Who Will Be the King of Online Content: Netflix Versus Disney—Data Sheet
This is your Data Sheet for Thursday, October 3, 2019
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(Fortune senior writer Michal Lev-Ram is filling in for Adam today.)
One particular line in columnist Maureen Dowd’s excellent, recent interview with Disney CEO Bob Iger in The New York Times caught my attention: “What Netflix is doing is making content to support a platform,” the long-time head of the Mouse House told Dowd when asked about his deep-pocketed, Silicon Valley competitor. “We’re making content to tell great stories. It’s very different.”
With all due respect to “Hollywood’s nicest CEO,” as Dowd refers to Iger, I’m not so sure I understand—or buy—the distinction. Netflix is just as interested in making content to tell great stories as Disney is interested in making content to support a platform, especially now that it is launching its own streaming service. (Disney+ makes its debut next month.) What I do agree with, though, is that content is king, regardless of the distribution pipes. And I also agree that, with streaming services well on their way to ubiquity in much of the developed world, content will soon not just be key but the sole differentiator in the battle between entertainment juggernauts like Disney and Netflix.
Iger didn’t explicitly make either of these latter statements in his interview with Dowd, which focused on his impressive career and his new memoir, The Ride of a Lifetime. But his strategy over the last few years shows that he has placed “great stories” above all, a move that’s arguably as prescient as Netflix’s early pivot from DVDs to streaming.
In late 2014, I wrote a profile on Iger, highlighting the many ways in which the CEO had made big and early bets on new technologies. Under his leadership, Disney was the first entertainment company to put TV episodes on iTunes. Iger also rolled out RFID-enabled wristbands at Disney World and was an early adopter of drones (to shoot film footage) and virtual reality (to “see” the blueprints of his then-nonexistent Shanghai theme park).
But in the years since my story, it often seemed Iger was lagging behind—more than a decade after Netflix launched its streaming service, Disney is finally unveiling its own. That’s one way to interpret his timing. Another way, though, is to realize that my story didn’t focus nearly enough on the other big bet Iger made: While Netflix was building out its pipes and its streaming audience, Iger invested billions of dollars in content. Not just any content, but the best content. The kind that makes for valuable, long-lasting intellectual property.
Over the years, Iger bought up Pixar, Marvel, Lucasfilm and, most recently, 21st Century Fox. Now, as Disney finally launches its long-awaited streaming service, Netflix is trying to amass a library of original content not just big enough but great enough to match Disney’s ridiculously rich, must-see archives.
Which one has the tougher challenge? I’m not sure. But I do know that for both companies, it comes down to telling great stories—so great that they will support a platform.
Michal Lev-Ram
On Twitter: @mlevram
Email: michal.levram@fortune.com