Column: What Mulan Could Mean for Disney+ and the Future of Movie Distribution

Kelly O'Grady
Kelly O'Grady is dot.LA's chief host & correspondent. Kelly serves as dot.LA's on-air talent, and is responsible for designing and executing all video efforts. A former management consultant for McKinsey, and TV reporter for NESN, she also served on Disney's Corporate Strategy team, focusing on M&A and the company's direct-to-consumer streaming efforts. Kelly holds a bachelor's degree from Harvard College and an MBA from Harvard Business School. A Boston native, Kelly spent a year as Miss Massachusetts USA, and can be found supporting her beloved Patriots every Sunday come football season.
Column: What Mulan Could Mean for Disney+ and the Future of Movie Distribution

Looking for something to do this holiday weekend? Grab the (microwaved) popcorn and 'let's get down to business.'

Disney is releasing its live-action remake "Mulan" on Disney+, with potentially groundbreaking implications for how tentpole films are usually released.

If you're a Disney+ subscriber, you can gain exclusive access — but you will have to pay $29.99 on top of the monthly subscription fee. To purchase, head to your Disney+ app on Apple, Roku and Google platforms or to Disney+'s website. You'll retain the film for as long as you remain a Disney+ subscriber. But if you're planning to catch "Mulan" when it's added to the general Disney+ library, you'll have to wait until December 4th.

I worked as a senior analyst at Disney when it was just beginning to devise how to bring its content direct-to-consumer. This is another shrewd business experiment for the media giant to test out a little disruptive distribution. Streaming has become a core part of its strategy as the pandemic wreaks havoc across traditional revenue streams. And as many users hop between streaming services, the "Mulan" release may give Disney+ a well-timed incentive to keep customers from cancelling subscriptions while they await the next season of "The Mandalorian." Giving its users sustained access to one of 2020's only films — and a key addition to its princess franchise at that— could give Disney+ a stickiness advantage over its competitors.

So how should you evaluate whether Mulan's release is a success?


The New Economics of the Release

Let's consider the pure revenue economics of the film. From the outset, the potential audience pool is smaller compared to a wide theater release. By limiting purchases to Disney+ subscribers, you eliminate the prospect of reaching every individual that has access to a theater. And while not everyone frequents theaters regularly, the number is certainly higher than the service's subscriber base.

"Mulan"'s debut may incentivize new Disney+ sign ups though, adding to an already hefty base of around 60 million subscribers. Now, "Mulan" is the first Disney live-action remake to receive a PG-13 rating for "sequences of violence" — something which may deter parents from picking it for family movie night — but that could be counterbalanced if the movie can draw in the young male demo, where strong female-led films tend to struggle.

These recent live-action films have grossed anywhere from around $400M to $1.7B worldwide. A key caveat to remember is that on Disney+ entire families will watch "Mulan" together, rather than purchasing a separate ticket for each viewer at the theater (families, this is actually a steal for you). So if we assume "Mulan" measures up against its peers creatively, roughly a quarter of those 60M subscribers would have to pay $29.99 to compete on the low-end performance of ~$400M. And to pass the coveted $1B mark? Over 50% of Disney+ users would need to purchase access.

Now, this back-of-the-envelope math solely considers Disney+ and does not take into account that "Mulan" will receive a traditional release in countries where cinemas are open and Disney+ is not available — like China. Regardless, the Disney+ release will have to convert a significant portion of its base to bring in as much as a traditional theatrical release — albeit a base of proclaimed Disney fans.

Streaming Subscriptions

The complicating factor is that a dollar spent with the streaming platform is more valuable to Disney than one spent at the theater. With a traditional release, cinema distributors take about 40-50% of box office revenue over a film's run, whereas an Apple or Google will only take 30%. And if a subscriber purchases directly via the Disney+ website, Disney keeps 100%… not to mention the increased revenue from potential new signups. It is an intriguing nuance that will certainly impact Disney's evaluation of future release strategies.

Business Unit Monetization

The other key aspect is the business unit halo effect. What makes Disney special is its franchise monetization engine. Although difficult to quantify, Disney evaluates how intellectual property can be leveraged beyond a film, into merchandise, experiences, and spin-offs. Social distancing has revealed where that engine is vulnerable. Disney won't be able to repeatedly engage fans on a theme park ride or at retail stores, which could make it difficult to build a strong franchise. The Disney+ release will not address those challenges. Further, downstream revenue from DVD and digital sales will suffer from this move. There is no need to buy another copy of "Mulan" when your purchase lives in your Disney+ app.

Branding and Data

There is significant upside to be captured, though. When subscribers can rewatch "Mulan" whenever they like, it makes it much easier and faster for Disney to create a legion of superfans and to build brand affinity. Further, the direct access to "Mulan" purchasers' data is invaluable — something impossible to capture for theatergoers. When the pandemic does pass, Disney will have a more sophisticated understanding of its fans and can use that to better engage consumers across its businesses. They will know you're not only a "Mulan" fan, but that your family also frequently watches "Frozen"; don't be surprised if you get a targeted invite to hang with Olaf at the parks.

With all these dynamics at play, how the "Mulan" experiment turns out will have important repercussions not just for Disney, but Hollywood in general. While I doubt the movie's success or lack thereof will completely overhaul the way movies are currently released, I think that we will see lasting changes, from the way studios experiment with a variety of distribution methods to a reduction of the length of time movies stay in theaters.

Different studios are likely to have different strategies for each of their films, but the belief that a tentpole movie needs to start with a theatrical release is about to be tested.

___

Kelly O'Grady heads up video for dot.LA and serves as chief host & correspondent. You can watch her speak about Disney here. Find her on Instagram @kfogrady and email her at kelly@dot.LA.

https://www.instagram.com/kfogrady/
https://www.linkedin.com/in/kelly-o-grady-61714248/
kelly@dot.la
🍵☕️Top 6 Coffee Alternatives for Enhanced Productivity

In the fast-paced world of startups and venture capital in Los Angeles, maintaining peak productivity is essential for founders and investors alike. As the hustle intensifies, many are seeking alternatives to traditional coffee that not only provide a sustained energy boost but also support overall health and well-being. The following list highlights some of the top-rated coffee alternatives that can enhance focus and productivity while minimizing the adverse effects of caffeine. These options incorporate adaptogens, superfoods, and gut-friendly ingredients, making them ideal choices for those looking to optimize their performance without the afternoon crash.


Matcha

Image Source: Jade Leaf Matcha

Matcha is a finely ground green tea that offers a moderate amount of caffeine, along with L-theanine, which promotes relaxation without drowsiness. This combination can enhance focus and concentration, making matcha a suitable alternative for those looking to boost productivity without the jitters of coffee.

Popular Brands: ReNude Chaga Matcha (60 mg caffeine), Golde Pure Matcha (60 mg caffeine), Organic Ceremonial Matcha - Teahouse Edition (30 mg caffeine)


Dandelion Root Coffee

Image Source: Amazon

Dandelion root coffee is a caffeine-free alternative that mimics the taste of coffee. It is known for its potential to support liver health and digestion, which can contribute to overall well-being and productivity. The drink can help avoid the acidity and jitters that often accompany regular coffee, making it a gentler option for those sensitive to caffeine.

Popular Brands: Dandy Blend (0 mg caffeine), Teeccino Dandelion Dark Roast (0 mg caffeine)


Adaptogenic Drinks

Image Source: MUD\WTR Masala Chai

Adaptogenic beverages, which include ingredients like ashwagandha, reishi, and maca, are designed to help the body adapt to stress and promote mental clarity. These drinks can provide a sustained energy boost without the crash, supporting productivity throughout the day. They are often made with superfoods and spices that enhance both physical and mental performance.

Popular Brands: MUD\WTR Masala Chai (35 mg caffeine), Four Sigmatic Think Coffee (150 mg caffeine), ReNude Chagaccino (0 mg caffeine)


Golden Milk (Turmeric Latte)

Image Source: Golde

Golden milk, made from turmeric, ginger, and milk (or a milk alternative), is a caffeine-free option that can improve mood and reduce inflammation. The calming properties of this drink can help maintain focus and clarity, making it a great addition to a productive morning routine.

Popular Brands: Golde Turmeric Latte Blend (0 mg caffeine), Blume Turmeric Blend (0 mg caffeine), Four Sigmatic Golden Latte Mix (0 mg caffeine)



Chicory Root Coffee

Image Source: Teeccino

Chicory root coffee is an excellent alternative that satisfies the desire for a warm beverage without caffeine. It is rich in inulin, a prebiotic fiber that aids in digestion and promotes gut health by supporting beneficial bacteria. Chicory coffee has a nutty, earthy flavor and can help control blood sugar levels, contributing to overall energy and productivity throughout the day.

Popular Brands: Anthony’s Instant Chicory Root (0 mg caffeine), Teeccino Chicory Coffee Alternative (0 mg caffeine)


Yerba Mate

Image Source: Guayaki Yerba Mate

Yerba mate is a traditional South American herbal tea made from the leaves of the Ilex paraguariensis plant. It contains about 40-80 mg of caffeine per serving, which is less than a standard cup of coffee but enough to provide a gentle energy boost. Yerba mate is rich in antioxidants, vitamins, and minerals, and users often report feeling energized without the jitters or crashes associated with coffee. It has a unique, slightly bitter flavor and can be enjoyed in various forms, including loose-leaf tea and pre-brewed options.

Popular Brands: Guayaki Yerba Mate (40-150 mg caffeine)


Download the dot.LA App

LA’s Data Center Supply Crunch

🔦 Spotlight

Happy Friday Los Angeles!

The Los Angeles data center market is experiencing a significant supply crunch, ranking 12th in growth among top markets since 2020 with only 265 megawatts of colocation inventory (data centers where businesses rent space to store their computing hardware and servers). Despite this, demand is surging, driven by AI, cloud, and hyperscaler needs, with AI accounting for 20% of new data center demand nationally. This scarcity is creating a highly competitive environment, with vacancy rates at a record low 3% and asking rents rising 13-37% year-over-year. For Los Angeles, this presents both challenges and opportunities in the big picture. The city's strategic position as a global entertainment hub and its connectivity to international markets through subsea cables make it an attractive location for data centers. However, the limited inventory and rising costs could potentially hinder growth and innovation in the tech sector. To maintain its competitive edge, Los Angeles will need to address these constraints through new developments, such as GI Partners' 16 MW addition at One Wilshire, and by focusing on high-connectivity, high-power capacity submarkets. The city's tech community should prepare for a landscape of increased competition for quality data center space, higher costs, and the need for innovative solutions to meet growing demand, particularly in AI and cloud services. While Los Angeles faces a challenging data center supply crunch, its strategic advantages and ongoing developments offer a promising path forward.


🤝 Venture Deals

LA Companies

  • Daisy, a one-year-old startup that designs and installs smart home and office technology systems, raised a $7M Series B co-led by Goldcrest and Bungalow, with previous investors Bullish and Burst Capital also stepping up. The company has raised a total of $13.3 million. - learn more

LA Venture Funds


    ✨ Featured Event ✨

    LA TECH CEO SUMMIT

    LA’s tech leadership is set to reunite after a long break! This two day summit will focus on building strong connections, sharing insights, and fortifying the local tech community.

    Learn More Here

    Register Here


    Download the dot.LA App

    🌐Decentralizing Data & Vacations: Sony's Web3 Leap and Sensible Weather's KOA Partnership

    🔦 Spotlight

    Happy Long Weekend Los Angeles!

    Sony Group is making a significant push into the blockchain and Web3 space, leveraging its Sony Pictures and Sony Music divisions along with a new global incubator. The company has developed the Soneium blockchain through Sony Block Solutions Labs, a joint venture aimed at accelerating Web3 innovation. Sony is launching the "Soneium Minato" public testnet and a developer incubation program called "Soneium Spark" to foster ecosystem growth and adoption. The initiative includes strategic partnerships with Web3 companies such as Astar Network, Circle, and Optimism. Sony aims to create a fan community centered on creators and connect diverse values through Soneium, with the ultimate goal of integrating Web3 services into people's daily lives. While the company acknowledges the challenges faced by Web3, including limited user adoption and the need for mainstream use cases, it remains committed to decentralizing the concentrated power of the current internet landscape.

    In completely unrelated and more digestible news Sensible Weather, a leading weather protection provider that we’ve featured many times, has partnered with Kampgrounds of America (KOA) to offer Weather Guarantees at over 450 KOA Campgrounds across the United States. This collaboration allows campers to purchase weather protection for their outdoor experiences, providing peace of mind and potential reimbursements of up to 100% of their nightly rate if weather conditions exceed predefined parameters. The partnership comes at an opportune time, as camping has seen a significant increase in popularity, with active campers growing by 68% over the past decade. If you are looking to do some camping this fall make sure you look into Sensible Weather protections to ensure that unpredictable weather won't dampen (nailed it) your camping experience.


    🤝 Venture Deals

    LA Companies

    • Space and Time, a blockchain data warehouse developer, raised a $20M Series A led by Framework Ventures. - learn more
    • Miris, a provider of spatial content streaming solutions, raised a $26M Seed Round led by IAG Capital Partners. - learn more

    LA Venture Funds

    • Fika Ventures led a $4.55M Seed Round for Revenew, a San Francisco startup that aims to help digital platforms and marketplaces manage their payments and optimize financial operations. - learn more
    • Bonfire Ventures participated in a $25M Series A for Supio, an AI platform for personal injury law firms. - learn more
    • Amplify LA participated in a $2M Seed Round for Pryzm, a startup that provides tools and data to help businesses navigate government contracting more efficiently. - learn more

      ✨ Featured Event ✨

      LA TECH CEO SUMMIT

      LA’s tech leadership is set to reunite after a long break! This two day summit will focus on building strong connections, sharing insights, and fortifying the local tech community.

      Learn More Here

      Register Here


      Download the dot.LA App

      RELATEDEDITOR'S PICKS
      Trending