An activist investor in ESPN parent Walt Disney Co. is reportedly pushing for an unprecedented building of the ESPN+ and Netflix streaming services—just as Netflix is accelerating its sports ambitions.
Nelson Peltz, whose Trian Fund Management controls nearly $3 billion in Disney stock, is set to publish a white paper detailing proposed reforms for the company, according to Bloomberg. For more than a year, Peltz has actively lobbied for Disney CEO Bob Iger and the company’s board of directors to take much more active steps to improve the value of the company’s stock, which is roughly half its value from March 2021. Trian is also seeking two seats on Disney’s board.
The Trian white paper—reportedly due soon after Disney next reports quarterly earnings, on Feb. 7—notably advances a concept of streaming bundling more broadly gathering greater attention in media circles. Disney already sells its ESPN+, Disney+, and Hulu services in a discounted bundle. But subscription fatigue and concern about customer churn increasingly are factors across the streaming landscape, leading to greater discussion across the industry about reformations in various forms of the traditional cable bundle in this space.
The proposed bundling of ESPN+ and Netflix would be designed as a means to promote profitability of Disney’s streaming operations, which lost $387 million in its most recent quarter. There is no indication, however, whether either company would be open to such an agreement. Disney has previously resisted Trian’s overtures.
Netflix last week struck a major deal with WWE for live rights to Raw, and solidified its status as the world’s leading streaming service. Disney, meanwhile, continues to consider a potential partial equity sale of ESPN.