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Published by:
IBS Center for Management Research (2019)
Length:
17 pages
Data source:
Published sources

Abstract

This award-winning case is about The Walt Disney Company's (Disney) attempts to disrupt the streaming space as it ended its exclusive licensing deal with streaming industry leader Netflix in favor of starting its own direct-to-consumer (DTC) streaming services. The first streaming service, focused on sports (ESPN ), was launched in April 2018 and the second, a Disney-branded film and TV streaming offering, was slated to debut in 2019. In order to accelerate its push into the DTC space, Disney acquired media giant 21st Century Fox (Fox) in December 2017 in an all-stock deal of USD71.3 billion. The deal, expected to close by early 2019, would give Disney control of Fox's film and television assets as well as stakes in video-streaming service Hulu and overseas television-service providers, Sky plc and Star India. Disney planned to use content from Fox to combat disruption in the rapidly changing streaming space, where the competition included strong players such as Netflix and Amazon. As Disney tried to break into the global streaming market, Robert A Iger (Iger), Chairman and CEO of Disney, faced a number of challenges. He had the daunting task of building a massive streaming platform while integrating two big content-creation rivals (Disney and Fox) which had drastically different images and corporate cultures. Moreover, as Disney planned to shift its business model by cutting out middlemen and selling its content directly to customers, Iger had to prepare his company to embrace the new business model without diluting its existing model. Can Disney's streaming platform battle digital disruption and aggressively undercut the disruptor Netflix? How will the Disney Fox merger affect the media and entertainment landscape? Will Disney be able to disrupt the OTT (Over-The-Top) market or is it too late for it to catch up?

Teaching and learning

This item is suitable for undergraduate and postgraduate courses.

Topics

Digital disruption; Digital business strategy; Direct-to-Consumer (DTC) streaming; Platform; Competitive advantage; New market disruption; Strategic alliances; Direct-to-consumer; OTT market; Mergers & acquisition; Integration; BCG matrix; Market challenger strategy; Competitive strategy; Strategy clock

Setting

The events covered by this item took place in 2017-2018.

Geographical setting

Region:
Americas
Country:
United States

Featured company

Company name:
The Walt Disney Company
Employees:
10000+
Turnover:
USD 59.43 billion
Type:
Public company
Industry:
Media & entertainment

Featured protagonist

  • Robert A Iger (male), Chairman and CEO

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