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Warner Bros. Discovery is merging its owned and operated experiences division with its licensed entertainment division to form the new Global Experiences division — an attempt to exert greater creative and financial control over the experiences built from the studio’s IP.
The Big Picture: Younger consumers are spending more money on experiences than any previous generation. Now, every studio and streamer is either expanding or launching experience-driven divisions in order to capitalize on the trend and further build out valuable IP.
Between the Lines: WBD believes that it’s time to level up its experiences business.
- The new division, run by WBD Studios COO Simon Robinson, will house studio tours, retail destinations, location-based experiences, theme parks, and touring exhibitions of props and costumes from movies and shows.
- It has two directives: expand its experiences (like the famous Warner Bros. Studio Tour around the world) and find more opportunities for lucrative licensing of its IP (like The Wizarding World of Harry Potter at Universal Studios).
Closing Thoughts: Disney’s and Universal’s events and theme park business have always been the envy of Hollywood, but that has really ramped up the past few years. Netflix, Sony, and Lionsgate have all broken out the checkbook to dive further into the experience economy. WBD CFO Gunnar Weidenfels recently said its experiences group is “about a half billion dollar revenue business.” Considering the company’s recent financial woes, upping that revenue could help cut down on debt and make WBD a more attractive acquisition target.
Go Deeper: While WBD may turn Scooby-Doo and Looney Tunes into hit experiences, it hasn’t recently felt confident about doing that with its movies.
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