Staff Reports
Wells Fargo analyst Steven Cahall dropped a provocation this week: The Walt Disney Company should stop trying to be a global streamer and go back to what worked for studios — make movies and license them out. Cahall argues that Disney would unlock huge cash by becoming an “arms dealer” of content and letting Netflix, Apple, and others pay to show Disney’s hits. It’s a blunt idea, and one that suddenly has investors asking whether Disney+ is worth the fight.
What Cahall is actually recommending
Cahall, a Managing Director and senior media analyst at Wells Fargo, says Disney should move away from running its own streaming platform as the main place to put its content. He uses numbers to make the point: by licensing big films and the vault of Disney catalogs, Disney could collect large pay‑1 and downstream fees instead of stuffing everything into Disney+. Cahall estimates this shift could materially lift the stock — he puts the upside in the many‑tens of percent range — and envisions licensing revenue in the billions once pay‑windows and library deals are re‑opened.
Why Disney keeps pouring money into Disney+
There’s a reason Disney clung to streaming like a startled raccoon to a picnic basket. Building a direct audience gives control over data, ad inventory, and how properties feed parks, toys, and theme‑park traffic. But the streaming business has hit a growth wall: subscribers aren’t climbing the way investors once hoped, and bundling and ad tiers are now band‑aids. Cahall’s point is simple — if Disney+ is failing to grow, why put every new hit into a service that may be shrinking its value?
Risks to the “arms dealer” plan — brand, parks, and politics
Licensing heroes like Marvel, Pixar, and Star Wars to competitors would create real tradeoffs. Disney uses its own platform to steer viewers toward merchandise, theme‑park interest, and franchise events. Handing pay‑1 windows to Netflix or another streamer could raise cash now but weaken the company’s control over timing, promos, and the cross‑sell engine that makes Disney more than a studio. Still, the question Cahall raises is governance and common sense: are shareholders better off chasing an expensive vertical stack, or getting steady, predictable licensing checks instead?
Bottom line — let Josh D’Amaro make the hard call
This isn’t a modest tweak. It’s a strategic fork in the road for CEO Josh D’Amaro and the Disney board. The Wells Fargo note deserves serious debate inside Disney’s walls and in the market. Shareholders have paid for a world‑class content machine; they didn’t sign up to bankroll a streaming experiment forever. If Disney wants growth, it should consider whether guarding content for a slowing platform is smart stewardship — or just sentimental loyalty to a failing strategy. The company can keep the magic; it just might have to stop trying to make Disney+ the whole castle.
