Disney in the doldrums: What’s gone wrong at the Mouse House?

It seems a little on the shiny black nose that the Walt Disney Company picked this of all years for its annus horribilis. It was on October 16th, 1923, that Walt and Roy founded what was originally called Disney Brothers Studio, so the current entertainment conglomerate has spent 2023 in a fizz of celebration and self-congratulation, carpet-bombing the planet with Disney 100 merch. There’s just one problem: Disney productions have been failing all year at the box office while the streaming service it thought would be a gold mine remains a millstone.

What happened? It seems only yesterday (it was actually five years ago) that what the trade papers call the Mouse House was on the verge of eating the entire American entertainment industry, having gobbled up 20th Century Fox, scarfed down the ABC, ESPN and National Geographic TV networks, annexed Pixar, Marvel and Lucasfilm, extended its tentacles deep into the adjacent worlds of publishing and music and landed its tanks on the beaches of the streaming market with Disney+ and Hulu. That was all on top of its already humongous own-brand film and TV studios, distribution companies, cinema chains and, of course, the world’s best known theme parks.

In an era when all the talk in the media industry was of consolidation, Disney had succeeded in becoming the 100-ton gorilla in the room, with a market capitalisation of $150 billion. All was set fair for global domination. Or so it seemed.

As we close out 2023, Disney is struggling with a still-unprofitable streaming business, a falling stock price, and declining revenue at Walt Disney World, in Florida – where it is locked in a bitter culture war with the state’s governor, Ron DeSantis – along with a dismal run of box-office misfires, from Indiana Jones and the Dial of Destiny to Ant-Man and the Wasp: Quantumania. The Marvel franchise looks fatigued – the recent The Marvels was a commercial disaster – while family-friendly animations such as Wish are underperforming.

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If you are queasy about the prospect of a giant, mouse-shaped behemoth crushing the world’s entertainment industry beneath its enormous hobnailed boots, then it’s hard to suppress a smile, although there’s nothing funny about the 7,000 job losses the company announced earlier this year.

Disney is doing its best to make light of its travails. Its chief executive, Bob Iger, has pointed to strong growth in the Asian theme-park market, along with the continued health of the ESPN sports network in the US. And there are high hopes for some 2024 releases, such as Pixar’s Inside Out 2.

Some American conservatives have suggested that audiences have reacted badly to Disney’s supposed newfound “wokeness”, but there’s no real evidence of that. Others have proposed that the power of the Disney brand is actually contributing to the damage. The arrival of Disney+ as a major player in streaming coincided with the pandemic, and the company made what appeared a sensible strategic decision to release some big titles online first. But now audiences are staying away from Disney cinema releases because they know they’ll be getting them via their Disney+ subscriptions within a couple of months. Disney, it is suggested, suffers more from this consumer behaviour than others because everyone recognises its products and connects them with Disney+ in a way that doesn’t happen between, say, a release from Universal and its Peacock streaming platform.

There may be some truth in that, but one can’t help wondering whether we are also seeing the theory of business consolidation crashing into the reality of creative entropy. In the course of the relentless expansion of recent years, Disney amassed a hoard of intellectual property: from Buzz Lightyear to Thor and from Darth Vader to Dumbo, it found itself sitting on an enormous pile of precooked products just waiting to be reheated. The most egregious example has been the endless stream of superfluous CGI remakes of animation classics from the vaults, the most recent example being this year’s The Little Mermaid and the next being what already looks like a horrible reworking of Snow White.

The same law of diminishing returns also seems to have kicked in for the extended Marvel universe in all its theatrical and episodic TV manifestations. Star Wars, meanwhile, has become a TV-only franchise. Pixar is holding up a little better, although its true golden era – one of the greatest runs in movie history, to be fair – looks to be in the rear-view mirror.

You could see Disney’s difficulties simply as a series of unconnected unfortunate events: the fight with DeSantis; the deflation of the streaming bubble; the ongoing decline of linear TV; the long winning streaks of Marvel and Pixar finally coming to an end. And the company is certainly too big to fail. But it’s still a cautionary tale for those who thought the future of entertainment lay in gigantism.