DISNEY China, convergence and franchising exemplified

UPDATE...

China had 4 of 2019's top 20 WORLDWIDE films. In September 2020 it was easily the world's biggest cinema market with the US covid-hit. Read an excellent analysis here.

As of the end of 2019, China now has 69,787 cinema screens, up 9,708 from 2018, according to the Communist party mouthpiece the People’s Daily, which added that more than 1.7 billion tickets were sold. The propagandistic publication went so far as to deem the current moment a “golden age” for the Chinese film industry’s development, as “the market bubble fades… and Chinese films continue to steadily improve.” (Variety: China’s Box Office Hit New Heights in 2019, as Hollywood’s Share Shrank. Good detail on how the Chinese market is shifting towards homegrown hits)

FURTHER UPDATES: Barr condemns Disney and Hollywood for 'kowtowing' to China.

Mulan shows how far Disney will go, self-censor, to maximise the Chinese market (Guardian).

Disney is so damned big it even owns one of its main TV subscription rivals, Hulu. The mighty mouse movie company now gets 50% of its revenues from its multiple theme parks, but is also as much a TV company as it is a film company - from its subsidiaries like ESPN (sports channel) to zeitgeisty series making baby Yoda a global phenomenon, there's more to Disney than movies.

It's buying spree was seen as crazy by some - but bear in mind that Marvel cost them $4bn ... and the last Avengers movie alone raked in $3bn from the box office, never mind its value in driving $5.99/month subscribers to Disney+.

It's even managed to get back into China, having been banned for years because of pro-Tibet movies it now has a Shanghai Disneyland (but it's 57% owned by the Chinese government!) and since 2016 it has been getting movies distributed there again. Their Mulan remake has changed a lot of aspects to avoid upsetting the Chinese government!

This article ends on an intriguing notion - because their stock market value has dropped by over $80bn since the coronavirus hit (a third of their value) ... could Apple sweep in to buy this giant???

Taking the Mickey: how Disney swallowed up all of culture.

Statista.com breakdown of China's surging global share

NETFLIX worlds biggest media company as APPLE launches rival

2018 update: Netflix puts content above costs but is the policy sustainable?

https://www.theguardian.com/media/2018/may/25/netflix-puts-content-above-costs-but-is-policy-sustainable?CMP=Share_AndroidApp_Copy_to_clipboard

I've written a few times that Apple's entry into the subscription TV streaming market is inevitable ... and here it comes, with an annual $1bn budget for 10+ new series and some incredibly high profile industry names signed up
Apple has Netflix and Amazon in sight as it hires British TV executive

https://www.theguardian.com/technology/2017/oct/25/apple-has-netflix-and-amazon-in-sight-as-it-hires-uks-top-tv-executive?CMP=Share_AndroidApp_Copy_to_clipboard

More niche than Netflix: nine specialist streaming services you should try https://www.theguardian.com/tv-and-radio/shortcuts/2017/oct/23/more-niche-than-netflix-nine-specialist-streaming-services-you-should-try?CMP=Share_AndroidApp_Blogger

STREAMING Disney quit Netflix for own service. Fragmentation?

Disney now offering streaming TV.

Apple will have to join this suddenly crowded market, with Netflix, Hulu, Amazon and more facing increasing competition.

If more of the big six follow suit, surely that will actually undermine the paid-for streaming industry and encourage a resurgence in piracy?

Not in Lux. yet, but a fullscale streaming option is being rolled out.

UPSTREAMING RIP DVD Netflix Amazon dominate UK TV by 2020

The outlook for cinemas is uncertain as home cinema continues to grow in the quality offer, all-you-can-eat ticket offers on the rise, the likes of NBC-Universal's Prima service offering home screening of cinema releases, and the falling appetite for 3D - the extortionate ticket prices of which have been boosting cinema revenues for years, a golden goose that is now shedding its feathers...

The music industry has had to accept the sharp decline of physical sales, but the film industry hasn't yet reached that point of acceptance - but DVD and Blu-Ray alike are heading for the same cliff-edge of sales that CDs reached some years ago, another huge revenue stream under threat.

The big six also need to consider the digital upstarts Amazon and Netflix (and surely Apple sooner or later, the music industry slayer!) as key rivals ... and partners, an uneasy relationship.

A UK study has concluded that in just 3 years (by 2020) UK pay-TV revenue will be below that of streaming sites - but cinema might be more resilient (given my points above I'm highly sceptical!)

Paying for TV content from on-demand digital video services will grow by more than 30% to £1.42bn at the turn of the decade, claims consultancy firm PwC. This rise in popularity will see revenue from video services edge ahead of an estimated £1.41bn from cinemagoers. 

While Apple and Sky have also made inroads with their download services, the rise of streaming has been the biggest competitive challenge to cinemas in recent years. 

“Demand for internet video shows no signs of slowing down,” said Phil Stokes, UK head of entertainment and media at PwC. However, he warned against forecasting the death of blockbusters or the big screens where they are shown. “The figures do not signal the death of film. Look at the box office performance of films such as Star Wars: Rogue One or Fantastic Beasts and Where to Find Them to see the significant amount of enthusiasm for blockbuster movies out there.” 

Stokes said the UK film industry will remain in a “pretty healthy” position despite the boom in home entertainment. 

The report predicts movie attendance will grow from 172m admissions last year to 179m in 2021, and the number of screens across the UK will rise from 4,143 to 4,542. 

PwC predicts a “terminal decline” for DVD and Blu-ray sales from £1.22bn in 2016 to just £533m by 2021. The report predicts that internet video will overtake DVD sales this year, but some analysts claim this has already happened. 

Netflix and Amazon 'will overtake UK cinema box office spending by 2020'.

Streaming has already surpassed physical sales of film:

Total revenues from digital video – which includes services such as Apple’s iTunes as well as Sky’s store and Now TV – surged almost 23% to £1.3bn last year.The digital boost came as high street sales of DVDs and Blu-ray discs fell 17% to £894m – the first time it has fallen below the £1bn mark. The once mighty physical rental market fell 21% to just £49m.

(2017 Guardian article)

Netflix and Amazon rival big six?

I'll return to this to gather points made across many posts on this theme:
The traditional big six (7 if you count Lionsgate) vertically integrated US conglomerates that dominate global cinema have cause to be seriously worried about Netflix and Amazon (with Apple, HBO and many more bubbling away in the wings too).

The online giants are at once customer/distributor for the big six, including VoD and rental alongside DVD and Blu-Ray sales, and rival, with their film production budget growing, and the release strategies they follow undermining the concept of the release window.
Netflix’s Reed Hastings: ‘We’ve got a long way to go to get to ubiquity’.

CHINA bans Apple, Disney movie channels

While growth in the US is slowing, its international expansion is doing well, and though it may not have many subscribers in Syria or North Korea, it claims to be in all but one market globally. But that market is the world’s largest, China, where it has faced the same political barriers as other western media and technology companies.

“The Chinese government just closed down the Disney movie service. And they closed down Apple’s movie service. Those are two pretty sophisticated, relative to China, companies. It looks like the government just doesn’t want the foreign content distribution. Maybe someday in the future there’ll be an opportunity for us in China, it’s possible. We are continuing to work on it.”

Netflix’s Reed Hastings: ‘We’ve got a long way to go to get to ubiquity’.