Disney Deathwatch: November 2022
It’s been a while since I’ve done one of these. Many things are going on with Disney and almost all of them are bad.
We will start with the biggest news. Black Panther Wakanda Forever had a big opening weekend of $192 million domestic.
Here’s the problem. There are a lot of reports that once again the box office has been Fortified. If true, then this is another example of Disney’s weird little practice of buying up large numbers of seats on the opening weekend to boost the reported box office take. Since studio’s get 90% of that during the first week of release, it costs Disney less than you would think. Although the theater owners hate it because they are very dependent on those popcorn sales to make up the difference and Disney ain’t buying that.
Muddying these waters, even more, is the phenomenon of various activist groups deciding that this or that representational Disney movie needs to be supported. They too will buy up large numbers of tickets. This leaves the question of how many people actually saw it up in the air. One thing that isn’t up in the air are Monday’s numbers, it crashed 73%. The Fortified box office also explains why Marvel movies have lately been falling off a cliff on the second weekend. While this film will obviously do well and will make a profit, it seems likely to me that it will leg out well short of a billion dollars worldwide. Particularly when you look at the fact that the first Black Panther was comparatively weak in foreign markets.
This MAY have sparked a big change behind the scenes at Disney/Marvel. There are suddenly rumors going around today that Kevin Fiege is planning to leave Disney when his contract expires. I would dismiss these rumors as BS but there seem to be a lot of different sources reporting it. However, neither Puck nor Mikey Sutton are among those guys, so on a scale of 1 to 10, my confidence is 4. It would be lower if it wasn’t for the fact that Fiege and Chapek do not get along.
Speaking of Chapek, there have been a lot of calls for his dismissal from the various quarters because of Disney’s last quarterly earnings. In truth, these calls are due to the fact that he isn’t pursuing Bob Iger’s hobbies and bad numbers are just the latest excuse.
Regardless, the board and the institutional investors knew the next three quarters would all be bad. That was baked in because of Disney +’s lack of content, which was why they renewed Chapek’s contract early. It was less controversial to do that then, instead of waiting for February 2023. I think I said that somewhere.
Anyway, Chapek isn’t going anywhere just yet. Not unless the Parks collapse, which brings us to our next segment.
The parks are in trouble, but Disney-trained executives are fundamentally incapable of accepting this.
I have made no secret of the fact that I loved Disney parks at one time in my life. That time sure as fuck isn’t now! And I am pretty far from being alone there.
The best explanation of I’ve heard is from Poseidon Entertainment which compared consumer confidence to an ocean’s thermocline. Any large body of water has the same thermal effect. The water is warm on the surface, then starts to get cooler as you descend, but then you hit the thermocline and the water’s temperature suddenly drops like a hammer.
It’s a good analogy for consumer confidence. Loyal Disney Park customers will continue to buy their product based on past experience rather than current performance. Revenue will only dip slightly during this period, however, all the nickel and dime cuts to the park as well as the 1000% price hikes on everything more than made up for it.
So, Chapek is happy to do even more of it. Lower production values, smaller food portions, less entertainment, and the customers keep coming. I guess this was why Chapek was happy to go on at length about “how incredibly strong our brand is.” Translation: The Pixie-duster pay-pigs will clearly put up with anything, so let’s do more of it.
The problem is this: Due to reasons of sentiment, or optimism, or even just inertia customers will continue to buy the product even after the consumer confidence has been completely broken. The Pixie-duster boards are reading like break-up letters. The overwhelming sentiment is ‘for old times’ sake we will go this one last time but that’s it.’
Then you hit the thermocline of consumer confidence where the consumer confidence suddenly vanishes all at once, and the customers stop coming back no matter what you do.
Take a look at Andor. It is easily the very best Disney Star Wars TV series, but consumer confidence hit the thermocline with the Book of Boba Fett. Star Wars fans already knew the franchise was broken by the time it was streamed but they gave it one last shot. Now that there is a decent show out there no one will even consider looking at it.
Disney Parks are going to hit the Consumer Confidence Thermocline in the next 18 months.
There will be a stunned silence from Fort Mickey, then a frantic dropping of prices and special discounts but it’s not going to matter. Their reputation will be lost to depths by then.