03/12/2021

Disney Announces Plan to Spend $33 Billion on Content in 2022

In case you thought the pockets of Mickey Mouse weren’t deep enough, The Walt Disney Company has confirmed that it will be spending 20% on content production next year compared to last year. As noticed by The Hollywood Reporter, Disney’s new SEC filing confirms their intent to spend $33 billion on content in the next fiscal year (which has technically already begun for the company), an increase of $8 billion compared to their $25 billion spent in 2021. In the filing, they write: “The increase is driven by higher spend to support our DTC expansion and generally assumes no significant disruptions to production due to COVID-19.” So what does $33 billion in content get you?

It would be easy to assume that this much money from Disney is being dumped exclusively into new content from the likes of Marvel, Lucasfilm, and Pixar, and that’s true to an extent but it’s not everything. In fact, the 2021 numbers from Disney confirm that the $25 billion spent on content last year was split almost 50/50 across production for original content and the licensing for other programs/rights to broadcast. The later of this is a key piece of Disney’s bottom line as the rights to broadcast NFL, NHL, NBA, and NCAA games are expensive, but they’re major pillars of ESPN programming and are clearly worth the investment.

In 2021 Disney spent $12.412 billion on “Licensed programming and rights” and $12.848 billion on production. We don’t have specifics for how this will shake out in 2022 with the all-new $33 billion number, but Disney has signaled that this is in large part due to their continued efforts to prioritize their streaming assets in Disney+, Hulu, and ESPN+.Comparing 2021 to 2020, Disney’s cost in “Licensed programming and rights” only rose 3%, so a similar bump could occur from 2021 to 2022.

We are extremely pleased with the success of our portfolio streaming services, Disney+, ESPN+, and Hulu continued to perform incredibly well with 118.1 million, 17.1 million and 43.8 million subscribers, respectively, for a total of 179 million subscriptions,” Disney CEO Bob Chapek said earlier this month during the company’s Q4 Earnings call. “To put this growth in perspective, in the past fiscal year alone, we have grown the total number of subscriptions across our DTC portfolio by 48% and Disney+ subs, in particular, by 60%. I want to reiterate that we remain focused on managing our DTC business for the long term, not quarter to quarter, and we’re confident we are on the right trajectory to achieve the guidance that we provided at last year’s Investors Day, reaching between 230 million and 260 million paid Disney+ subscribers globally by the end of fiscal year 2024, and with Disney+ achieving profitability that same year.”

For those interested in a comparison, THR notes that Discovery CEO David Zaslav previously announced that once his company merges with WarnerMedia they’ll spend $20 billion on content while Netflix will reportedly spend $14 billion. Once again we must point to sports rights however as Netflix isn’t spending any money on sports and WarnerMedia’s Turner brands are heavily invested in them to boot.

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(Cover photo by Thiago Prudencio/SOPA Images/LightRocket via Getty Images)

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