Disney Highlights Original Content Push For Disney+, Hulu As It Consolidates TV Studios

Walt Disney Company DIS has restructured its television studios business, effectively consolidating its three TV units into two.

What Happened: The shakeup will see Karey Burke, the president of ABC Entertainment head 20th Television, while Jonnie Davis will stay at the helm of ABC Signature, according to Hollywood Reporter. 

Touchstone — previously known as Fox 21 — will be merged into 20th Television and its head Bert Salke, who oversaw the studio for the past ten years will move on to production after securing a $20 million deal, as per the Hollywood Reporter.

Salke is the only major executive to be laid off in the present round of restructuring and more executive redundancies are reportedly expected.

Why It Matters: The reorganization is geared at spurring the growth of Disney’s direct-to-consumer business, as per an internal memo published by the Hollywood Reporter.

"Our role is to supply breakthrough original content to Disney’s best-in-class streaming platforms Disney+ and Hulu, linear networks and third-party platforms; and to choose the original content that will fuel the Hulu Originals, ABC Entertainment and Freeform programming slates," the memo read.

Disney had 73.7 million paid subscribers for Disney+, 10.3 million paid subscribers for ESPN+, and 36.6 million Hulu subscribers, at the end of its fiscal year 2020. The company faces intense competition from Netflix Inc. NFLX and Amazon.com Inc.'s AMZN Prime Video in the streaming video-on-demand space.

Price Action: Disney shares closed nearly 1% higher at $149.44 on Tuesday.