”
Gilbert: Acquiring Capital Cities/ABC Cost Disney Its Strategic Clarity
“It was because it had ESPN, but it also cost the company It's strategic clarity. Disney never again would get to be just Disney. It's the flywheel business and the ESPN affiliate slash advertising cable business. And it's worth it because buying ESPN was this …”
Gilbert: Michael Eisner Grew Disney Revenue From $1.7B to $31B
“By the numbers, Michael's tenure was unbelievable. He comes in with a market cap a little shy of two billion, leaves with it worth, I don't know, fifty-ish billion. I think there was some dilution, so it wasn't quite a 25 X, closer to a twenty-X of the stock. …”
Iger secretly concluded Pixar's leadership needed to replace Disney Animation
“So during his CEO audition process, Bob Iger had completely lost faith that Disney animation can be fixed from within. And secretly he concludes that the only viable path to restore Disney animation to its proper glory is to replace the entire leadership team.…”
Gilbert: Jobs Paid $5M to Lucas and Invested $5M for 70% of Pixar in 1986
“He writes in 1986 a five million dollar check to George Lucas to buy the company. Another five million dollar check into a new entity that he just created to fund the company. It's formally named Pixar, and it is owned 70% by Steve Jobs and 30% by employees.”
Gilbert: Pixar's first customer check came from Disney for CAPS
“The first check to Pixar Inc. Is from Disney to work with them and create the CAPS system for improving their two D animation.”
Gilbert: Pixar only ever sold around 300 Pixar Image Computers
“These image computers are insanely expensive. They've only sold, like, 300 of them ever.”
Gilbert: Toy Story rendering required 117 Sun computers running hours per frame
“In those days, each frame would take an hour or two to render, and they could only render like three and a half minutes of footage per week. They were on this Sun Microsystems hardware that was state of the art at the time, and they had a 117 of them clustered…”
Gilbert: Toy Story was the first non-Disney animated blockbuster
“It made twenty-nine million in its opening weekend, went on to become the number one film in the U.S., and it was the first ever animated film That was a blockbuster that was not created by Disney.”
Pixar's IPO made Steve Jobs a billionaire, creating more wealth than Apple
“Pixar closes its first day of trading, At a one and a half billion dollar market cap, this is how big a hit Toy Story was and how much it was in the public consciousness. This is how Steve Jobs becomes a billionaire... He didn't make anywhere near that kind of…”
Pixar's 1995 IPO was larger than Netscape's
“So that hundred and forty million they raised makes it the largest IPO of the year. Larger than Netscape.”
Gilbert: Jobs invested $54M over 9 years and owned 78% of Pixar at IPO
“The numbers on Steve, he bought the company for five million dollars. He actually did dump fifty four million dollars into it. Over nine years. He was, like, wiring money for payroll and stuff like that, and on IPO day, he owned 78% of the company.”
Rosenthal: Disney and Pixar sold 65 million copies of Finding Nemo DVD
“Disney and Pixar would sell 65 million copies of the Finding Nemo DVD, all told, you know, across all, all timeframe.”
Gilbert: Pixar generated up to half of Disney Studios' operating income
“Pixar films have accounted for as much as half of the studio, Walt Disney's, operating income in recent years.”
Steve Jobs demanded 100% of Pixar film profits in renegotiation with Disney
“He proposes a deal to Eisner, and this is where the relationship becomes irreparable. Pixar should actually be getting a hundred percent of the profits, not 50%, and they're now prepared to fund the budget themselves, too. Disney would just get a 10% distribut…”
Disney secretly formed Circle 7 Animation to make Pixar sequels without Pixar
“Disney actually does start a new studio inside the company called Circle Seven Animation. That will be tasked with developing, right away, Toy Story III, Monsters, Inc. II, and Finding Nemo II.”
Gilbert: Toy Story franchise generated at least $3.5B in direct revenue for Disney
“Toy Story alone did over four billion at the box office, which means one and a half to two billion to Disney. Thirty billion in retail sales so far. Lifetime of all Toy Story consumer goods. So with Disney's five percent licensing fee on that, that's another t…”
Top weekly Disney+ movies are consistently Pixar and Disney Animation
“We've heard that the vast majority of the top 15 movies viewed every week on Disney Plus are either Pixar or Disney Animation. Not live action, not Star Wars, not The Avengers. The stuff that kids watch over and over. And those Disney animation movies are all …”
Gilbert: MCU became highest-grossing film franchise at nearly $32B box office
“By twenty-twenty-five, the Marvel Cinematic Universe
Has become the most successful film franchise in history.
Generating nearly thirty-two billion dollars at the box office.
That's more than Star Wars.
That's more than James Bond.”
Gilbert: Disney should have paid far less for Lucasfilm than Marvel
“Turns out they should have paid well less than whatever they were willing to pay for Marvel, too.
Because Star Wars just didn't turn out to have that much more exploitation ahead of it.”
Rosenthal: Disney sold 3M Frozen dresses in the movie's first year
“After Frozen comes out, Disney sells three million Elsa and Anna dresses in the first year after the movie's released.”
By 2015, Disney generated over $50B annually in gross retail merchandise sales
“By 2015, Disney is doing over fifty billion dollars a year in gross sales at retail of merchandise up almost two X over the past five years.”
Rosenthal: Frozen soundtrack was 2014's top album, outselling Taylor Swift's 1989
“The frozen soundtrack is the best selling album of 2014. Selling ten million copies with streaming equivalents in there. Even beating 1989 from Taylor Swift.”
Rosenthal: Disney grew market cap from $50B to $200B from 2005-2015
“Disney's market cap is up four X to two hundred billion dollars up from the fifty billion dollars when Bob took over. Overall revenue grows from thirty two billion to fifty two billion. Operating income goes from 4.7 to 14.7 billion.”
ESPN's cash flow fully funded Disney's Pixar, Marvel, and Lucasfilm acquisitions
“If you go line up those three acquisitions, which sound ludicrous on their price tags, especially when you didn't know how they were gonna pay off, Pixar at 7.4 billion, let's even include the cash in there, that's about two and a half years of cable's then pr…”
Rosenthal: ESPN lost 3 million subscribers in 2015, falling to 92M
“It would come out later in Disney's annual report that ESPN lost three million subscribers that year. Which still meant it had ninety-two million in total.”
Gilbert: Disney's stock price in 2026 is flat compared to 2015
“Disney's stock price today is what it was then. Yep. It's gone up and down, but it is flat to 11 years ago.”
Rosenthal: Traditional media companies except Disney are serfs to Netflix and YouTube
“All of these traditional media companies, with the exception of Disney, have basically all become kind of surfs in the streaming kingdoms of the technology companies, of which Netflix and YouTube are actually the winners here.”
Gilbert: Netflix, YouTube, and Disney Generate Hollywood's Major Profits
“If you just do the very simple exercise of looking who generates profits in the movie TV Hollywood landscape right now, it is Netflix, YouTube, and Disney generating the large profit streams.”
Rosenthal: Disney Retained Fox Assets Generated Nowhere Near $44B in Value
“And they probably don't get anywhere near forty four billion dollars worth of value out of the assets that they do get.”
Rosenthal: Disney Merged Fox India Assets with Reliance at Huge Markdown
“Those assets end up not performing for Disney nearly as well as they thought they would. They end up merging them with Reliance in twenty-twenty-four in a deal that values them at only a fraction of what they value them in the Fox acquisition.”
Gilbert: 21st Century Fox Is Disney's Worst Major Acquisition
“But certainly it's the worst of the four big acquisitions, five if you include BamTech.”
Rosenthal: Disney+ hit 10 million signups in 24 hours
“Disney gets ten million signups within the first 24 hours. Twenty-six million in the first quarter.”
Marvel's post-2021 theatrical film slate might actually have a negative return
“And if you do flash forward, the post 2021 movie slate might actually be negative on a theatrical return.”
Gilbert: Disney+ series diluted the Marvel Cinematic Universe's stakes
“This is even ignoring the Disney Plus shows, some of which were very cool, Loki and WandaVision, but the existence of them by trying to be bigger and broader and more expansive even than the movies make the original universe feel unimportant.”
Streaming's high-volume content firehose fundamentally breaks Disney's historical IP flywheel
“That whole strategy of a fire hose of content is completely orthogonal to the flywheel strategy of only the best content very infrequently.”
Netflix functions as a utility button, not a brand with emotional equity
“The Netflix brand doesn't mean anything to anyone. The Netflix brand is the button that I push on my TV when I want to watch stuff. And sometimes it's great stuff, but if it's not great stuff, whatever. It whizzes by. I don't think one way or another about Net…”
Gilbert: ESPN's Monday Night Football package cost hit $2.7B annually in 2021
“So in 2006, just look at the Monday Night Football package that ESPN buys. O six, it was a 1.1 billion. 20 11, it was at 1.9 billion a year. And by 2021, it went up to 2.7 billion dollars a year now.”
Gilbert: Sports leagues will capture all long-term excess broadcasting profits
“So in the long run, if the main reason to subscribe to any given channel ends up being actually about the game content itself and not differentiated by stuff around the game, then the excess profits in the long term Will just be captured by the rights holders …”
Rosenthal: Sports content cannot build compounding value like Disney's flywheel
“Sports have a very limited shelf life. You are not going back and watching Manning cast episodes from last season. The flywheel does not apply here. So you can't build long-term value around that original content.”
Disney+ Reached 100M Subscribers Within 16 Months
“When they announced Disney Plus originally, Disney said that their goal was to get 60 to ninety million subscribers within five years. All of a sudden, COVID happens. Everybody's sitting at home. Disney gets a hundred million subscribers within 16 months.”
Gilbert: Streaming Is Structurally Inferior to the Cable Bundle
“It's structurally a worse business, as you were just mentioning, than the old cable bundle where you just got checks. Consumers can cancel easily. They do so every few months. It's expensive to make The amount of content you need to make, especially now with t…”
Gilbert: Iger Erred by Appointing Chapek for Peacetime
“Ultimately, I kind of think they just chose the wrong guy in Bob Chapek, and I think Iger's mistake in recommending Bob Chapek for the job was thinking that the company was about to enter a peacetime.”
Gilbert: ESPN generates three billion dollars annually in operating income
“Yeah, it's a declining asset that does three billion dollars a year now in operating income.”
Rosenthal: NFL traded NFL Network to ESPN for a 10% stake
“In twenty-twenty-five, they do a deal with the NFL. The NFL trades, the NFL network cable channel, Into ESPN in return for a 10% stake in ESPN itself.”
Gilbert: Disney net income grew fivefold to $12.4B under Iger
“Revenue tripled from thirty one billion in 2005 to 94,000,000,020 years later, and net income went from 2.5 billion to 12.4 billion. So interestingly, net income outpaced revenue. They became five times more profitable while generating three times more revenue…”
Gilbert: Netflix's operating income matches Disney's total company operating income
“Netflix's operating income on streaming, their entire business is the same as Disney's entire company operating income.”
Disney incurred approximately $13 billion in cumulative operating losses building streaming
“Cumulatively, there were thirteen billion dollars or so of losses that Disney incurred in building it out in that segment.”
Gilbert: Disney committed $60B over a decade to parks and cruises
“So in 2023, they announced That they're investing sixty billion dollars of capital expenditures over the next decade into parks and cruises.”
Parks and cruises now account for almost 60% of Disney's total profits
“Almost 60% of the profits of the entire company come from parks and cruises.”
Gilbert: Original Pixar films have set no box office records in a decade
“If you look at the new Pixar films developed in the last 10 years, nine, 10 years, none of them have set new records. The only record setters and real smash hits are these sequels.”
Keeping content exclusively on Disney+ severely limits Disney's downstream IP monetization
“So they do have Disney Plus. It does have a hundred and thirty million people subscribed, but a 130 is not 350. And so your content that you want to drive people to the parks and to merch is only reaching 40% of the people that it could if it were on Netflix, …”
Gilbert: Winning streaming services must offer broad, 'kitchen sink' content catalogs
“If you want to operate a streaming service that gets to scale, and if you're going to operate a streaming service, it has to get to scale since the fixed costs are so high. Then you must have a broad set of content. That is weird. That it must be a broad set o…”
Gilbert: Every Disney box-office hit after 2016 harvested existing IP
“Everything I can think of that did big dollars after 2016 at the box office, and I picked 2016 because that's when Moana and Zootopia came out. Everything after that that was big box office for the company is harvesting existing IP.”
Rosenthal: Major entertainment franchises are unkillable like luxury brands
“I think these franchises, whether it's core Disney, Pixar, Lucasfilm, Marvel, are just like luxury brands. You cannot kill them. They will have uptimes and they will have downtimes, but they will always come back.”
Gilbert: Disney will set an all-time net income record in 2026
“But I think in 20, 26, it's looking like they'll set a brand new net income record ever based on the way it's trending.”
Nintendo's intellectual property rivals Pixar, Marvel, and Lucasfilm combined
“Nintendo is like Pixar, Marvel, and Lucasfilm combined. I mean, they have some of the very best IP in the entire world. They've got three franchises that can stand toe to toe with anything at Disney in Mario, Zelda, and Pokemon.”
Rosenthal: Disney's Best Streaming Strategy Is to Be Number Two
“Yeah, I think Disney's best bet here is to be a clear number two.”
Gilbert: Disney's historic profit eras were structural anomalies
“Disney's gonna be fine, and if managed very carefully, thrive. They're still gonna produce beloved characters and stories we all love, But the prosperity from the late nineties and the 2005 to 20 19 era, that was a complete anomaly due to how good all the stru…”