Walt Disney Co (NYSE:DIS) said it has restructured its media and entertainment arm in an effort to accelerate the growth of the recently launched Disney+ as well as other streaming services under its umbrella.
On Monday, the media titan said it will separate content production from distribution in a bid to be more responsive to consumer demands. The restructure will also involve the company’s studios, sports and general entertainment arms being brought under one division, with distribution and commercialisation to fall under a separate unit.
The new media and entertainment arm will be headed by Kareem Daniel, the former president of Disney’s consumer products, games and publishing business.
Disney also said that there may be redundancies as a result of the changes but the exact number is currently unknown.
The move follows pressure from Daniel Loeb, an activist investor at hedge fund Third Point, for the company to cut or scrap dividend payments to boost spending on content primarily targeted at its streaming platforms.
While Disney has now said it will be increasing spending on content, the status of the dividend has not yet been changed.
Aside from Disney+, the corporation also owns the Hulu platform as well as live sports streaming service ESPN+. Since its launch in November 2019, Disney+ has managed to amass over 100mln subscribers, thanks in part to the general boost to streaming services during the coronavirus pandemic.
Shares in Disney were up 4.5% at US$130.55 in pre-market trading in New York on Tuesday.