Why Disney's latest hit Encanto is bad news for Pixar

Disney's Encanto is a huge hit. Photo / Disney

Do you remember that moment almost 10 years ago when it felt like Disney and Pixar were going to play nice? Six years had passed since the 2006 merger, and the first films the studios had seen through entirely while under the same corporate roof felt like the two had been cutely cribbing from each other's homework. Pixar's was Brave, a princess musical in the grand old Disney tradition, while Walt Disney Animation's was Wreck-It Ralph, a Pixarishly subversive comedy about a video-game villain going straight.

Disney's aim in buying their one-time upstart rivals was to use Pixar's creative daring and technological expertise to reinvigorate their own ailing animation division – a strategy which paid off handsomely, given the films which followed included Moana and the Frozen series.

But since Covid came a-calling, developments suggest the relationship has gone lopsided. It was announced this week that Pixar's latest project, Turning Red, would forgo its planned March cinema run and instead launch directly on the Disney+ streaming service, with no option to view it anywhere else.

It's the third Pixar film in a row to do so after Soul and Luca – and, like those two, it will be available as part of the platform's standard package from day one, rather than kept behind the Premier Access paywall Disney tends to erect around high-profile new releases. Meanwhile, Disney Animation's own two most recent productions, Raya and the Last Dragon and Encanto, both played in cinemas: Raya after the 2021 lockdown eased, and Encanto in November.

The net result – beyond widespread Pixar employee despair, reported in Variety earlier this week – is that the studio which once saved Disney is increasingly looking like some kind of off-brand, B-tier ideas lab, while corporate affection is lavished exclusively on Disney's entirely in-house productions.

From the outside it all looks a bit vendetta-like – not least because Turning Red is being actively kept out of cinemas, rather than merely offered at home as an alternative. On social media, some industry-watchers darkly noted the change of tune came shortly after Pixar's new chief creative officer, Inside Out director Pete Docter, announced a strict (ish) no-franchise policy, following a decade in which the studio's sequels outnumbered their original films by almost two to one. It seems telling that Lightyear, a sort-of prequel to the Toy Story films and the studio's least original new film since the Docter takeover, still seems to be destined for cinemas this June.

So what's afoot? The juiciest conspiracy theory holds that it's out-and-out sabotage: a long-awaited humbling of those cocky Berkeley-based CG parvenus by vengeful Disney loyalists. But that makes little sense. Unlike, say, Blue Sky, the Fox animation house which was disbanded following Disney's 2019 acquisition of that studio, Pixar has a name which promises something very specific to ordinary cinema-goers: innovative storytelling, artistic ingenuity, and perhaps most of all, guaranteed emotional devastation for any adults in the audience. Whether Disney Animation sees them as peers or rivals, there's no sense one studio is treading on the other's toes.

Well, could it be to do with Docter's originality edict, and its damming-up effect on the corporation's ancillary revenue streams? It's certainly true that Pixar's recent output hasn't exactly lent itself to merchandise: Toy Story 4's new character, Forky, was plastic cutlery and Play-Doh, while Soul was about a middle-aged jazz pianist having an existential crisis. Watch those action figures fly off the shelves! But Luca was plenty cute enough for T-shirts and cuddly toys, and Turning Red looks like a marketer's dream: the lead character transforms into a giant fluffy red panda, for goodness sake.

So that leaves one possibility: that brand-new, expensively produced, A-grade animated features are proving such a draw for subscribers on Disney+ that it makes business sense to keep them there – and only there. Like other streaming platforms, Disney+ doesn't make its viewing figures public in any consistent way, but this week's edition of the always-enlightening Ankler newsletter reported that Encanto has been enormous on the service since it was made available on Christmas Eve (its soundtrack is fast becoming the most popular since Frozen).

And despite being a Disney Animation film, Encanto an unmistakably Pixar-esque proposition: no princess, no villain, and no mercy whatsoever as it lands a barrage of emotional haymakers before the closing credits.

The mortal enemy of all streaming platforms is "churn": the customers who cancel their subscriptions because they haven't been convinced it's worth their while to stick around. As Netflix did very successfully before it, Disney+ is in the process of training its subscribers to stay. And if Disney+ is the only place we can see the latest Pixar film, that's a powerful incentive for customers of virtually every type to not delete the direct debit just yet.

As the pandemic finally ebbs, here's an unwelcome feature of the brave new film-watching world: things that are bad for cinema can also be good for business.