Disney CEO Bob Iger shares outlook on streaming rebranding at Morgan Stanley conference

Yahoo Finance entertainment reporter Allie Canal discusses comments from Disney CEO Bob Iger that touched on the futures of Disney+, Hulu, and ESPN+.

Video Transcript

SEANA SMITH: Well, Disney CEO Bob Iger doing a Q&A today at the Morgan Stanley Technology, Media, and Telecom Conference, giving some insight into Disney's position, place in the ever-going streaming wars. Yahoo Finance's own Allie Canal is here with her vibe check on the call, those key takeaways. Give us the vibe check first. What did you think?

ALEXANDRA CANAL: The vibe check, I would say it was generally positive. And that's because I do think, although we don't have all the answers to all the problems at Disney right now, I do think Bob Iger set a very clear tone of where he wants to take the company. He did touch on quite a few topics, from succession plans to what will be key to profitability. My top three takeaways, though, centered around pricing, Hulu, and ESPN+.

On the topic of pricing, Iger did make it clear that right now Disney+ is probably a little too cheap. He said it's very easy for consumers to jump around to different streaming services, and although he is very proconsumer, rationalizing that pricing strategy will be a key driver when it comes to profitability. Here's a bit more of what he had to say about that.

BOB IGER: Obviously we have to attract more subs, but I think one of the key things that we have to figure out is a pricing strategy that makes sense. I think in our zeal to grow global subs, I think we were off in terms of that pricing strategy, and we're now starting to learn more about it and to adjust accordingly.

ALEXANDRA CANAL: Keep a lookout for any possible pricing updates there over the next few quarters.

Another thing he also discussed was Hulu, and basically the future of Hulu, it's TBD. Disney controls 2/3 of the streaming giant. Comcast controls the rest, and a decision will need to be made by January 2024 per that contract. So will they keep? Will they sell? Right now, all options are on the table. Take a listen.

BOB IGER: So it's a solid platform, and it's also a very attractive platform for advertisers. It's already proven to be valuable for them, and advertising has proven to be valuable for us. But the environment is very, very tricky right now, and before we make any big decisions about our level of investment, our commitment to that business, we want to understand where it could go.

ALEXANDRA CANAL: So a more strategic approach to Hulu relative to that macro environment.

And then finally, very similar to Hulu, the murky future of ESPN, ESPN+. That has long been debated by investors, but Iger remained confident that the ESPN brand is a strong one. Take a listen.

BOB IGER: Down the road at some point, I think it's inevitable because of what's happening in media and the world and technology. It will become a direct-to-consumer business. And when you give-- when you combine the strength of live sports and the brand and the value of advertising so that you can create a business that's not just subscriber dependent but dependent on advertising and subscriber revenue, I think there's a reason to be bullish.

ALEXANDRA CANAL: There you have it. He did say he's open minded to ESPN's future, so potentially at some point maybe Disney could spin off the network or maybe sell just a stake in it. But from judging these comments and especially the fact that Disney recently restructured the business-- ESPN is its own standalone unit-- I don't think that's happening any time soon.

But Iger, he's just this force when he speaks. He's very clear, and he also demonstrated that he's willing to pivot depending on what's going around in the environment and the streaming wars.

DAVE BRIGGS: Let me ask you just your opinion. Does separating, siloing ESPN allow them maybe an easier path to embrace sports gambling? Because that has been begged for by investors.

ALEXANDRA CANAL: He did mention sports gambling. He said right now there are no current opportunities, but he thinks it's inevitable that at some point sports programming and sports betting have to be intertwined. He even talked about his two younger sons. He's like, I don't really want them to get into sports betting right now, but I know that's something they're interested, and--

DAVE BRIGGS: They're already doing it.

ALEXANDRA CANAL: I know, right? He's like-- that's what he basically said. And he said for younger consumers, this is important. But that has always been the argument, right? If you separate ESPN, maybe that makes the sports betting a little easier.

DAVE BRIGGS: More palatable because they're not attached to Mickey Mouse.

ALEXANDRA CANAL: Right. Exactly.

DAVE BRIGGS: Yeah, that's the perception.

ALEXANDRA CANAL: But look, he didn't come out and say absolutely not, so I guess we'll see.

SEANA SMITH: Sounds like it might be on the table. All right, Allie Canal, thanks so much.