Disney Deep Dive: We’re Looking At Linear Vs. Streaming All Wrong


  • The official $4 billion loss for Disney streaming is somewhat misleading.
  • ESPN+ receives a roughly $1.5 billion subsidy per year from Disney+.
  • It’s at least conceivable, if not likely, that ESPN+ is in turn propping up linear ESPN, which could mean streaming is subsidizing linear.
  • Even if not, the existence of such hidden subsidies shows that the separation of linear and streaming profit is largely arbitrary.
  • If Disney does try to split off ESPN, it will have to come to grips with this issue and outline for investors and the buyer what it has been doing.

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Charley Gallay

As we prepare for the latest Disney (NYSE:DIS) earnings release – and the first since Bob Iger took over the company again from Bob Chapek – there are understandably a lot of moving parts in the company that investors want to

ESPN+ non-Bundle ARPU

Non-Bundle Subscribers (Author Calculations)

Disney Bundle Market Share Non-Bundle

Non-Bundle Subscriptions (Author Calculations)

Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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