In a crowded market, studios and streamers know content has to stand out.

“It needs to be excellent,” said Charles Schreger, a professor at NYU and Fordham and a former HBO executive. “One of the ways that it can be excellent and get attention is by being expensive.”

Schreger says Disney’s good at making expensive content effectively; it said in its earnings call this week that it’s on track to spend at least $30 billion on content in the current fiscal year.

On that same call, Disney CEO Bob Iger, newly back in the lead  role at the company, announced that it’s time for the company to go through what he called a “transformation.” That includes cutting $5.5 billion in expenses, part of which will be laying off 7,000 employees. Iger also said he’s going to focus on the economics of its streaming services by leaning in to proven franchises while aggressively tailoring some of its other content. 

“They’re very clear in talking about supporting their big franchises. So it’s not like they’re going on an austerity effort in making the next Marvel or Star Wars property,” said Brian Wieser, principal at Madison and Wall, a strategic advisory firm.

Charles Schreger at NYU and Fordham calls this the blockbuster strategy.

“It’s smarter to make a bunch of really expensive movies than it is to have a larger portfolio of inexpensive movies,” said Schreger.

For its linear TV channels, Disney may also invest in shows that it thinks will have a long life on streaming, per Paul Erickson of Erickson Strategy and Insights. 

“So, ‘should we commission another season of this particular show?’ ‘Well, yes, because we know that it has a really loyal fan base,’” said Erickson.

Erickson says we may be less likely to see Disney take chances on unknown stars or new genres.

“I think it continues a trend of what’s already been happening in the world of film,” said film and television producer Kary Antholis, whose work includes the limited series “Black Bird” and “We Own This City.”

He expects Disney to take fewer risks. 

“They may have less money to do those kind of grown up-oriented, sophisticated narratives in favor of more series based on the Star Wars or Marvel franchise,” said Antholis.

There’s another big benefit for Disney to doing this: it makes the public more attached to these characters. Because the more people see Elsa and Baby Yoda on screen, the more they’ll want to see them in other places.

“You feel good about Disney. So then perhaps you take a cruise, perhaps you feel good about going to one of the Disney parks,” Schreger said.