Disney Extends CFO Christine McCarthy’s Employment Contract Into 2024

The Walt Disney Co. Dec. 21 announced it has extended CFO Christine McCarthy’s contract through June 30, 2024. McCarthy is a 22-year veteran of the company and has served as CFO since 2015.

“Christine’s leadership has been indispensable during this time of disruption and transformation, and her impact reaches well beyond our balance sheet,” CEO Bob Chapek said in a statement. “She has been instrumental to Disney’s growth and helped us navigate the most difficult days of the pandemic.”

As CFO, McCarthy oversees Disney’s worldwide finance organization, which includes brand and franchise management, corporate alliances and partnerships, corporate real estate, corporate strategy and business development, enterprise controllership, enterprise technology, financial planning and analysis, global product and labor standards, investor relations, risk management, tax and treasury.

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McCarthy joined Disney in 2000, and prior to becoming CFO she was EVP of corporate real estate, alliances and treasurer. She currently serves on the board of directors of The Procter & Gamble Company and FM Global, and is a trustee of Carnegie Institution for Science. She has received numerous awards and has been named multiple times to Treasury & Risk’s “100 Most Influential People in Finance,” the Top 100 Irish American Business Leaders, and Business Insider’s “The 15 Most Influential Women in Finance.” In 2015, she was the recipient of Treasury Today’s Adam Smith “Woman of the Year” award. In 2016, she received Los Angeles Business Journal’s “Executive of the Year” award and was honored as one of the Entertainment Diversity Council’s “Top 50 Most Powerful Women in Entertainment.”

Parrot Analytics: Disney+ Second Only to Netflix in U.S. Originals Demand

Disney+ is the second-most in-demand platform for original series with U.S. audiences. and The Walt Disney Company is in first place in corporate demand share, according to data from Parrot Analytics.

Disney+ became the second-most in-demand streaming service for original content with American audiences for the first time ever last quarter with an 8.9% share, leaping over longtime second place holder Amazon Prime Video with 8.6%, according to Parrot.

Disney remains far and away the top media conglomerate in the United States when it comes to corporate demand share — a consolidation of original demand where platforms are combined based on their corporate parent, according to Parrot. Disney’s 20.1% share last quarter was well ahead of second place ViacomCBS (13.1%). Disney’s share is larger than the combined share of WarnerMedia and Discovery (12.1% + 7.1% = 19.2%), which are in the process of merging. Collectively, the six largest media corporations control almost three quarters of U.S. demand for TV series, while 27.4% of audience attention goes to originals from other platforms.

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Parrot also found:

  • Disney is in second place in overall demand for original children’s content.
  • Disney+ and Hulu originals accounted for five of the six most in-demand new series released in the U.S. in the last quarter.
  • Disney+ accounted for four of the 10 most in-demand digital original series with both U.S. and worldwide audiences last quarter. 

ViacomCBS to Acquire Stake in Spanish-Language Content Producer

ViacomCBS Networks International (VCNI) has entered into a definitive agreement to acquire a majority stake in the Spanish-language content producer Fox TeleColombia & Estudios TeleMexico from The Walt Disney Co. and the founding family of Fox TeleColombia & Estudios TeleMexico.

ViacomCBS International Studios’ VIS, a division of VCNI, will operate Fox TeleColombia & Estudios TeleMexico as a collaborative partnership with the founding family. The transaction is subject to regulatory approval and customary closing conditions.

Through this transaction, VCNI will gain access to Fox TeleColombia & Estudios TeleMexico’s studio operations in both Colombia and Mexico, as well as many hours of library content, including premium series, telenovelas, films, documentaries, unscripted, kids and family, branded and digital content, and live sports shows produced for various audiences. This content will fuel ViacomCBS’s global streaming platforms including Paramount+ and Pluto TV, and its linear networks around the world, according to the company. Fox TeleColombia & Estudios TeleMexico will also bolster ViacomCBS’ Spanish-language content production capabilities to capitalize on significant content demand in the region and worldwide, the company noted.

“The acquisition of Fox TeleColombia & Estudios TeleMexico, combined with ViacomCBS’s existing Spanish-language portfolio including Telefe and Chilevisión, reinforces the company’s position as a leading worldwide producer of Spanish-language content,” Raffaele Annecchino, president and CEO, ViacomCBS Networks International, said in a statement. “This content will fuel ViacomCBS’ global ecosystem across Paramount+, Pluto TV and its linear networks.”

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“This announcement is very fulfilling and I feel very honored that Fox TeleColombia & Estudios TeleMexico will continue its expansion and growth in the hands of such an amazing company as ViacomCBS and its talented and visionary executives,” Samuel Duque Rozo, founder and CEO of Fox TeleColombia & Estudios TeleMexico, said in a statement. “The extraordinary work that our team has made during all these years, combined with ViacomCBS’s vision, iconic brands, experience, professionalism, creativity among much more, will bring nothing less but the best for both businesses.”

Rozo will continue to exclusively support the business from a creative and strategic advisory position, and Samuel Duque Duque, current president, will lead the business. Fox TeleColombia & Estudios TeleMexico will fall under the remit of Juan “JC” Acosta, President of ViacomCBS International Studios and Networks Americas.

The terms of the transaction were not disclosed.

Bob Chapek: Pandemic Brought Flexibility to Disney Content Distribution

As Hollywood puts the pandemic in the rear-view mirror, Disney, like other studios, has revisited its distribution strategy of original movies and TV shows. Speaking May 24 on the virtual JPMorgan 49th Annual Global Technology, Media and Communications Conference, CEO Bob Chapek said the pandemic put renewed focus on how consumers want to access content, rather than traditional norms revolving around the 90-day theatrical window.

“One of the things we learned is flexibility is good because there’s two dynamics going on: One is people’s willingness to return to theaters and theaters’ ability to return in a meaningful way,” Chapek said. “And then the second is the change in consumer behavior that’s happening naturally, with COVID probably acting as a bit of a catalyst, but was going to happen anyway.”

Disney is returning to the movie theater in late summer with exclusive (and curtailed) 45-day windows for 20th Century Studios’ Free Guy and Marvel Studios’ Shang-Chi and the Legend of the Ten Rings. Free Guy launches on Aug. 13 and Shang-Chi on Sept. 3. The films mark Disney’s first exclusive theatrical releases since the Aug. 28 release of The New Mutants.

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Other theatrical titles Cruella (May 28), Black Widow (July 9) and Jungle Cruise (July 30) will debut in cineplexes and on $29.99 Premier Access via Disney+ simultaneously.

“We’re trying to offer consumers more choice as they gain confidence in how they want to go ahead and return to theaters,” Chapek said, adding that consumer return to the box office has been stronger in select international markets.

“We’re seeing some hesitancy to return [to movie theaters] in a way that would look anything like normal back in 2019,” he said. “And as such, during this sort of interim period, it’s really nice to be able to give consumers some flexibility.”

Marvel Studios’ Black Widow

When asked why a theatrical tentpole title like Black Widow would get concurrent purchase access on Disney+, Chapek said the Marvel Universe movie, starring Scarlett Johansson, had been delayed twice — and a third delay was not an option.

“At the same time, we always knew that there was a risk that exhibition wasn’t going to be fully developed or that consumers wouldn’t want to go back and sit in the theater,” he said. “We realized we had to sort of ‘prime the pump’ and give theatrical exhibition a chance, but we couldn’t put all our eggs in the exhibition basket, because we knew that in the weeks leading up to the decision, the domestic market was not coming back and is still fairly weak. We’re really confident we made the right call there.”

Pixar Animation’s Luca

The June 18 release of Pixar Animation’s Luca direct to Disney+ without a $29.99 purchase fee, and bypassing theatrical surprised some observers. Chapek said the decision revolved around keeping Disney’s evolving distribution channels stocked.

“We’ve increased our investment in creative content to ensure that all channels have a full complement of offerings to sort of keep everybody happy,” he said. “We want to make sure, given the importance of Disney+ in the marketplace and our shareholders, that we keep feeding that machine.”

Indeed, Disney’s Christmas Day release of Pixar’s Soul was topped only by Warner’s same-day release of Wonder Woman 1984 on HBO Max.

“We believe that Luca will get a lot of eyeballs,” Chapek said.

Disney’s Star+ to Bow Aug. 31 in Latin America

Star+ will launch in Latin America on Aug. 31 as a standalone streaming service that will offer a full slate of ESPN content, including live events from the top leagues and sports shows; series, animated comedies, movies and documentaries; and regional and international original Star productions, including exclusive content, Disney Media & Entertainment Distribution announced May 14.

“Star+ will offer a never-before-seen customized experience and will expand our connection with the different audiences,” Diego Lerner, president of The Walt Disney Company Latin America, said in a statement. The strength of the content, that will include all of ESPN, makes Star+ a unique and relevant offering with its own identity that will become a recognized digital service, independent from Disney+. Having said that, its arrival will represent a service that is complementary to Disney+ and it will consolidate The Walt Disney Company’s presence in Latin America’s streaming market. With Star+, we will also reinforce our constant commitment of over 20 years to develop, produce, and offer local content that represents the taste of consumers of the whole region, producing original content with well-known local production companies and talents, to tell stories that connect with Latin American audiences. We will do so through different genres, addressing original fiction stories, and social and historic themes that are relevant and of general interest.”

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The service will be available on Internet-connected devices and users can subscribe separately or as part of a bundled offer with Disney+.

The service includes exclusive premieres of general entertainment TV series and movies from The Walt Disney Company’s content studios, including Disney Television Studios, FX, 20th Century Studios, STAR Original Productions, National Geographic Original Productions and more, and the streaming service for live sports from ESPN. From dramas to comedies (including all seasons of “The Simpsons”) and thrillers for adults, Star+ also features exclusive original programming from the Star general entertainment brand, along with a collection of regional original productions from Latin America.

Disney, NFL and ESPN Reach Long-Term Agreement

The Walt Disney Company, ESPN and the National Football League have reached a long-term agreement that will result in ABC/ESPN joining the Super Bowl rotation, having additional playoff action, exclusive national ESPN+ matchups over the course of the agreement, and more regular-season contests including “Monday Night Football.”

The deal will also result in enhanced game quality and new schedule flexibility, according to a Disney press release.

The 10-year agreement begins with the 2023 season.

“This landmark agreement guarantees that ESPN’s passionate fan base will continue to have access to the best the NFL has to offer,” Disney CEO Bob Chapek said in a statement. “Bringing all the considerable and unique capabilities of The Walt Disney Company and ESPN to the table opens up so many opportunities across our industry-leading direct-to-consumer, broadcast, cable, linear, social and digital outlets. Special thanks to Roger Goodell and the NFL owners for continuing to embrace new ways to appeal to their fans, especially through increasingly important platforms like ESPN+.”

“When ESPN and the NFL work best together, the results are transformational for sports fans and the industry,” Jimmy Pitaro, chairman, ESPN and sports content, said in a statement. “Some of the most remarkable collaborative examples have occurred in the past 12 months and have demonstrated the extraordinary range of The Walt Disney Company that is fundamental to this agreement. There are so many exciting new components, including Super Bowls and added playoff games, new end-of-season games with playoff implications, exclusive streaming games on ESPN+, scheduling flexibility and enhancements, and much more. It’s a wide-ranging agreement unlike any we’ve reached with the NFL, and we couldn’t be more energized about what the future holds.”

“We are thrilled to extend and expand our partnership with Disney far into the future, as ESPN will continue to host cable’s most-watched series, ‘Monday Night Football,’ and ABC is returning as a Super Bowl broadcaster,” said NFL Commissioner Roger Goodell. “We look forward to working with Disney as they use new platforms, including ESPN+, in innovative ways to reach even more NFL fans.”

ABC/ESPN will carry two Super Bowls (2026, 2030 seasons) as part of a rotation between the NFL’s media partners, marking the first time that an ESPN-NFL agreement includes such Super Bowl rights, according to the press release. ABC last televised the Super Bowl in February 2006 (2005 NFL season). Also, ESPN will present more playoff action, adding an annual divisional round game to its schedule, which will continue to include a wild-card matchup.

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ESPN’s increased regular-season package will include one annual exclusive national game on ESPN+. The game will take place internationally and will be aired live in the Sunday morning Eastern time zone window. Additionally, this agreement allows ESPN the opportunity to simulcast all ESPN/ABC game telecasts on ESPN+.

Also included is rights for the return of ESPN+ highlights show “NFL PrimeTime” each week on the streaming platform.

ESPN will increase its regular-season schedule by 35% — six more games per year (from 17 to 23). It will include an ESPN game on Monday nights (including three weeks with a separate game on ABC), a Saturday doubleheader the season’s final week and the Sunday morning game on ESPN+.

The added two Saturday games will take place during the final week of the regular season and will showcase matchups with playoff implications. Both of those games will be simulcast on ABC and ESPN.

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The agreement includes new elements that will enhance the caliber of the “Monday Night Football” slate, according to the press release. First, the schedule will be more flexible than in years past with the ability for the NFL to swap “a more meaningful” game into the “Monday Night Football” slot with 12 days’ notice from Week 12 on, according to the press release. Additionally, top teams will appear more often, as a result of the agreement which provides ESPN the ability to showcase any four teams at least twice, “leading to even more compelling games,” according to Disney.

With comprehensive NFL highlights rights, ESPN will continue to offer and/or develop NFL-branded programming, pre- and post-game shows, news, analysis and highlights studio shows, storytelling vehicles, digital and social content and more. The deal also includes data rights (e.g. – NFL’s Next Gen stats), according to Disney.

In addition, ESPN has once again secured rights to the annual Pro Bowl. Other key elements include opportunities for alternate telecasts, extending and expanding ESPN’s international rights (including areas in Latin America, the Caribbean, Africa, Oceania, India), ESPN Deportes and more.

ESPN has also obtained rights to NFL Drafts, an event that has been an ESPN fixture since 1980, as part of the agreement.

The 2021 season will be the last in ESPN’s current arrangement with the NFL. ESPN and the NFL have reached a bridge agreement for 2022 — the year between when the previous agreement expires and the new 10-year extension begins. For both the 2021 and 2022 seasons, all the foundational components from the agreement expiring in 2021 will be included (e.g. – weekly “Monday Night Football” games), in addition to select elements from the new 10-year agreement. For example, in 2021, ESPN will be adding the two Saturday games with playoff implications on the last weekend of the regular season. For the 2022 bridge year, ESPN will showcase the two Saturday games with playoff implications on the last weekend of the season, a Sunday morning ESPN+ game and one ABC “Monday Night Football” broadcast on a week there is also an ESPN Monday Night Football telecast.

First Anniversary of Disney+ Finds Service’s Parent Grappling With Pandemic Fallout

Disney’s high-profile subscription streaming service Disney+ launched a year ago today (Nov. 12). Disney is set to report fourth-quarter financial results at the market close. With much of its businesses such as amusement parks, cruise ships, movie studio and television operations (and ad revenue) either shuttered or operating in limited capacity due to the coronavirus pandemic, streaming video is likely the only positive on what is expected to be a depressed corporate earnings call.

Disney+ had more than 60 million subscribers on the company’s last fiscal call, and CEO Bob Chapek has made it clear over-the-top video is at the core of company  going forward. Indeed, when combining Hulu and ESPN+, Disney’s SVOD subscriber base topped 100 million at the end of the previous quarter.

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The summer rollout of Disney+ Hotstar in India, which is operated by Disney subsidiary Star India, features two paid tiers: a VIP plan offering local language programs and live sports; and a Premium plan showcasing international (i.e. U.S.) movies and TV series from Disney, Showtime and HBO, among others. The service had nearly nearly 9 million subscribers in the last quarter.

“Disney+ has been the one shining star in the Disney empire in 2020,” Trip Miller, a managing partner at Gullane Capital Partners, told CNN Business. “The advent of the Disney+ platform could not have come at a better time.”

Yet, the SVOD platform is not projected to be profitable until 2024. The service could end up losing $2 billion in the just-concluded fiscal year — and even more in 2021.

“I think Disney+, and the rest of their direct-to-consumer assets like Hulu and ESPN+, are the most important units in the eyes of investors,” said analyst Michael Nathanson. “It’s a source of long-term growth and helps offset [pay-TV] cord-cutting and shifts in audience behavior.”

Nathanson, who believes ad-supported VOD is the streaming story in 2020, says Disney’s OTT platforms have the ability to expand with AVOD offerings depending on marketing conditions. Disney plans to launch an ad-supported international OTT service under the Star brand in 2021.

Indeed, growth of free ad-supported streaming TV (“FAST”) is exploding through services such as ViacomCBS’s Pluto TV, Comcast’s Xumo (and Peacock), Fox Corp.’s Tubi, The Roku Channel and IMDb TV, among others. And Disney doesn’t want to be left behind.

“They are really all in [streaming] now,” Nathanson said. “Disney has built a [OTT] lifeboat that gets them through the current storm in traditional media.”

Disney to Furlough Non-Essential Employees Beginning April 19

In the wake of the coronavirus pandemic, The Walt Disney Co. will start furloughing non-essential U.S. employees April 19, the company announced.

Disney committed to full pay and benefits for all employees through April 18.

“With no clear indication of when we can restart our businesses, we’re forced to make the difficult decision to take the next step and furlough employees whose jobs aren’t necessary at this time,” a Disney representative said in a statement.

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Furloughed workers will remain Disney employees through the furlough period and will receive full healthcare benefits with Disney will paying the cost of premiums.

Disney did not report the number of employees that would be affected.

Bob Chapek Named Disney CEO

Former home entertainment executive Bob Chapek has been named CEO of The Walt Disney Company.

Chapek most recently served as chairman of Disney Parks, Experiences and Products.

Former CEO Robert A. Iger assumes the role of executive chairman and will direct the company’s creative endeavors, while leading the board “and providing the full benefit of his experience, leadership and guidance to ensure a smooth and successful transition through the end of his contract on Dec. 31, 2021,” according to a Disney press release.

(L-R): Bob Iger and Bob Chapek at the opening of Star Wars: Galaxy’s Edge at Disneyland. (Photo by Business Wire)

In Chapek’s new role as CEO, he will directly oversee all the company’s business segments and corporate functions and will report to executive chairman Iger and the board of directors. He will be appointed to the board at a later date. A new head of Disney Parks, Experiences and Products will be named at a future time.

“With the successful launch of Disney’s direct-to-consumer businesses and the integration of 21st Century Fox well underway, I believe this is the optimal time to transition to a new CEO,” Iger said in a statement. “I have the utmost confidence in Bob and look forward to working closely with him over the next 22 months as he assumes this new role and delves deeper into Disney’s multifaceted global businesses and operations, while I continue to focus on the company’s creative endeavors.”

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“I am incredibly honored and humbled to assume the role of CEO of what I truly believe is the greatest company in the world, and to lead our exceptionally talented and dedicated cast members and employees,” Chapek said in a statement. “Bob Iger has built Disney into the most admired and successful media and entertainment company, and I have been lucky to enjoy a front-row seat as a member of his leadership team. I share his commitment to creative excellence, technological innovation and international expansion, and I will continue to embrace these same strategic pillars going forward. Everything we have achieved thus far serves as a solid foundation for further creative storytelling, bold innovation and thoughtful risk-taking.”

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Chapek served as Chairman of Disney Parks, Experiences and Products since the segment’s creation in 2018, and prior to that was chairman of Walt Disney Parks and Resorts since 2015.

Bob Chapek (right) with fellow home entertainment division presidents Mike Dunn (20th Century Fox), David Bishop (Sony Pictures) and Steve Beeks (Lionsgate) at the 2007 CES, showcasing Blu-ray Disc.

From 2011 to 2015, Chapek was President of the former Disney Consumer Products segment. Prior to that, he served as president of distribution for The Walt Disney Studios and was responsible for overseeing the studios’ overall content distribution strategy across multiple platforms including theatrical exhibition, home entertainment, pay TV, digital entertainment and new media.

He also served as president of Walt Disney Studios Home Entertainment, where he spearheaded the successful “vault strategy” for the company’s iconic animated classics. They would be released on home video for a limited time before being returned to the “vault,” a practice that led to spikes in demand — and a series of home video sales records.

Chapek also played a key role in transitioning home entertainment from DVD to Blu-ray Disc, characterizing the latter as an “evolutionary” format — a prediction that has come true, as Blu-ray Disc is now the conduit for the latest technological advance in home viewing, 4K Ultra HD.

Speaking on an investor call shortly after the transition announcement, Iger said that even though he has nearly two years left on his contract, the change was being made now because he felt he needed to start focusing on the company’s creative strategy in the wake of the acquisition of the 20th Century Fox studio assets and the launch of the Disney+ streaming service.

“With the asset base in place and with our strategy essentially deployed, I decided I should be spending as much time as possible on the creative side of our business,” Iger said. “That becomes the biggest priority. Getting everything right creatively would be my number one goal. The best way to do that was to turn over day to day management of the company to Bob [Chapek] and free me up to focus on the creative side.”

 

Kelly Campbell Promoted to President of Hulu

Hulu chief marketing officer Kelly Campbell is being promoted to president of Disney-owned SVOD service Hulu.

In this role, Campbell will manage Hulu’s suite of on demand and live streaming businesses. She will work closely with Disney’s television and film studios on Hulu’s original content, and with other Direct-to-Consumer and International leaders on the integration of key aspects of Hulu’s operations across the segment, according to a Disney press release.

Her promotion follows the departure of Hulu CEO Randy Freer earlier this month.

“Kelly is an immensely talented leader who has been a driving force in defining Hulu’s brand vision and strategy,” said chairman of Disney’s DTCI segment Kevin Mayer, to whom Campbell will report, in a statement. “She has built a tremendous multi-talented team and developed strategic campaigns that helped double Hulu’s subscriber base. Our senior leadership team is excited to welcome her aboard and can’t wait to work together to further grow Hulu’s footprint in the US and beyond.”

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“This is a time of extraordinary growth and transformation for Hulu, and I am incredibly energized by the opportunity ahead as we enter into this next chapter,” said Campbell in a statement. “The Hulu team is among the brightest, most technologically and creatively audacious in the industry, and I know we are going to do great things as part of the pioneering and equally bold team Kevin has built at DTCI.”

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As Hulu’s chief marketing officer, Campbell was responsible for subscriber growth; brand, content and business-to-business marketing; creative development; research and insights; and viewer experience. Prior to joining Hulu, she spent 12 years at Google in various leadership and marketing roles across the Google Ads and Google Cloud businesses, including a year in Google Japan building the online sales and operations functions. She began her career in finance as an investment banking analyst at JPMorgan Chase.