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As Cord Cutting Grows Disney Starts Laying Off More Staff


For years now cord cutting has slowly chipped away at the subscriber numbers for traditional pay-TV outlets. This seems to finally be having an effect as earlier ESPN cut some staff. Now we are learning that Disney plans to cut as many as 200 more staff this year.

The layoffs will impact all of the division’s teams: ABC Entertainment, ABC Studios, Disney Channel, Disney XD, Disney Junior and Freeform.

Disney overall has seen their shares go down by 7% year to date as the Dow Jones Industrial Average is up nearly 16% of the same time and the S&P 500 is up 14%. Many are pointing to growing concerns over cord cutting as the reason why Disney is struggling right now.

To fight back Disney has announced plans to launch an ESPN streaming service in 2018. They also will launch a movie streaming service in 2019 with Marvel, Star Wars, and Disney movies.

Earlier this month Disneys Chairman and CEO Roger Iger opened up about their future plans for Disney and streaming.

“At some point, we felt it would be necessary for us to not only be disrupted, but to disrupt our business ourselves,” Iger said. “We felt that we were no longer seeing a speed bump of disruption … What we were seeing instead was real, profound and permanent change.”

For now though it looks like Disney plans to use cuts to help them stay ahead of the disruption as they plan their own disruptive services.

Source: MarketWatch

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  • TV Barrington

    I know that I don’t know the deeper workings for this company, but me it seems someone at Disney keeps calling the wrong shots towards growth. I thought I read somewhere that ESPN (or some sports related division) is basically dead weight, and that someone at Disney keeps trying to bail out that division by making the other parts of the Disney empire suffer.

    I can see the possible benefit of an ESPN streaming service for the folks that love sports, and it might work depending on what the service might offer, and the monthly cost. However, I currently can’t see a movie streaming service working, especially since there are so many other services offering movies. I guess it’s possibly the streaming service is free, but Disney related movies might cost you to see them, and they might only be exclusive to that channel. Even though I currently can’t see a need for them, it might be interesting to see how they launch these two services, as well as what is offered and what the cost will be.

    In this world of streaming and cordcutting, there are only so many consumer dollars out there, and with streaming, it’s sort of like the wild west. Only the best service with the best features and best quality channels, along with the lowest cost, will win out. Disney seems to be moving in a desperate direction, and they may regret not cutting off the deadwood that may be hurting them, and selling more rights to other streaming services…. Just thinking out loud.

    • Rick Barnett

      I think you are right on with this. We are in a transition between an old, traditional model and streaming .It does appear that everyone is trying to get a piece of the pie and the big broadcasters somehow think that the masses are going to be willing to pay for several different subscription services in order to watch content owned by each company. The masses do not care about who owns which series or movie. They pay large amounts of money to a cable company who has worked all of that out. The end user sees a channel line-up that is easily accessible to them, but they are very discontent with what they are paying. The major streaming players are offering a cable model because that is what people are accustomed to.

      I suppose that a true a la carte model would mean that each company offers their content (channel) to you at a fair market value and you pay for it if you want it. Maybe Disney is hedging their bets on this. One thing that I do know about ESPN is that it is a dead weight because it is the most expensive channel that exists. Rights to NFL is an astronomical figure.Viewership continues to drop year over year, yet the sporting organizations are asking for more. It will fail.

      • TV Barrington

        I agree, and thank you. 🙂

        You mentioned, “It does appear that everyone is trying to get a piece of the pie and the big broadcasters somehow think that the masses are going to be willing to pay for several different subscription services in order to watch content owned by each company.” Before I recently cut the cord, I subscribed to CBS All Access and Hulu. I subscribed to them because my DVR would either fail from time to time, or severe weather would affect the Comcast signal for some reason (probably satellite). It would allow me to catch shows that I missed.

        With cutting the cord, I have SlingTV, CBS All Access, and the basic Hulu. The only reason that I continue to have CBS is because they currently have the new StarTrek (Yes, I’m a geek LOL), but as soon as the season is over,I have no reason to continue it. My new Tivo Roamio, Sling, and Hulu will provide me pretty much anything that I want. I’ll decide later about Hulu.

        Anyway, I took the long way around towards saying that I cut the cord to save money from cable, and I will continue to monitor what is important to me and what my monthly entertainment bill will be too. I know that it will fluctuate as time goes on, but it will be much cheaper than Comcast.

        A streaming service will have to be extremely special for me to part with my money. After all, I’m trying to work my way down with monthly cost. I’m not a sports fanatic (nothing against people who are) so there is no need for ESPN, and my kids are grown an gone, so there is no need for a Disney related service. If a Marvel movie is no longer available to rent on a free visit site like Google Play, or another service, I’ll just start renting DVD’s from Redbox. I’m not going to have a bunch different pay to have streaming services that will inch my buget back up to where I was with Comcast. I can do without certain channels or shows. It’s the wild west out there for the moment, and depending on a person’s viewpoint, the cord-cutting consumer could be winning or losing. At the moment, I personally feel that I’m winning, and I hope it will be for many years.

        Much like search engines and other sites, we saw winners and losers, and many of the winners bought up the losers. We could see that happen over the next 5 to 10 years, and streaming services will be our new cable companies…. Just speculating in general on everything. LOL

  • CT

    Cord cutting isn’t the reason why there were layoffs at Disney/ABC.

    • Rick Barnett

      I should edit my reply to TV Barrington to say that he/she is right on with the ESPN comment. I’m not sure that cord cutting has become disruptive enough to cause lay offs.

    • MTV_Fan

      In before Jake Paul.

  • Jason

    This is slightly overblown people. Disney is a gargantuan company. ABC division alone employs 7000+ ppl.

  • Sunflower

    Disney wouldn’t have to down-size if they’d just release some of the old Halloween specials on dvd or blu-ray and bring back the old Wonderful World of Disney to Sunday nights.