Continuing a busy week of public appearances, Disney CEO Bob Chapek told CNBC Thursday that his company needs to spend more than its current level of around $16 billion annually on direct-to-consumer content.
"When we first launched Disney Plus, we way underestimated how much fuel the beast needs to be where it can be," Chapek said, confirming the $16 billion figure CNBC host David Faber threw at him.
Also read: Brian Roberts: Comcast Would Buy Hulu Outright If It Were for Sale
Chapek seemed also confirm the $20 billion in DTC revenue data point that Faber also tossed out, as well as the $30 billion revenue figure for competitor Netflix.
The CEO conceded that Disney is looking to up its content spending. He listed Disney's "flexible distribution pipeline" as a key competitive advantage, with linear TV networks and a recovering theatrical pipeline augmenting the distribution "kingpin" that is streaming, providing effective ways to amortize costs in ways that Netflix can't.
"What we’re doing moving the chess pieces around, trying to figure out what the best combination is for all these channels," Chapek said.
The CEO, who also appeared last weekend at D23 in Los Angeles and Wednesday at the Goldman Sachs Communacopia & Tech Conference, maintained Disney's position that Disney Plus will be profitable by 2024.
He also said that we'll probably have to wait until that year before the fate of Hulu -- currently being haggled out with streaming JV's other owner, Comcast/NBCU -- will be decided.
"As 2024 becomes more and more imminent, the chances of a Hail Mary pass that enables us to come to earlier resolution becomes less and less likely," Chapek said. "I would like to come upon an earlier resolution myself, but it takes two parties to make that happen ... I'm optimistic. Who knows."
NBCU has an agreement to sell its 30% stake in Hulu to majority owner Disney in 2024 based on three times its asset value at the time of the sale. The two sides can't agree on how much that asset value is, or whether NBCU even still wants to sell its stake.
