Disney CFO Christine McCarthy has announced that the company will be adopting a concerning new trend in the streaming industry by removing some content from its services and reducing the production of new content in the future.

McCarthy revealed that this decision applies to both Disney+ and Hulu, as Disney holds a 67% majority stake in Hulu. The aim is to ensure that all the content offered on Disney's streaming platforms aligns with their current strategic objectives.

During an earnings call, McCarthy confirmed that Disney will be removing certain content from their streaming platforms and anticipates incurring an impairment charge of around $1.5 to $1.8 billion. This charge, which will not impact the segment results, is expected to be recognized primarily in the third quarter as they finalize the content review and removal process. 
This move follows a similar strategy employed by HBO Max, which received negative feedback from subscribers. McCarthy did not specify which content would be pulled or specify the services affected by the new plan. However, considering Disney+'s status as the primary platform containing major franchises like the Marvel Cinematic Universe and Star Wars, it is likely to be the main focus of Disney's new strategy. Nevertheless, some content from Hulu, which Disney majority owns, may also be at risk of disappearing in the future.

Disney's objective is to streamline the content it produces to cater to consumer preferences. The removed titles are expected to be those that have underperformed compared to the top shows on Disney+ and Hulu. Older titles with low viewership may be among the first to go. By implementing this content removal, Disney aims to maintain only the most profitable TV shows and movies on both platforms.

Additionally, Disney's decision to produce less content aligns with its plan for Phase 5 of the Marvel Cinematic Universe, which involves a decrease in the number of series produced for Disney+ each year. By reducing content production, Disney can allocate more time to ensure the quality of shows and movies, addressing any potential issues that might arise from rushed production. This strategic shift suggests that Disney's focus is on developing a library of high-quality and popular content to satisfy its customers.