BURBANK, Calif. — The Walt Disney Co. says it is making a bigger investment into its streaming services.

As part of a greater effort to capitalize on the growing popularity of its streaming services and create more original content for it, Disney on Monday said that it had reorganized its creative divisions with the focus on accelerating its direct-to-consumer business.

“We are strategically positioning our company to more effectively support our growth strategy and increase shareholder value,” Disney CEO Bob Chapek said in a statement. “Managing content creation distinct from distribution will allow us to be more effective and nimble in making the content consumers want most, delivered in the way they prefer to consume it.”


What You Need To Know

  • Disney has made organizational changes to focus on accelerating its direct-to-consumer service

  • The shelter in place orders and work from home due to the coronavirus have increased the popularity of on-demand streaming services

  • In less than a year, Disney+ has already amassed 61 million subscribers

  • Disney will focus on creating new content for its streaming services

The announcement comes as the demand and consumption for streaming services such as Netflix, Amazon Prime, and Hulu are growing during the coronavirus pandemic.

With more consumers stuck at home, many are logging on and watching either from their smart TVs, tablets, computers, or mobile phones. Disney is making a strategic move now to capitalize on the growing streaming market.

“COVID-19 has catapulted streaming to become the present and future of content creation,” Nielsen Senior Vice President of Audience Insights Peter Katsingris said in a report released in August. “Today, it accounts for 25 percent of our collective time spent with the television among streaming capable homes.”

The Nielsen report said the shelter in place and work from home orders to prevent the spread of the coronavirus, which shut down many states in March, contributed to the increase in streaming subscription and consumption.

In the past three months ending in August, the Nielsen Remote Worker Consumer survey found that 25 percent of participants have added a streaming service in the past three months.

Data from Nielsen Streaming Meter shows that of 1,000 households it analyzed, Netflix had the largest streaming share at 34 percent, followed by YouTube at 20 percent. Disney+ accounted for 4 percent of total streaming time, the report found. Hulu, which Disney also majority owns, had an 11 percent share of the market.

Last year, Disney acquired Hulu in May and released its signature Disney+ subscription service in November. In less than a year, Disney+, which houses Disney's classic animation, Pixar, Star Wars, and Marvel movies, has grown to nearly 61 million subscribers

Under the company's new structure, former Consumer Products, Games and Publishing President Kareem Daniel will lead a new division called the media and entertainment distribution group. It will be responsible for the distribution of content such as movies and television shows in the company's various platforms and house the company’s streaming services that includes Disney+, Hulu, ESPN+, and a soon to be launched international streaming service called Star. Rebecca Campbell will serve as chairwoman, international operations and direct to consumer.

Alan F. Horn and Alan Bergman will oversee the studio division that includes creating movies and other content from the company's IP line that includes The Walt Disney Studios, Pixar Animation Studios, Marvel Studios, Lucasfilm, 20th Century Studios, and Searchlight Pictures.

Peter Rice will be responsible for creating general entertainment and original programming for the company's streaming services and cable and broadcast networks such as ABC, Touchstone, Disney Challens, FX, and National Geographic.

And James Pitaro will focus on ESPN and other live and original sports programming contents. 

Former Disney CEO Bob Iger will continue to serve as an executive chairman and direct the company's creative endeavors.