Rich Greenfield's "Core Problem" With Disney

February 7, 2018

Disney’s attempts to launch its own streaming service may be “doomed to failure.”

That’s according to BTIG analyst Rich Greenfield, who says the media giant can’t compete with the likes of Netflix, because it refuses to go “all-in” on streaming.

“They’re trying to do this balancing act where they continue to profit from the legacy business model with ESPN and then try to create a streaming service as an incremental add-on,” he told Cheddar in an interview Wednesday after the company reported earnings. “They’re not putting the entire company into one full effort to make streaming successful. They’re trying to balance multiple profit centers as well as trying to start a new business.”

Disney reported earnings after the bell Tuesday, revealing some details about the streaming services it announced last year. A new series of “Star Wars” films will be released exclusively on its entertainment-focused product, which will launch next year. And ESPN Plus will debut this spring at a cost of $4.99 a month.

And while the company hopes this service will help revive its struggling sports business, Greenfield says ESPN Plus only serves a niche market.

“This is going to be for a superfan who wants an extra college football game or some extra NHL games...extra tertiary content that wasn’t good enough to air on TV,” he said. “This is not taking ESPN and putting it over the top, which is obviously what sports fans want. What consumers are begging for is to not take the big bundle.”

For full interview, click here.