Embedded in Disney’s (DIS) latest filing with the SEC is a claim that might go down as a first in the annals of big media: Disney says it now has a meaningful digital business.
How meaningful? Disney won’t say. But it says it was enough to help its broadcast TV group (the ABC network, plus the local stations ABC owns) show a slight revenue increase over last year in the face of a cratering ad market.
Disney’s broadcasting revenue came in at $1.531 billion, up $7 million from the $1.524 billion the unit took in a year ago. That in itself is an achievement, considering the lower ratings at ABC and the decreased advertising revenue from automotive, consumer electronics and financial services. How’d they do it? In part, through digital revenue from ABC.com that went to the network and local stations, as revenue from the kids virtual world Club Penguin. Disney explains:
Broadcasting revenues increased $7 million reflecting higher internet revenues, partially offset by lower advertising revenues at the owned television stations. The increase in internet revenues included Club Penguin which was acquired in the fourth quarter of the prior year. Revenues at the ABC Television Network were comparable to the prior year as the impact of lower ratings was offset by higher advertising rates and digital media revenues.
Until now, big media has been careful to note that despite the hype, digital revenues are a trickle — an investment in the future but not meaningful today. That, in fact, is the core of their argument with the various labour guilds, which are looking for a piece of that revenue. Once, digital was fodder for press releases only. Now, it’s significant enough to tell the SEC about.
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