Opinion

21st Century Disney: Maintaining a legacy

27 March, 2019 Share socially

The Walt Disney Company’s huge £71.3bn acquisition of 21st Century Fox will “bring an unprecedented collection of content and talent to consumers around the world”, according to the company.

Without a doubt, it confirms their position at the top of Hollywood as together, they command 35% of the movie market. This status is echoed in our 2018 FutureBrand Index, where Disney topped the rankings for the first time. Since its inception, Disney has led the way in entertainment by flexing its approach as times change. It has also added to its portfolio whilst staying true to its original 1923 purpose; ‘to be one of the world’s leading producers and providers of entertainment and information’.

Disney - FutureBrand Index 2018
21st Century Disney: Maintaining a legacy

Significantly, this latest acquisition represents a retaliation against the technology and streaming players disrupting the industry on both sides of the camera, but it also confirms that a new era of entertainment has arrived, one where a healthy profit margin is no longer achievable simply through blockbuster film releases.

As the pace of disruption has heightened, particularly with tech giants like Netflix and Amazon moving more aggressively into Hollywood, Disney are taking the fight to them, reshaping the media landscape with a move away from traditional media company and towards technology and streaming. 21st Century Fox adds even greater scale and content to Disney ahead of their much anticipated on-demand service, Disney+, that could slow Netflix’s ascension and bring serious competition to the direct-to-consumer business that they define.

According to our Index, Disney’s top drivers are all experience perceptions that witness their purpose: having an engaging personality, being pleasurable and having a great story. Overall, admiration for Disney has markedly improved in the last 2 years (up to 36% from 25%), and there is an increased perception of Disney as a brand that’s moving forward (up to 66% in 2018 from 57% in 2016). Disney+ may increase this further, as they aim to leapfrog Netflix who received one of the highest perceptions scores for moving ahead in the next three years (70%). They will need to ensure that they effectively balance technological sophistication with human understanding to do so.

'Where do you see this company today, and 3 years time?'

21st Century Disney: Maintaining a legacy

It won’t all be plain sailing, however. The Fox acquisition presents Disney with a tricky and complex challenge as they attempt to integrate two very separate corporate cultures. With the requirement of $2bn in savings as part of the deal, layoffs are expected – the brunt of which will be taken by Fox. Disney needs to implement an effective and well-managed engagement process internally, whilst ensuring that the new portfolio doesn’t lead to confusion for consumers and investors alike.