Calling the unprecedented decision to launch $200 million live-action movie Mulan direct-to-consumer via premium video-on-demand “not an easy decision,” Disney CFO Christine McCarthy told a virtual Wall Street event that a lot of factors played into the release strategy.
Speaking Sept. 9 online at the Citi 2020 Global Technology Conference, McCarthy said the decision to release Mulan as a $29.99 “Premier Access” title to Disney+ subscribers on Sept. 4 revolved around the fact that just 68% of theaters were re-opened for business, and internal data suggested consumers were hesitant to return to the cineplex during the coronavirus pandemic.
“We know what the statistics are on consumer behavior when people are asked, ‘Would you go to a theater?'” McCarthy said. “It’s gone up a bit in the last month, but a lot of that has to do with what demographic you’re in.”
McCarthy said the pandemic has taught management to “take the opportunity that this crisis is presenting,” and re-evaluate how the business units operate. For example, when internal data showed that just 40% of typical moviegoers would frequent screens at the moment, with older consumers less likely to return and younger audiences, whom McCarthy characterized as more likely doing non-approved activities such as social gatherings and partying, more likely to return to the theater — the move toward PVOD became more clear.
“Would a family with young kids go [to the theater]? Probably not,” McCarthy said.
The executive said Disney would release Mulan on Disney+ (without Premier Access) in select markets will soon have access to the SVOD platform. McCarthy said financial results for the film would be disclosed on the next fiscal call in November, adding the film’s exclusivity on Disney+ contributed to increased subscriber growth, which pleased senior management.
“But that wasn’t the driving force [for PVOD],” McCarthy said.
She said theme parks, movie and TV production return to normalcy remains on a slow path — with much dependent on the rate of COVID-19 infections and development of a vaccine.
“These are unprecedented times. We’ll have to ebb and flow as the rate of infection hopefully will stay low, but if it creeps back up, we may have to adjust accordingly,” McCarthy said.