Disney’s $30 ‘Mulan’ Release Is the Latest COVID Experiment, But Will It Work?

Last month, Disney CEO Bob Chapek announced the highly anticipated, big-budget remake of Mulan was coming to Disney’s streaming service on September 4. The catch? It will cost Disney+ subscribers an additional $29.99, on top of their monthly subscription fee. Twitter, immediately, was in a tizzy. Thirty bucks? For one movie?

Yes, $30 is roughly the price of two movie theater tickets in a major city. And yes, despite some initial confusion, that $30 means you’ll “own” Mulan, in the sense that you’ll be able to watch it on Disney+ whenever you want, as long as you stay subscribed. Still, we’ve gotten used to renting movies on Amazon and iTunes for $5 or less. Even $19.99 for Trolls World Tour feels closer to the price of a newly-released DVD. $29.99 feels more like the price of a DVD player.

But it’s easy to forget, as a casual movie viewer, just how fragile the “standards” for film releases actually are. Certainly, there is no protocol for how studios are supposed to react to a deadly pandemic that closes movie theaters across the world. Rich Greenfield, a Partner and Media and Technology Analyst at LightShed Partners—a New York-based technology, media, and telecommunications research firm—has been observing the various studio reactions since the world shut down in mid-March.

“In many aspects, the pandemic is giving movie studios the chance to try things,” Greenfield said, who previously spoke to Decider about Universal’s release of Trolls World Tour in April. “Whether it’s with Trolls, or whether it’s what Disney’s doing with Mulan—all of these studios are getting a chance to try new things. They’ve never had a ‘hall pass’ from exhibitors before.”

Universal was the first to use that hall pass by putting Trolls out on Premium Video-On-Demand, or PVOD—an industry term for when a movie releases on digital at the same time that it’s playing in theaters—for $19.99 in lieu of a theatrical release. And theater owners weren’t happy. AMC Theaters went so far as to threaten to never play another Universal movie again. That’s all water under the bridge now that the companies have made peace with a new deal that will allow Universal and it’s sister studio, Focus Features, to release films on-demand after a 17-day theatrical window; but still. The floodgates were opened.

It’s hard to say with certainty how the Trolls experiment went for Universal. The complete “box office” numbers were never revealed, though most—especially Universal—have declared it a success. It was, at least, profitable, against a production budget of about $90 million. The Wall Street Journal reported that Trolls World Tour made an impressive $95 million in the first three weeks of its digital release, prompting NBCUniversal CEO Jeff Shell to tell the Journal, “The results for Trolls World Tour have exceeded our expectations and demonstrated the viability of PVOD.”

But even with all that info on hand, Mulan—the highly anticipated live-action remake of the beloved 1998 animated film—is the apples to Trolls‘s oranges. At a $200 million budget, it cost more than twice as much to make. Not only is it the most expensive film ever directed by a woman—Niki Caro, known for her Oscar-nominated film Whale Rider—it’s also the most expensive film to skip a theatrical release. For actor Nelson Lee, it was a shock to learn the biggest movie of his career would be opening straight-to-streaming.

“It was a bit of a surprise,” Lee, who plays the role of Emperor’s right-hand man known as The Chancellor, told Decider. “But it made complete sense. I spoke to some of the other cast. We wanted everyone to watch it in theaters, but we never wanted to force people to make a decision about their safety, about this illness. Unfortunately, this pandemic is not going away anytime soon.”

That said, there are places where the COVID-19 numbers have receded. Mulan will be opening in theaters outside of the U.S., including in China. Greenfield stressed the importance of those foreign markets, even as he noted that Disney will “need numbers that far exceed Trolls to make this profitable.”

It will be all but impossible to know if, and how much, money Disney will lose—or make—from Mulan. There are the marketing costs to consider: Disney pushed back the release date several times, a move that most likely cost many millions of dollars. But there’s also the potential profit of new subscribers: If a lot of people sign up for Disney+ to watch Mulan, that’s a new wave of monthly subscription fees in Disney’s pocket for the foreseeable future. Plus, Disney won’t have to split the cost of “ticket” sales with theater owners. Instead, the studio will keep, Greenfield estimates, 80 to 85 percent of each $29.99 unit sold.

But, Greenfield continued, “Even if Mulan is a money-losing exercise for Disney, they’re going to learn a lot from it.”

Chepak summarized exactly what Disney is hoping to learn in the Disney Q3 2020 earnings call in August. “We find it very interesting to be able to take a new offering, our premier access offering, to consumers at that $29.99 price,” he said, “and learn from it—see what happens not only in terms of the uptake of the number of subscribers that we get on the platform, but the actual number of transactions on the Disney+ platform that we get on that PVOD offering.”

Greenfield thinks the only way for non-Disney executives to know if Mulan is a “success” will be to pay attention to the conversation. “Everyone was talking about Hamilton for two weeks straight after it went to Disney+,” he said. “Is Mulan going to have that buzz and excitement?”

That’s where the $30 price tag might be a hindrance. People flocked to Disney+ for Hamilton, but Hamilton was free. They might be less eager to shell out $29.99 for Mulan, especially knowing that Mulan will be free on Disney+ in just a few short months—just yesterday, Disney revealed the film will be available with no additional fee on the service on December 4.

Still, more people are more willing to pay to watch “theatrical” movies at home than you might expect, likely in part because of the extenuating circumstances of being trapped inside in the middle of a global pandemic. A recent survey of 29,638 people conducted by the streaming guide app JustWatch in August found that nearly half of users answered “Yes,” when asked if they would pay $19.99 to a rent a movie online that was supposed to release in theaters.

JustWatch CEO David Croyé told Decider he found this number “surprisingly high.”

“The pie chart you see is based on power users—they go to the cinema a lot and they stream a lot,” Croyé explained in a phone call. He added JustWatch also surveyed the general U.S. population with the same question and found that about 19 percent were still willing to rent movies at that price. Based on this, Croyé thinks Mulan might be one of the few movies that can get away with a $29.99 price tag. “From this 19 percent of the US population, maybe half of them would be willing to pay more,” he said. “Especially if they had two or three kids.”

Another way to measure the success of Mulan is whether Disney opts to release other films intended for theaters in the same way. In the earnings call, Chapek called Mulan a “one-off, as opposed to […] some new, business windowing model we’re looking at.” But say Mulan does well, and TENET—which Warner Bros. forced to theaters this week despite public safety concerns—bombs. It seems hard to believe that, in that scenario, Disney wouldn’t try to push Black Widow, which was supposed to open in theaters in May, to streaming as well.

People interested in the numbers and cash behind Mulan will likely never get the answers they’re seeking. Disney, like Netflix before it, has no incentive to disclose any hard statistics when it comes to Mulan. But it’s hard to deny that this release is a turning point for the industry.

“It feels like the studios have all recognized that in this new world, they’re going to have to move product through windows at a far faster pace than they have historically,” Greenfield said. “It’s hard to believe that you’re ever going to wait 75 days for home video again.”

For many viewers—the ones who couldn’t care less about who’s making money and why—all that matters is having a safe, affordable way to watch the movies they love. That Mulan is Disney’s first major live-action film with an all-Asian cast should not be undervalued. Nor should its universal message of loyalty, bravery, truth, and devotion to family.

“At the end of the day, no matter where you watch this film—be it in a theater, be it on a phone, be it on a screen—I hope everyone takes the central message of this beautiful, ancient story,” Lee said. “It’s the story of a warrior who rises up to protect her family. I think that’s so necessary right now.”

Watch Mulan (2020) on Disney+