Coronavirus May Force Disney to Reevaluate Streaming Strategy

By Brent Lang

LOS ANGELES (Variety.com) – Movie theaters may be closed due the coronavirus pandemic, but The Walt Disney Company says it still believes that cinemas are a critical component in the rollout of its big blockbusters.

However, Walt Disney Company CEO Bob Chapek did acknowledge that the disruptions caused by the public health crisis may require the company to send more movies to its streaming service Disney Plus or to have them debut on premium video-on-demand (PVOD).

“We very much believe in the value of the theatrical experience overall for large blockbuster movies,” Chapek told analysts and investors on Tuesday. “We also realize that either because of changing and evolving consumer dynamics or because of certain situations like COVID, we may have to make some changes to that overall strategy just because theaters aren’t open or aren’t open to the extent that anyone needs to be financially viable.”

The Disney chief’s comments come as other competitors such as Universal have more fully embraced PVOD, debuting films such as “Trolls World Tour” and the upcoming “King of Staten Island” that were once intended to bow in theaters, in the home. With cinemas closed, Disney has re-scheduled most of its major upcoming releases, such as “Mulan” and “Black Widow.” There was one exception: “Artemis Fowl,” an adaptation of a popular tween book series, will instead debut on Disney Plus. Chapek said that was due to the film’s “demographic appeal.”

“We’re going to evaluate each one of our movies on a case-by-case situation,” he said.

The Disney chief also addressed the production shutdown for the company’s films and television shows. He noted that he wasn’t certain when it would be safe for people to return to sets, but predicted that when they do, there will be new safety regulations.

“We’ve got no projections of exactly when we can do that, but we will be very responsible in terms of masks and the same type of procedures that we would hope to implement into our parks,” Chapek said.

Disney announced that it will reopen its resort in Shanghai on May 11, but there will be changes to the customer experience. In addition to reducing the number of guests in the park, there will be temperature checks and customers will be required to wear masks.