Disney Urged to Exit Broadcast Television, Shut Down ABC

Investment firm Needham & Co. last week released a provocative research note recommending that The Walt Disney Company completely shutter its ABC broadcast television network rather than pursue a sale. 

The firm’s analysts argue that exiting the broadcast television business entirely would unlock significant financial benefits for Disney while mitigating the regulatory and operational risks associated with maintaining a traditional network.

Risks of Broadcast Television: Needham’s report points to the recent controversy involving late-night host Jimmy Kimmel as a case study in the vulnerabilities of operating a regulated broadcast network. The “Kimmel-Kirk sequence of events” began with controversial remarks made by Kimmel, which sparked backlash and led to boycotts from some ABC affiliates. This situation escalated quickly, drawing scrutiny from both the public and regulators, and highlighting the challenges Disney faces in managing a network subject to FCC oversight. Needham argues that such incidents underscore the volatility and reputational risks tied to broadcast television, particularly in an era of heightened cultural and political sensitivity.

Financial Case for Shutting Down ABC: The analysts at Needham estimate that closing ABC’s broadcast operations could deliver substantial financial upside for Disney shareholders. Specifically, they project that:

• Shareholder value could increase by approximately $20 billion, driven by the elimination of costly broadcast infrastructure and regulatory burdens.
• Disney’s overall valuation could rise by 10%, reflecting improved investor confidence in a streamlined, forward-looking business model.
• Revenue growth could improve by 40-60 basis points (0.4% to 0.6%), as resources are redirected toward higher-growth segments like streaming.

These projections are rooted in the belief that broadcast television is a declining asset, weighed down by shrinking viewership, high operational costs, and regulatory constraints. 

Needham proposes that Disney could transition ABC’s programming to its streaming services, such as Hulu or a dedicated Disney app, effectively simulcasting content without relying on traditional broadcast affiliates. This approach would allow Disney to maintain its popular programming—such as live sports, news, and entertainment—while bypassing the costly affiliate model and FCC regulations.

The firm emphasizes that streaming platforms are better positioned to capture younger audiences, who increasingly favor on-demand content over linear television.

According to Nielsen’s Gauge report, broadcast television accounted for just 18.5% of total viewership in June 2025—a record low—while streaming platforms commanded a dominant 46% share. These figures underscore the seismic shift in consumer behavior, with viewers gravitating toward flexible, digital-first viewing experiences.