Disney outsources DVD and Blu-Ray operations in partnership with Sony

A Disney announced a significant change to its home entertainment division by closing a deal with Sony Pictures Entertainment.

Under the new arrangement, Sony will be responsible for operating Disney DVDs, Blu-Ray discs and other physical media.

This strategic move represents Disney’s adaptation to changes in the market, especially with the continued decline in physical media sales.

Home Entertainment Division

The established partnership implies that the Sony will be in charge of the production, marketing and distribution of Disney releases and classics in physical media in the United States and Canada.

However, Disney will maintain management of its own digital media, including premium video-on-demand services.

The current scenario, marked by the rise of streaming and the decline in physical media sales, motivated Disney to seek a more efficient approach to meeting consumer demand.

Physical media revenue in the US recorded a 28% drop in the first half of 2023, compared to the previous year, signaling a trend that continues amid the streaming boom.

Sony will be in charge of distributing Disney products – Disney/Reproduction

While it is unclear whether the transition will result in layoffs at Disney, sources indicate that the studio will conduct an internal assessment of business functions related to physical entertainment in the process of transitioning to Sony.

The licensing model adopted will allow Disney to offer its films and TV shows through physical retailers, while responding more quickly to consumer demands.

The company emphasized that such a change is consistent with its global strategies and similar transitions in other sectors.

Disney’s decision comes in a context of transformation in the entertainment market, in which sales of physical discs are in constant decline.

This strategic partnership with Sony reflects the companies’ continuous search for business models that are more aligned with current industry trends.

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