The Walt Disney Company, which reported a US$4.7 billion loss in the June third quarter, is to sell its movie Mulan online for US$29.99.
The decision comes as the big Hollywood studios have repeatedly postponed their films as the coronavirus pandemic continues globally. The US, the world’s biggest movie market, has less than 17% of its 5,440 cinemas open. Regal Cinemas, the nation’s second largest cinema chain, has announced that it will begin to reopen its US locations on August 21, Variety reported.
The Walt Disney Company, which reported a US$3.5 billion loss to operating income at its theme parks as the coronavirus pandemic shut them down, will make Mulan available to buy on Disney+ on September 4 in the US, Canada and western Europe.
“We’re looking at ‘Mulan’ as a one-off, as opposed to saying there’s some new business windowing model that we’re looking at,” said CEO Bob Chapek, who succeeded Bob Iger in February.
“We find it very interesting to take a premiere offering to consumers at that $29.99 price and learn from it.”
He also said that the premiere access window created on Disney+ for Mulan acts as a “fairly large stimulus” for new subscribers to the streaming service.
The media and entertainment multi-national’s total revenue in the June quarter dropped 42% year-over-year to $11.8 billion, while adjusted earnings plunged 94% year-over-year to 8 cents a share. The theme parks unit posted a $2 billion operating loss, while revenues dropped 85% year-over-year to US$983 million in the quarter.
The one positive for the company is its streaming service Disney+ which has benefited from coronavirus-pandemic induced lockdowns. Disney+ has 60.5 million subscribers, only nine months after launching.
“Despite the ongoing challenges of the pandemic, we’ve continued to build on the incredible success of Disney+,” said Chapek. The streaming service is still running at a loss, with the direct-to-consumer business unit posting an operating deficit of US$706 million in the quarter on US$4 billion in revenues.
Disney+, Hulu and ESPN Plus combined have more than 100 million global subscribers. In the second quarter, the company reported 54.5 million worldwide subscriptions.
The company, which employs 223,000 people, intends to launch an international direct-to-consumer general entertainment offering under the Star brand in the 2021 calendar year. Chapek said it would draw content from Disney-owned ABC Studios, FX, Freeform, 20th Century Studios and Searchlight.
The direct-to-consumer offering is a “top priority and key to the future of the company,” said Chapek.