The fallout for the theatrical landscape in the wake of COVID-19 just keeps getting worse.
In a move that no one saw coming, Disney made a surprise announcement that they would forgo a theatrical release for their live action adaptation of Mulan altogether. Instead, it will debut exclusively on their Disney+ streaming platform on September 4, 2020.
But here’s the real shocker: it won’t be automatically available for subscribers. Instead, Mulan will only be offered on the platform via a premium rental rate of $29.99.
In other words, Disney is making their streamer the exclusive PVOD rental provider. (Click here for a follow-up report that defines what a renter gets for that $30 fee.)
According to a report in Variety, Mulan will only be released theatrically in global territories where Disney+ isn’t available.
Along with being a major disappointment to theater fans and a stunning blow to theater owners, this decision simply doesn’t make any sense.
Each time the release date has been delayed, Disney has remained publicly committed to a theatrical distribution for Mulan, both domestically and globally. There are the financial realities, too, in which the reported $200 million budget would need a healthy global box office haul to recoup that level of investment.
They’ve even disavowed any suggestions that they would bypass a theatrical run in favor of at-home platforms, emphasizing the importance of experiencing this expensive production on the big screen. As Disney Co-Chairman Alan Bergman put it:
- “Director Niki Caro and our cast and crew have created a beautiful, epic, and moving film that is everything the cinematic experience should be, and that’s where we believe it belongs — on the world stage and the big screen for audiences around the globe to enjoy together.”
But now? That belief is suddenly gone. Disney has resigned itself to simply using Mulan as a way to push subscribers to their streaming service. What an astounding about-face.
The only way I can make sense of this is that, given the current circumstances, Disney apparently lacks any faith that theaters will be able to open again any time soon, at least at a level that can support a global tentpole like Mulan. Given that, this decision seems to amount to nothing more than one of the biggest write-offs in studio history.
Disney CEO Bob Chapek emphasized that this is strictly a one-off decision due strictly to the pandemic, and that it’s not reflective of any new business model (whether in the short term or long term). The studio also stressed that other titles such as Marvel’s Black Widow would not follow the same path.
The surprise announcement also comes on the same day that Disney reported devastating quarterly earnings due to theme park closures. One would have to think that the two decisions are inextricably linked.
(UPDATE: To prove the point, Disney stock jumped 10% following the Mulan announcement, a significant boost in light of the down quarterly earnings.)
Bottom line: even if the exclusive Disney+ offering does boost subscriber numbers to some degree, the high PVOD rental price on top of the subscription rate would seem to undercut Mulan as a major enticement.
Simply put, Disney apparently believes that they’ll lose less money this way than if they continue to hold out for a new window in the future.
That, plus given the recent quarterly report, they need to pull in whatever monies they can through whatever means possible. It makes more sense to do that with a one-off movie like Mulan rather than an MCU entry that serves as an anchor in an ongoing theatrical franchise.
In addition, given their gigantic corporate structure, Disney may feel that they have the flexibility to experiment with something like this, to test the process and see what the numbers end up being. After all, they’ve effectively gone back on previous public commitments with this decision. If the numbers prove positive, they could go back on the declaration that this is a one-off.
At 60.5 million subscribers, Disney+ would need a little over half of its current base to rent Mulan in order to reach the $1 billion it was likely aiming for with a global theatrical run. Chances are, however, that garnering even 25% of its subscriber base to rent the title at that rate is likely too ambitious a number to hope for.
Indeed, even though the new option is cheaper for a family than going to the movie theater, most may decide that $30 is too much for one at-home viewing and, instead, wait a bit longer until it’s cheaper to watch it the same way.
The unique limitations of this release — i.e. to make it available only as a rental through Disney’s streamer, rather than widely through all VOD platforms — might be an attempt at a good faith gesture to theater owners who are, no doubt, livid over the decision. By keeping it so exclusive, Disney may actually be trying to temper theater owner anger.
The studio will make less money than if they decided to go with a mass PVOD availability, and a broad PVOD push would look like a dramatic move to undercut the theatrical process. By limiting the film’s at-home option so severely, Disney is likely sending a message to theater owners that they’re not trying to muscle them out of process altogether.
The gesture, however, may not be enough.
Charles Foxen, a theater programmer here in Tulsa, OK where I live, shared the following about what happened when Disney’s announcement went public — right in the middle of a nationwide Zoom meeting of the National Association of Theatre Owners:
- “We were in a NATO Zoom call talking about negotiating a shorter theatrical in exchange for shorter film run guarantees, better % terms, and the ability to have non-clean runs of films when this was announced. These are all talks that will change theatrical distribution for ever. When (the Mulan news) broke on twitter is was brought up in our meeting and, damn, not a lot of nice things were said about Disney. What a crazy time for the business.”
So there’s that.
Another response, in one tweet:
On the flip side, if this ends up being a gigantic dud, Disney may decide sometime down the road to give Mulan a limited theatrical run for all those people who never saw it.
After processing the initial hit of such a major announcement like this, I couldn’t help but think of the opening lyrics to the song from the original 1998 animated Mulan movie, “Honor To Us All”:
This is what you give me to work with
Well, honey, I’ve seen worse
We’re going to turn this sow’s ear
Into a silk purse
That may capture the spirit of what Disney is trying to do here, but I’m skeptical that the net result of their dramatic move will end up looking like anything more than the sow’s ear it currently is. Indeed, I don’t see it bringing honor to anybody, although it’s hard to judge such drastic decisions too harshly. There doesn’t appear to be any easy answers right now in these unprecedented times.