Is Netflix the Happiest Place on Earth for Disney?

In a 2012 deal, Disney sold the rights to stream their new movies on Netflix seven to nine months after they are released in theaters. This deal also includes movies and television shows from Disney’s major franchises: Pixar, Lucasfilm and Marvel.

This deal came into affect for new movies released after January 1, 2016, as Netflix viewers noticed big blockbusters like “Captain America: Civil War” and “Alice Through the Looking Glass” pop up in in their recently added list.

Previously, Starz had the exclusive rights to Disney movies for a paid subscription channel. Being that Disney is one of the largest media conglomerates in the world, exclusivity holds immense power.

However, Disney foresaw a cultural shift towards online streaming and viewing, and it jumped on the chance to target the largest audience base.

This deal is not from the nice side of Disney, trying to release various movies on one platform. This is a smart business move that incredibly benefits Disney.

According to Marxism, businesses do not operate for the betterment of society. Ultimately, strive to obtain the most profit.

Unlike some of the other “Big Six” media companies, Disney does not own a premium movie channel. It lacks this straight integration of their competitors, but this also makes Disney’s movies more lucrative.

Before this deal, Netflix had the license to some of the older Disney movies. Other than Netflix, the public had to buy the DVDs of Disney movies when they were randomly released from the vault or wait until they played on a Disney affiliate channel, such as ABC.

Now, Netflix can play both older and newer Disney movies whenever the audience feels like it.

Currently, Netflix has nearly 94 million subscribers worldwide. In comparison, HBO had 134 million subscribers in 2016.

While technically premium channels have more subscribers, Netflix’s audience base grew at a rapid rate compared to the gradual build of traditional television.

By concentrating the release of their movies to only one location, that makes Netflix elusive and a destination for viewers. This benefits Netflix as it draws in the Disney audience while Disney benefits by potentially targeting a larger demographic.

At the end of the day, Disney is a company. It will do whatever serves the company’s best needs and boost an overall profit.

By striking a deal with Netflix, it shows that Disney is recognizing the growing trend of audiences gravitating towards a web-based streaming service.

Also, this deal only lasts for three years. In profit maximization, change is scary. The logic of safety says success works best and changing that is financially risky.

By having a shorter time limit on this deal, this protects both companies. It gives them time to evaluate results before they are locked in to a potentially profit draining long-term deal.

Lastly, there are even rumors Disney might buy Netflix entirely. This would only increase the power of Disney, further strengthening their media conglomerate.

Disney already has a major role in the concentrated nature of the media industry, and the addition of Netflix would then put Disney into a new media field it hasn’t fully dipped their toes into.

It’s true Disney owns 1/3 of Hulu, but this joint venture is shared with other media companies. It lacks a direct streaming premium channel of its own.

If Disney does purchase Netflix, this would be their sole entrance into the paid-for television industry.

The real magic of Disney is the vast power it has and the profits it gain because of it.

It’s fun to speculate on the sheer magnitude of power in the media industry Disney would have if it did ultimately buy Netflix. But, it is kind of scary to think about how one entity could control that much of the media industry.

In the meantime, I’m just going to watch “Zootopia” and try to not think about how Disney is probably going to take over the world someday.