‘Moana’ Was Key to Disney’s Comeback Year From the Beginning

As “Moana 2” cruises past $600 million at the worldwide box office, the animated hit has solidified a new period of smooth sailing for Disney. After the stormy seas of 2022 and 2023, the film is likely to become the studio’s third billion-dollar grosser of the year, after “Inside Out 2” and “Deadpool & Wolverine.”

But while Disney’s resurgence at the box office has defined much of the company’s narrative in 2024, focusing on theatrical elides the most significant triumph of the Mouse House’s comeback year.

That triumph was Disney, at long last, mastering the dual management of its theatrical and streaming businesses to the benefit of both and thereby affirming that, as long as its IP continues to hold sway over consumers big and small, the Mouse will have a seat at the table for the next era of media history.

To achieve this, CEO Bob Iger did extremely well in making one key pivot: following the advice laid out by VIP+ last year urging him to stop turning theatrical IP into streaming series.

“The financial return on a big-budget streaming series, even a successful one, is always going to be limited,” I wrote at the time, noting also that “theatrical movies with theatrical marketing campaigns have been shown time and again to generate substantial SVOD viewership.”

Therefore, this analyst continued, the company cautioned Iger to “stop trying to use expensive, IP-based shows to juice Disney+, and mine your library for theatrical plays instead.”

“Moana 2” will likely stand as the crowning achievement of this strategic pivot. The sequel was originally developed as a Disney+ series and changed course just months before its November release — a move that seems risky only until you realize its predecessor has quietly become one of Disney’s most valuable content assets.

The first “Moana,” which was released in 2016 and grossed less than $700 million worldwide, has consistently been one of the most-streamed titles on Disney+ since the platform’s launch. The film has ranked among the top five most streamed movies in the U.S. each year since 2020, according to Nielsen, and even claimed the top spot last year, beating out 2023 releases including “The Super Mario Bros. Movie” and Pixar’s “Elemental.”

“Since Nielsen began measuring streaming, audiences have watched nearly 80 billion minutes of ‘Moana,’ which translates to watching the full movie 775 million times,” the data firm noted in its 2023 year-end report.

And the film could very well pull off a repeat performance: “Moana” appeared on Nielsen’s weekly list of the top 10 most streamed movies almost every single week for the first three quarters of 2024, and the sequel should only help boost its viewership in what remains of Q4.

In light of this, a “Moana” streaming series follow-up may have seemed like the most obvious of no-brainers. But in pivoting to a theatrical sequel, Disney leadership proved it has finally learned that Disney+’s biggest strength is not in its original series but in serving as the gateway to Disney’s content catalog.

“Moana” is not the only theatrical film to draw significant engagement on the platform, with another Disney animated musical, “Encanto,” clocking in at second place on Nielsen’s 2023 list. Indeed, more than half that list was made up of Disney theatrical films, while only one Disney+ series, “The Mandalorian,” ranked among the top 10 streaming originals that year.

And while library titles such as “Moana” and “Frozen” generate substantial engagement, Disney+’s exclusive streaming window for most new Disney and 20th Century Studios films is a key viewership driver for the platform, as Iger himself acknowledged last year.

“One thing that we have recently really come to appreciate is the performance of our big title films, the so-called pay 1 window films, on the [Disney+] service,” the CEO said on an earnings call. “The numbers are huge. That’s a differentiator for us, certainly, when it comes to competing with Netflix.”

By reconfiguring the “Moana” series into “Moana 2,” therefore, Disney crafted a win-win for itself: massive theatrical revenues coupled with what will likely be “huge” Disney+ engagement once the sequel arrives on streaming, with repeat (and repeat and repeat) viewings by young children potentially turning “Moana 2,” like its predecessor, into a viewership driver for years to come.

Meanwhile, streaming series budgets have reportedly been tightening up under Iger. A Marvel Studios executive described this year’s “Agatha All Along” as Marvel’s “least expensive show” in an interview with Variety. And while Iger has yet to implement my advice to pursue more “singles and doubles” on the film side — that is, lower-cost projects with an easy road to profitability — this seems to be becoming the default strategy for television in the post-peak TV era.

After all, one of the biggest success stories under the Disney umbrella over the past few years is “The Bear,” a relatively lo-fi, low-cost series; the budget is some $3 million-$5 million per episode, according to Luminate Film & TV, making it, at most, about a third the cost of a season of “The Mandalorian.”

And with the patented Disney flywheel only recently starting to channel success from streaming back into theatrical — “The Mandalorian & Grogu,” a big-screen adaptation of the series, just entered production this year — it’s clear the theatrical-to-streaming pipeline is the studio’s best bet for maximizing value for high-cost productions.

And in that regard, much like its adventurous protagonist, there’s no telling how far “Moana 2” will go.