The flywheel strategy of producing only the best, highest-quality content infrequently is fundamentally incompatible with the streaming business model, which requires a constant fire hose of new content to retain subscribers.

(03:26:09) these really storied franchises. But am I going to pay $7 a month to keep an option available to go watch those things? No. If I ever want to rewatch a Star Wars movie, I'll just reactivate my subscription at a given time. They really do need to aggressively turn on a fire hose of content here. >> Oh man, you summed it up. [sighs] You summed it up. This is the problem. That

(03:26:34) whole strategy of a fire hose of content is completely orthogonal to >> yes >> the flywheel strategy of only the best content very infrequently >> and that is what Disney did the best content infrequently with a theatrical release a cultural moment around it and then be quiet for a while and and harvest the fruits of that one movie but be quiet for a while and streaming is

(03:27:03) the exact freaking opposite. It is every time I open that, there better be something new and fresh for me to consume. And I I got to wonder how much the Disney folks knew that when they made this decision to push all their chips in and accelerate going to streaming in a direct consumer way. Y >> the biggest issue really is that Disney had something to lose. They had two

(03:27:31) things to lose. They had an existing content library that was highly differentiated. And when you bolt things onto a universe of a differentiated library, it makes the original content less valuable. >> Yep. >> I remember watching the Obi-Wan TV show on Disney Plus and being like, "Oh man, that kind of shatters how I think about Obi-Wan." >> Yeah. It's not as cool as I thought it was.