1 00:00:01,320 --> 00:00:05,040 Speaker 1: It's been almost a year since Bob Iger, the celebrated 2 00:00:05,120 --> 00:00:09,000 Speaker 1: CEO of the Walt Disney Company, came out of retirement 3 00:00:09,240 --> 00:00:11,840 Speaker 1: and took back his spot at the top of the 4 00:00:12,000 --> 00:00:15,640 Speaker 1: entertainment giant. But the company and the business climate had 5 00:00:15,680 --> 00:00:18,400 Speaker 1: begun to change in the eleven months he was away. 6 00:00:19,040 --> 00:00:22,440 Speaker 1: Disney was no longer a money printing machine. 7 00:00:23,000 --> 00:00:24,960 Speaker 2: When I came back, one of the things I discovered 8 00:00:25,079 --> 00:00:27,560 Speaker 2: was that the disruptive forces that have been preying on 9 00:00:27,640 --> 00:00:29,560 Speaker 2: that business for a while greater than I thought. 10 00:00:30,240 --> 00:00:34,159 Speaker 1: Bloomberg's Thomas Buckley reports that Iger, who was revered for 11 00:00:34,280 --> 00:00:38,160 Speaker 1: his golden touch, is now having a rocky time trying 12 00:00:38,159 --> 00:00:39,200 Speaker 1: to turn things around. 13 00:00:40,000 --> 00:00:43,240 Speaker 3: You have to imagine that he either must truly love 14 00:00:43,280 --> 00:00:46,360 Speaker 3: the company and love the brand to put himself through 15 00:00:46,400 --> 00:00:49,479 Speaker 3: this one more time, potentially at the expense of his legacy, 16 00:00:50,240 --> 00:00:53,800 Speaker 3: or it's simply the case, as sources told me during 17 00:00:53,840 --> 00:00:57,120 Speaker 3: his retirement, that he can't imagine himself doing anything else 18 00:00:57,200 --> 00:01:01,000 Speaker 3: than being the CEO of the Walt Disney Company. 19 00:01:04,800 --> 00:01:08,760 Speaker 1: I'm Westcasova today on the big take. Can Bob Iger 20 00:01:09,000 --> 00:01:20,560 Speaker 1: save Disney again? Tomas? Reading your story, it sure sounds 21 00:01:20,600 --> 00:01:22,639 Speaker 1: like a tough time to be Bob Biker. 22 00:01:23,240 --> 00:01:25,160 Speaker 3: I think it's an incredibly tough time to be Bobbiger. 23 00:01:25,480 --> 00:01:28,440 Speaker 3: It's interesting because there was a period of times, so 24 00:01:28,560 --> 00:01:31,760 Speaker 3: the fifteen years during his first tenure, where it was 25 00:01:31,840 --> 00:01:34,400 Speaker 3: necessarily very easy being Barb Biger. It's a very difficult 26 00:01:34,440 --> 00:01:37,440 Speaker 3: job running the Walt Disney Company, but it certainly came 27 00:01:37,480 --> 00:01:40,360 Speaker 3: with a degree of stature and reverence that I think 28 00:01:40,400 --> 00:01:42,959 Speaker 3: he's really missing in his second tenure, because the Walt 29 00:01:43,000 --> 00:01:46,160 Speaker 3: Disney Company is a very very different company today than 30 00:01:46,200 --> 00:01:49,400 Speaker 3: it was back then. During his first tenure, you know, 31 00:01:49,440 --> 00:01:53,640 Speaker 3: he was celebrated for the acquisitions of Pixar Marvel, which 32 00:01:53,680 --> 00:01:56,000 Speaker 3: is arguably one of the smartest acquisitions in the media 33 00:01:56,120 --> 00:02:00,760 Speaker 3: entertainment history, and today I think think that the company 34 00:02:00,800 --> 00:02:04,840 Speaker 3: is in very very different shape. It has a TV 35 00:02:04,960 --> 00:02:08,240 Speaker 3: division that is suffering from a huge degree of cord cutting. 36 00:02:08,480 --> 00:02:11,000 Speaker 3: Its latest run at the box office over the past 37 00:02:11,040 --> 00:02:15,000 Speaker 3: two years has not been particularly successful. A lot of 38 00:02:15,040 --> 00:02:18,959 Speaker 3: Disney's big budget movies are really underperforming. And then its 39 00:02:19,040 --> 00:02:22,880 Speaker 3: parks business is on paper doing fairly well, based on 40 00:02:22,919 --> 00:02:25,359 Speaker 3: the fact that internationally many of the parks were closed 41 00:02:25,360 --> 00:02:28,680 Speaker 3: this time last year. Domestically, it's really having quite a 42 00:02:28,720 --> 00:02:32,680 Speaker 3: tough time attracting customers based on several price increases that 43 00:02:32,720 --> 00:02:35,720 Speaker 3: were put through by Barbiger's predecessor. On top of all 44 00:02:35,760 --> 00:02:39,920 Speaker 3: of that, when Barbaiker left the company in February twenty twenty, 45 00:02:40,280 --> 00:02:43,760 Speaker 3: just before the onset of a global pandemic, he exited 46 00:02:43,760 --> 00:02:47,480 Speaker 3: the company in December twenty twenty one as executive chairman. 47 00:02:47,800 --> 00:02:50,440 Speaker 3: By that time, Disney's stock price was at about two 48 00:02:50,480 --> 00:02:54,480 Speaker 3: hundred dollars, its market capitalization was well over three hundred 49 00:02:54,520 --> 00:02:59,320 Speaker 3: billion dollars, and coincidentally, you had Netflix's stock that went 50 00:02:59,360 --> 00:03:02,520 Speaker 3: from eight hundred to two hundred when the so called 51 00:03:02,720 --> 00:03:05,560 Speaker 3: streaming bubble burst and Wall Street started caring a lot 52 00:03:05,600 --> 00:03:08,520 Speaker 3: more about the profitability of streaming services than they did 53 00:03:08,520 --> 00:03:11,519 Speaker 3: about subscriber growth at all costs. So he has come 54 00:03:11,600 --> 00:03:14,919 Speaker 3: back to a company that is now trading at about 55 00:03:14,960 --> 00:03:18,720 Speaker 3: its lowest level in a decade. And he had long 56 00:03:18,800 --> 00:03:23,560 Speaker 3: prided himself on consistently outperforming the S and P five 57 00:03:23,639 --> 00:03:28,040 Speaker 3: hundred by great measures during his first tenure, And today 58 00:03:28,160 --> 00:03:30,280 Speaker 3: it turns out if you're a shareholder back when he 59 00:03:30,320 --> 00:03:33,480 Speaker 3: first became CEO in October first, two thousand and five, 60 00:03:34,120 --> 00:03:36,600 Speaker 3: you would be worse of investing in Disney than you 61 00:03:36,600 --> 00:03:38,680 Speaker 3: would have been investing in the S and P. Five hundred. 62 00:03:38,960 --> 00:03:41,560 Speaker 3: So it feels like Wall Street has erased all trace 63 00:03:41,560 --> 00:03:43,040 Speaker 3: of his past Laurels. 64 00:03:44,200 --> 00:03:47,200 Speaker 1: Thomas, Let's go back a little bit to talk about 65 00:03:47,320 --> 00:03:50,800 Speaker 1: how Disney found itself in this place, and maybe a 66 00:03:50,800 --> 00:03:53,680 Speaker 1: good way to start is at that moment when Eiger, 67 00:03:54,000 --> 00:03:57,880 Speaker 1: riding high, decides he's going to step aside and hand 68 00:03:58,000 --> 00:04:00,400 Speaker 1: over the company to his success. 69 00:04:00,760 --> 00:04:05,880 Speaker 3: The moment finally came when he anointed Bob Japek his 70 00:04:06,360 --> 00:04:08,680 Speaker 3: hand picked successor. And this was a moment that had 71 00:04:08,720 --> 00:04:13,160 Speaker 3: been postponed serially during his first tenure. He postponed his 72 00:04:13,240 --> 00:04:17,000 Speaker 3: retirement four times before finally agreeing to step down as. 73 00:04:16,920 --> 00:04:19,960 Speaker 1: See or why did he keep hanging on? 74 00:04:20,839 --> 00:04:23,920 Speaker 3: I think that certainly in his first tenure, being Bob 75 00:04:24,000 --> 00:04:27,120 Speaker 3: Eiger was an absolutely phenomenal gig to have. You know, 76 00:04:27,160 --> 00:04:29,719 Speaker 3: on the one hand, you have your sixty five million 77 00:04:29,760 --> 00:04:33,039 Speaker 3: dollars a year compensation package. On the other hand, you 78 00:04:33,200 --> 00:04:37,880 Speaker 3: have unfettered access to Disney's four corporate jets. You're revered 79 00:04:37,960 --> 00:04:41,799 Speaker 3: in town as one of the most powerful figures in 80 00:04:41,960 --> 00:04:43,960 Speaker 3: all of Hollywood. You know, you have a seat at 81 00:04:43,960 --> 00:04:46,839 Speaker 3: the table that is completely unmatched. You have the ear 82 00:04:47,200 --> 00:04:50,680 Speaker 3: of Spielberg, you have the ear of Jim Cameron. You 83 00:04:50,760 --> 00:04:53,440 Speaker 3: have a fan base you know that is so incredibly 84 00:04:53,440 --> 00:04:56,720 Speaker 3: devoted to the parks that you're able to build a 85 00:04:56,760 --> 00:04:59,240 Speaker 3: growing number of attractions and know that people will always 86 00:04:59,279 --> 00:05:01,440 Speaker 3: show up for them and review you for building them. 87 00:05:01,880 --> 00:05:05,479 Speaker 3: I think that he always knew that he was going 88 00:05:05,520 --> 00:05:08,400 Speaker 3: to have to leave that life at some point, but 89 00:05:08,560 --> 00:05:10,880 Speaker 3: was cognizant of how much he would miss it when 90 00:05:10,920 --> 00:05:13,800 Speaker 3: he did, and so he postponed it four times, to 91 00:05:13,839 --> 00:05:17,320 Speaker 3: the extent which colleagues of his ended up gifting him 92 00:05:17,680 --> 00:05:21,080 Speaker 3: custom made license plate in jest, asking is their life 93 00:05:21,120 --> 00:05:22,400 Speaker 3: after Disney. 94 00:05:22,680 --> 00:05:25,800 Speaker 1: And what happened then when he ultimately did decide to 95 00:05:25,960 --> 00:05:27,520 Speaker 1: hand over the company. 96 00:05:28,160 --> 00:05:30,600 Speaker 3: If you look at it from a shareholder perspective, Bob 97 00:05:30,680 --> 00:05:33,520 Speaker 3: Chapek is somewhat of an obvious choice in that he's 98 00:05:33,560 --> 00:05:36,919 Speaker 3: delivered outsize performance at the park's business that used to run. 99 00:05:37,320 --> 00:05:39,680 Speaker 3: He did a phenomenal job in consumer products before that, 100 00:05:39,839 --> 00:05:43,320 Speaker 3: a phenomenal job in home video, and what Eiger has 101 00:05:43,360 --> 00:05:48,080 Speaker 3: been telling his friends and confidants is that he mistook 102 00:05:48,279 --> 00:05:53,159 Speaker 3: those operational chops for leadership qualities. Critics of that assessment 103 00:05:53,200 --> 00:05:56,520 Speaker 3: say that actually, Bobigan knew exactly the kind of person 104 00:05:56,600 --> 00:05:59,360 Speaker 3: and the kind of businessman that Bob Shapeck was, and 105 00:05:59,600 --> 00:06:02,960 Speaker 3: he knew knew that Bob Jaypeck posts absolutely no risk 106 00:06:03,080 --> 00:06:08,040 Speaker 3: outshining him, outshining his legacy when Bob Jaypek set about 107 00:06:08,240 --> 00:06:11,920 Speaker 3: running Disney as he saw fit, which was to basically 108 00:06:11,960 --> 00:06:16,360 Speaker 3: transform the company into a sprawling data aggregator, wherein he 109 00:06:16,360 --> 00:06:19,640 Speaker 3: would track viewing habits of his customers at home on 110 00:06:19,680 --> 00:06:22,359 Speaker 3: Disney Pluss, and he would track spending habits of his 111 00:06:22,440 --> 00:06:24,719 Speaker 3: customers in the parks, you know, so as to better 112 00:06:24,760 --> 00:06:29,080 Speaker 3: market discounts and spending opportunities to them. I think that 113 00:06:29,279 --> 00:06:32,640 Speaker 3: Bob Byger saw a real risk that the vision that 114 00:06:32,680 --> 00:06:36,159 Speaker 3: Bob Jaypeck had would devalue the Disney brand. He was 115 00:06:36,279 --> 00:06:40,240 Speaker 3: also very cognizant of some of the riffs that were 116 00:06:40,240 --> 00:06:44,680 Speaker 3: being created across Hollywood, certainly with Scarlett Jansen when Bob 117 00:06:44,760 --> 00:06:47,320 Speaker 3: Japek disclosed her salary and a dispute over a film 118 00:06:47,360 --> 00:06:49,560 Speaker 3: that she was involved with called Black Widow. Some of 119 00:06:49,560 --> 00:06:51,920 Speaker 3: the fans had started to rebel against what they saw 120 00:06:51,960 --> 00:06:54,680 Speaker 3: as being nickel and dimed in the parks. So it 121 00:06:54,800 --> 00:06:58,560 Speaker 3: used to be that. Bob Bieger during his first tenure, certainly, 122 00:06:58,600 --> 00:07:01,280 Speaker 3: and we've seen this as well in his second, values 123 00:07:01,320 --> 00:07:05,599 Speaker 3: the works of creatives immensely, and when Bob Japek restructured 124 00:07:05,600 --> 00:07:08,919 Speaker 3: the company, many critics of that restructuring argued that it 125 00:07:09,000 --> 00:07:13,280 Speaker 3: actually removed power from creative executives, and so the people 126 00:07:13,400 --> 00:07:16,600 Speaker 3: running those film and TV businesses felt as though they 127 00:07:16,600 --> 00:07:20,680 Speaker 3: were completely disenfranchised, completely disempowered at a time when they 128 00:07:20,720 --> 00:07:23,800 Speaker 3: were seeking to create new franchises for the business released 129 00:07:23,840 --> 00:07:27,120 Speaker 3: new blockbusters both in theaters and on streaming. 130 00:07:28,040 --> 00:07:31,840 Speaker 1: Thomas ultimately, though, it wasn't just the stylistic differences from 131 00:07:31,880 --> 00:07:35,600 Speaker 1: the way things were done before that made life impossible 132 00:07:35,720 --> 00:07:36,679 Speaker 1: for Bob Japek. 133 00:07:37,320 --> 00:07:39,600 Speaker 3: Absolutely. I think there are a couple of, you know, 134 00:07:39,840 --> 00:07:43,920 Speaker 3: moments in time that really point to a question of gosh, 135 00:07:43,920 --> 00:07:47,040 Speaker 3: you know, what is happening at Disney. Certainly one of 136 00:07:47,080 --> 00:07:52,240 Speaker 3: them is when Florida Governor run Desentis drafted a bill 137 00:07:52,400 --> 00:07:54,360 Speaker 3: informally known as the Don't Say Gay Bill that would 138 00:07:54,360 --> 00:07:58,440 Speaker 3: prevent teachers from discussing sexual orientation with students in Florida schools. 139 00:07:58,720 --> 00:08:03,239 Speaker 3: A huge number of Disney employees really insisted that Disney 140 00:08:03,320 --> 00:08:07,040 Speaker 3: come out and condemn that bill. Japek refused to condemn 141 00:08:07,120 --> 00:08:10,960 Speaker 3: the bill initially, which led to wark counts, and then 142 00:08:11,080 --> 00:08:12,480 Speaker 3: he publicly did condemn it. 143 00:08:12,720 --> 00:08:16,360 Speaker 4: I called Governor desantiasis morning to express our disappointment and 144 00:08:16,480 --> 00:08:20,280 Speaker 4: concern that if legislation becomes law, it could be used 145 00:08:20,600 --> 00:08:25,320 Speaker 4: to unfairly target gay, lesbian, non binary and transgender kids 146 00:08:25,320 --> 00:08:26,600 Speaker 4: and families. 147 00:08:26,680 --> 00:08:30,520 Speaker 3: Which led to a high profile war with descentis that 148 00:08:30,600 --> 00:08:33,400 Speaker 3: is ongoing to this day, both the company and the 149 00:08:33,440 --> 00:08:37,760 Speaker 3: Governor that are embroad in illegal battle that shows no 150 00:08:37,920 --> 00:08:41,240 Speaker 3: signs of winding down anytime soon. The second test of 151 00:08:41,280 --> 00:08:45,240 Speaker 3: his leadership is his devotion to growing streaming subscribers at 152 00:08:45,280 --> 00:08:47,760 Speaker 3: a time when Wall Street was really favoring that. It 153 00:08:47,800 --> 00:08:51,840 Speaker 3: was favoring unbridled growth over profitability. I suppose the past 154 00:08:52,000 --> 00:08:54,839 Speaker 3: year or so, a number of banks, in fact, all 155 00:08:54,840 --> 00:08:59,760 Speaker 3: banks are much more focused on the profitable growth of 156 00:08:59,800 --> 00:09:05,280 Speaker 3: those streaming services versus just attracting subscriber numbers. When Chapek 157 00:09:05,360 --> 00:09:09,760 Speaker 3: disclosed back in November of last year a one point 158 00:09:09,800 --> 00:09:13,520 Speaker 3: four to seven billion dollar loss in Disney's streaming service, 159 00:09:14,320 --> 00:09:17,960 Speaker 3: it caught Wall Street entirely by surprise. It sent the 160 00:09:18,000 --> 00:09:22,560 Speaker 3: shares down by the most in years and ultimately made 161 00:09:22,679 --> 00:09:28,839 Speaker 3: Chapex's vision for the company untenable. After that enormous loss 162 00:09:28,840 --> 00:09:32,240 Speaker 3: in the market value of the company, the board convened 163 00:09:32,360 --> 00:09:35,360 Speaker 3: and decided that the company should really be run by 164 00:09:35,360 --> 00:09:37,800 Speaker 3: somebody who would be able to return it to its 165 00:09:37,840 --> 00:09:41,800 Speaker 3: past form. And I suppose the issue critics would say 166 00:09:41,800 --> 00:09:44,120 Speaker 3: with the board is that none of the members really 167 00:09:44,200 --> 00:09:47,200 Speaker 3: have experience in media entertainment, so the only person they 168 00:09:47,200 --> 00:09:50,640 Speaker 3: could think to return to the company's helm was the Baiger. 169 00:09:52,200 --> 00:09:56,280 Speaker 1: When we come back, Eiger returns triumphant, but the cheers 170 00:09:56,720 --> 00:10:07,439 Speaker 1: don't last long. Thomas, I don't think anyone who was 171 00:10:07,480 --> 00:10:10,520 Speaker 1: close to Eiger was at all surprised that he came 172 00:10:10,600 --> 00:10:11,560 Speaker 1: back to the company. 173 00:10:11,559 --> 00:10:13,600 Speaker 3: Then, I think that's a great way of putting it. 174 00:10:13,640 --> 00:10:16,000 Speaker 3: I mean, certainly, not only because everybody got a heads 175 00:10:16,040 --> 00:10:18,880 Speaker 3: up before he took the job back, but also because 176 00:10:19,120 --> 00:10:23,120 Speaker 3: he hadn't been telling his friends and confidence and honestly 177 00:10:23,160 --> 00:10:26,480 Speaker 3: some of Hollywod's most important figures. He feared that Jaypek 178 00:10:26,920 --> 00:10:30,640 Speaker 3: was squandering the company's soul. He had suggested that Bob 179 00:10:30,720 --> 00:10:33,440 Speaker 3: Chaypek was not the right fit for that role, and 180 00:10:33,440 --> 00:10:35,480 Speaker 3: then the question became well, who would be the right 181 00:10:35,480 --> 00:10:38,000 Speaker 3: fit for that role, and I think that Bobb Iger 182 00:10:38,400 --> 00:10:41,400 Speaker 3: sincerely believes that he is the best possible fit for 183 00:10:41,559 --> 00:10:43,400 Speaker 3: that role at this point in time. 184 00:10:44,040 --> 00:10:47,439 Speaker 1: Thomas, What did Bob Chapek have to say about all 185 00:10:47,480 --> 00:10:47,680 Speaker 1: of this? 186 00:10:48,640 --> 00:10:51,800 Speaker 3: Bob Chaypek has declined to comment on every item in 187 00:10:51,840 --> 00:10:55,320 Speaker 3: our story that concerns him, that concerns the company, that 188 00:10:55,400 --> 00:10:59,960 Speaker 3: concerns Bob Iger's return, and I haven't seen him quote 189 00:11:00,480 --> 00:11:03,120 Speaker 3: or interviewed anywhere else. So I think that since leaving 190 00:11:03,160 --> 00:11:06,160 Speaker 3: Disney in November of last year, he has stayed very 191 00:11:06,240 --> 00:11:09,120 Speaker 3: quiet on this whole state of affairs. When I Go 192 00:11:09,280 --> 00:11:13,320 Speaker 3: returned to the company, he was very vocal that Shapek's 193 00:11:13,360 --> 00:11:17,200 Speaker 3: silence on don't say gay was a matter of right 194 00:11:17,280 --> 00:11:21,560 Speaker 3: or wrong. I think that that certainly ranklled Shapek to 195 00:11:21,640 --> 00:11:24,280 Speaker 3: an enormous degree. I think that he felt as though 196 00:11:24,320 --> 00:11:26,160 Speaker 3: he didn't need to be coached from the sidelines. 197 00:11:27,080 --> 00:11:29,960 Speaker 1: Broadly. What was the reaction to the news that Eiger 198 00:11:30,160 --> 00:11:31,600 Speaker 1: was returning to Disney. 199 00:11:32,280 --> 00:11:34,640 Speaker 3: Well, it's interesting because while it wouldn't have been a 200 00:11:34,720 --> 00:11:37,680 Speaker 3: surprise to his friends and confidants, who really had a 201 00:11:37,720 --> 00:11:41,120 Speaker 3: sense that he wanted his job back, to outsiders, looking in. 202 00:11:41,400 --> 00:11:43,640 Speaker 3: It really felt like an episode of succession. And I 203 00:11:43,640 --> 00:11:48,319 Speaker 3: think there was enormous elation across the Disney employee base 204 00:11:48,640 --> 00:11:51,400 Speaker 3: because at that point in time, there was no inkling 205 00:11:51,400 --> 00:11:53,520 Speaker 3: of the fact that Barbiger would be carrying out seven 206 00:11:53,600 --> 00:11:56,960 Speaker 3: thousand job cuts across the company. So when his return 207 00:11:57,120 --> 00:11:59,280 Speaker 3: was first announced, which I think was in an email 208 00:11:59,440 --> 00:12:02,679 Speaker 3: to employee at nine forty two pm in late November, 209 00:12:03,080 --> 00:12:06,840 Speaker 3: it was a state of unbridled joy. I mean, I 210 00:12:07,000 --> 00:12:10,280 Speaker 3: have heard from sources familiar that employees already at their 211 00:12:10,280 --> 00:12:14,559 Speaker 3: desks in Asia leapt for joy. And so one indication 212 00:12:15,040 --> 00:12:18,560 Speaker 3: that came very quickly after Eiger's return was that Disney 213 00:12:18,640 --> 00:12:21,760 Speaker 3: has a private island that it owns in the Bahamas 214 00:12:21,800 --> 00:12:25,360 Speaker 3: called Castawiki. A sign on the pump house there that 215 00:12:25,880 --> 00:12:31,520 Speaker 3: had been painted with Bob Chapek Mastershipbuilder was quickly replaced 216 00:12:31,520 --> 00:12:34,440 Speaker 3: and painted over by one with Bob Ayger's name. 217 00:12:36,520 --> 00:12:40,480 Speaker 1: So Igery does return to the company and where did 218 00:12:40,520 --> 00:12:41,080 Speaker 1: he find? 219 00:12:41,960 --> 00:12:44,120 Speaker 3: I got returned to the company in November of last 220 00:12:44,200 --> 00:12:48,320 Speaker 3: year and says that he found a company in much 221 00:12:48,360 --> 00:12:50,880 Speaker 3: worse shape than he'd imagined it would be in I 222 00:12:50,920 --> 00:12:54,160 Speaker 3: think that's difficult for a number of critics and observers 223 00:12:54,160 --> 00:12:56,600 Speaker 3: to believe because he was only out of the business 224 00:12:56,600 --> 00:12:59,800 Speaker 3: for eleven months, and also he has probably the most 225 00:13:00,120 --> 00:13:04,640 Speaker 3: formed opinion of anybody on Disney's prowess in the industry 226 00:13:04,640 --> 00:13:07,560 Speaker 3: and in the business world. Nonetheless, he says that he 227 00:13:07,720 --> 00:13:10,760 Speaker 3: was really taken aback by the speed at which the 228 00:13:10,840 --> 00:13:14,920 Speaker 3: linear TV business is collapsing. I think what's important to 229 00:13:14,960 --> 00:13:21,000 Speaker 3: remember here is that those linear networks, which include ABC, ESPN, FX, 230 00:13:21,280 --> 00:13:25,479 Speaker 3: free Form and National Geographic, before the pandemic, they contributed 231 00:13:25,720 --> 00:13:29,400 Speaker 3: about a third of Disney's revenue and about half of 232 00:13:29,440 --> 00:13:34,320 Speaker 3: its profit. He says that he's been surprised at the 233 00:13:34,320 --> 00:13:37,160 Speaker 3: speed at which they're collapsing. And this is a pretty 234 00:13:37,200 --> 00:13:39,840 Speaker 3: important point really in the widest state of Disney, because 235 00:13:39,880 --> 00:13:43,040 Speaker 3: the wider state of Disney is the result of a 236 00:13:43,440 --> 00:13:46,320 Speaker 3: huge deal that Bobaya carried out in the twilight of 237 00:13:46,320 --> 00:13:49,640 Speaker 3: his tenure, which was the acquisition of twenty first century 238 00:13:49,640 --> 00:13:52,560 Speaker 3: Fox for seventy one point three billion dollars. And with 239 00:13:52,640 --> 00:13:56,400 Speaker 3: that acquisition he gained a number of networks, including FX 240 00:13:56,720 --> 00:13:59,800 Speaker 3: and National Geographic, that are today contributing to that profit 241 00:13:59,840 --> 00:14:03,200 Speaker 3: the line despite the deal only being four years old, 242 00:14:03,240 --> 00:14:05,280 Speaker 3: and thus relatively fresh. 243 00:14:05,400 --> 00:14:08,600 Speaker 1: So what is Eigernow doing to turn things around at 244 00:14:08,600 --> 00:14:09,079 Speaker 1: the company? 245 00:14:09,640 --> 00:14:12,040 Speaker 3: I think that Bob's priority, certainly in the short term, 246 00:14:12,160 --> 00:14:15,359 Speaker 3: is appeasing Wall Street as best he can and convincing 247 00:14:15,600 --> 00:14:18,560 Speaker 3: investors and analysts that the company can be the growth 248 00:14:18,559 --> 00:14:21,520 Speaker 3: engine that it once was. He has pledged to cut 249 00:14:21,680 --> 00:14:24,680 Speaker 3: five point five billion dollars out of the company's annual costs, 250 00:14:24,720 --> 00:14:27,240 Speaker 3: and the company is set to exceed that. As I mentioned, 251 00:14:27,280 --> 00:14:31,120 Speaker 3: he's moving forward with thousands of layoffs, and he has 252 00:14:31,200 --> 00:14:34,360 Speaker 3: pledged to reinstate a modest dividend at the end of 253 00:14:34,360 --> 00:14:38,880 Speaker 3: the fiscal year. So I think that in the short 254 00:14:38,960 --> 00:14:40,840 Speaker 3: term that that is what he's trying to do. He's 255 00:14:40,880 --> 00:14:43,760 Speaker 3: trying to gain the confidence of investors back, even though 256 00:14:43,840 --> 00:14:46,720 Speaker 3: shares today are low than they were than when Chapek 257 00:14:46,840 --> 00:14:49,880 Speaker 3: was ousted from the company. And he's also moved to 258 00:14:49,920 --> 00:14:54,000 Speaker 3: restore authority to the creatives who had felt marginalize under 259 00:14:54,040 --> 00:14:58,640 Speaker 3: Chapec's tenure. So he pretty much disbanded the structure that 260 00:14:58,720 --> 00:15:01,960 Speaker 3: Chapepek had set up and reformulated the company around three 261 00:15:01,960 --> 00:15:05,840 Speaker 3: pillars Disney Entertainment, which is run by its head of 262 00:15:05,880 --> 00:15:08,200 Speaker 3: TV and its head of Film and they have combined 263 00:15:08,240 --> 00:15:12,440 Speaker 3: oversight over streaming than Disney Parks, experiences and products. And 264 00:15:12,480 --> 00:15:15,800 Speaker 3: he's also broken out ESPN, which is very interesting. We're 265 00:15:15,800 --> 00:15:17,720 Speaker 3: going to be getting access to those financials for the 266 00:15:17,720 --> 00:15:18,880 Speaker 3: first time next month. 267 00:15:19,840 --> 00:15:22,960 Speaker 1: One other thing with ESPN that's been a little controversial 268 00:15:23,160 --> 00:15:25,880 Speaker 1: is that they're getting into sports betting. 269 00:15:26,600 --> 00:15:30,280 Speaker 3: Absolutely so, I think that something that Bob had been 270 00:15:30,880 --> 00:15:34,880 Speaker 3: incredibly reluctant to consider during his first tenure was involving 271 00:15:35,240 --> 00:15:38,920 Speaker 3: ESPN in any sorts of sports betting due to the 272 00:15:38,960 --> 00:15:42,520 Speaker 3: reputational concerns and the reputational impact that it would have 273 00:15:42,640 --> 00:15:47,240 Speaker 3: on the Disney brand. He's been much more amenable in 274 00:15:47,360 --> 00:15:51,000 Speaker 3: recent years to quickly plug holes at a time when 275 00:15:51,480 --> 00:15:55,680 Speaker 3: ESPN's linear business is certainly under a tremendous amount of pressure. 276 00:15:57,640 --> 00:16:02,520 Speaker 1: And Thomas, you also right that one of Disney's fable divisions, 277 00:16:02,560 --> 00:16:06,320 Speaker 1: its movie division, is also under a lodder pressure, and 278 00:16:06,360 --> 00:16:09,320 Speaker 1: he's making moves to cut costs there too. 279 00:16:09,480 --> 00:16:12,280 Speaker 3: The film division at Disney is one of the world's 280 00:16:12,320 --> 00:16:16,280 Speaker 3: most successful historically, if not the most successful. For example, 281 00:16:16,280 --> 00:16:18,960 Speaker 3: of the Guardians three film that grows close to a 282 00:16:19,000 --> 00:16:19,760 Speaker 3: billion dollars. 283 00:16:20,640 --> 00:16:25,240 Speaker 5: Someday, I'm gonna make great machines that fly, and me 284 00:16:25,320 --> 00:16:28,800 Speaker 5: and my friends are gonna go flying together into the 285 00:16:28,840 --> 00:16:30,840 Speaker 5: forever and beautiful sky. 286 00:16:32,240 --> 00:16:36,080 Speaker 3: Lilah the second Avatar film from Jim Cameron that is 287 00:16:36,120 --> 00:16:37,960 Speaker 3: now the third highest grossing film in history. 288 00:16:38,800 --> 00:16:39,720 Speaker 2: So what does her heart be? 289 00:16:39,840 --> 00:16:40,320 Speaker 5: Sound like? 290 00:16:48,000 --> 00:16:48,360 Speaker 1: Mighty? 291 00:16:50,160 --> 00:16:54,040 Speaker 3: There are spots of prowess and brightness within the film division, 292 00:16:54,160 --> 00:16:58,400 Speaker 3: but the majority of Disney's big budget releases have really 293 00:16:58,760 --> 00:17:02,480 Speaker 3: really struggled in recently. For example, light Year, a Toy 294 00:17:02,560 --> 00:17:05,159 Speaker 3: Story prequel, which is very difficult to believe given the 295 00:17:05,200 --> 00:17:07,720 Speaker 3: affinity that people have for that franchise and that people 296 00:17:07,800 --> 00:17:10,840 Speaker 3: used to have for Pixar in general. A number of 297 00:17:10,880 --> 00:17:14,879 Speaker 3: film goers are also increasingly fatigued by the number of 298 00:17:15,000 --> 00:17:19,160 Speaker 3: superhero pictures and TV shows out there that relates specifically 299 00:17:19,200 --> 00:17:21,680 Speaker 3: to the latest and manner wat film, and has led 300 00:17:21,720 --> 00:17:24,560 Speaker 3: Eiger to say publicly that he's questioning the need for 301 00:17:24,640 --> 00:17:27,520 Speaker 3: any second or third film based on any one character, 302 00:17:28,000 --> 00:17:30,560 Speaker 3: and he's seeking to very much refresh the Marvel slate 303 00:17:31,040 --> 00:17:33,600 Speaker 3: in order to fix some of those creative problems. He 304 00:17:33,760 --> 00:17:36,800 Speaker 3: has delayed disney slate of films by as long as 305 00:17:36,800 --> 00:17:38,920 Speaker 3: three years, pushing some films back all the way to 306 00:17:38,960 --> 00:17:41,720 Speaker 3: twenty thirty one, so I think that you can see 307 00:17:41,760 --> 00:17:44,800 Speaker 3: he's seeking to take action now in order to be 308 00:17:44,840 --> 00:17:48,160 Speaker 3: at a much better place five years from now. Nonetheless, 309 00:17:48,240 --> 00:17:51,720 Speaker 3: because that development, production, and release pirit is so long, 310 00:17:51,760 --> 00:17:53,920 Speaker 3: you could certainly argue that some of those problems were 311 00:17:53,920 --> 00:17:56,639 Speaker 3: festering before he even left the company the first time around. 312 00:17:57,320 --> 00:18:01,320 Speaker 1: You've talked about how Eiger has been admired by creatives, 313 00:18:01,400 --> 00:18:05,640 Speaker 1: people who actually make things instead of just executives and accountants, 314 00:18:05,920 --> 00:18:09,200 Speaker 1: and yet during the recent Hollywood strike he came off 315 00:18:09,240 --> 00:18:11,399 Speaker 1: as something almost like a villain. 316 00:18:12,040 --> 00:18:14,600 Speaker 3: That's absolutely right. I mean, it's really interesting because he 317 00:18:14,880 --> 00:18:18,240 Speaker 3: was long held as a champion for creators, and I 318 00:18:18,280 --> 00:18:20,840 Speaker 3: think that the degree to which he empowered those creatives 319 00:18:20,880 --> 00:18:23,600 Speaker 3: during his first tenure, and the degree to which he's 320 00:18:23,640 --> 00:18:26,840 Speaker 3: now restructured the company since his comeback, handing authority back 321 00:18:26,880 --> 00:18:29,920 Speaker 3: to creatives really speaks to that affinity that he has 322 00:18:30,040 --> 00:18:32,800 Speaker 3: for the creative process and for the people leading it. 323 00:18:33,440 --> 00:18:36,280 Speaker 3: He gave an interview to CNBC in which he said 324 00:18:36,480 --> 00:18:40,640 Speaker 3: that the requests of some actors and writers, the very 325 00:18:40,840 --> 00:18:44,080 Speaker 3: creative community he's always sought to empower, those requests were 326 00:18:44,119 --> 00:18:45,480 Speaker 3: simply unrealistic. 327 00:18:45,880 --> 00:18:49,199 Speaker 2: The expectation that they have that is just not realistic, 328 00:18:49,520 --> 00:18:52,600 Speaker 2: and they are adding to a set of challenges that 329 00:18:52,680 --> 00:18:56,720 Speaker 2: this business is already facing that is quite frankly, very disruptive. 330 00:18:58,080 --> 00:18:58,880 Speaker 2: I know they're. 331 00:18:58,640 --> 00:19:02,840 Speaker 3: Not number of people have since attacked him for those 332 00:19:02,880 --> 00:19:06,720 Speaker 3: comments online. Certainly the head of the Actors' Union said 333 00:19:06,720 --> 00:19:10,480 Speaker 3: that Barbiega was completely out of touch and in effect 334 00:19:10,480 --> 00:19:13,080 Speaker 3: said that Disney should muzzle him and never allow him 335 00:19:13,119 --> 00:19:14,520 Speaker 3: to speak on these issues again. 336 00:19:15,280 --> 00:19:18,760 Speaker 6: There he is sitting in his designer clothes, just go 337 00:19:19,040 --> 00:19:24,119 Speaker 6: up his private jet at the billionaire's camp, telling us 338 00:19:24,760 --> 00:19:29,879 Speaker 6: where unrealistic when he's making seventy eight thousand dollars a day. 339 00:19:31,000 --> 00:19:34,320 Speaker 1: That, of course is fran Dresher. She's the Actors' union 340 00:19:34,440 --> 00:19:37,719 Speaker 1: president who led the TV and movie actors strike. 341 00:19:39,280 --> 00:19:42,000 Speaker 3: He has been held up as the villain ever since 342 00:19:42,080 --> 00:19:45,840 Speaker 3: those comments in the wider Hollywood creative community. But I 343 00:19:45,920 --> 00:19:47,960 Speaker 3: think that he's trying his very best now to find 344 00:19:48,040 --> 00:19:53,040 Speaker 3: resolution and seeking to get the creative community back to work, 345 00:19:53,200 --> 00:19:56,000 Speaker 3: largely by offering much of what it was that they 346 00:19:56,000 --> 00:19:57,520 Speaker 3: were seeking in the first place. 347 00:19:58,760 --> 00:20:01,919 Speaker 1: After the break, Will there so called house of Mouse 348 00:20:02,359 --> 00:20:14,560 Speaker 1: remain under one roof What does this company under Bob 349 00:20:14,680 --> 00:20:19,520 Speaker 1: Eiger or his ultimate successor look like five years from now. 350 00:20:20,440 --> 00:20:23,639 Speaker 3: Well, it's very interesting. I think that certainly what he 351 00:20:23,720 --> 00:20:27,160 Speaker 3: said publicly that the linear networks may not be caught 352 00:20:27,160 --> 00:20:30,480 Speaker 3: of the company's future really suggests that the likes of 353 00:20:30,520 --> 00:20:35,879 Speaker 3: ABC FX, free Form, ESPN even will be somehow spun 354 00:20:35,920 --> 00:20:40,040 Speaker 3: off and won't be included in Disney's future going forward. 355 00:20:40,560 --> 00:20:43,520 Speaker 3: He's also said that he's seeking a partner for the 356 00:20:43,760 --> 00:20:47,600 Speaker 3: ESPN business. You're looking at potentially selling a minority stake 357 00:20:47,600 --> 00:20:50,040 Speaker 3: in that business or forming a joint venture in order 358 00:20:50,080 --> 00:20:53,000 Speaker 3: to help its transition to streaming. So I think the 359 00:20:53,080 --> 00:20:55,080 Speaker 3: interesting question, and this has been put to me by 360 00:20:55,200 --> 00:20:58,560 Speaker 3: sources familiar with the matter, is whether Bob's end game 361 00:20:59,000 --> 00:21:03,320 Speaker 3: is ultimately Disney up into two separate companies, one to 362 00:21:03,400 --> 00:21:06,600 Speaker 3: house all of its intellectual properties, so it's films and 363 00:21:06,680 --> 00:21:10,960 Speaker 3: TV shows and streaming assets, and the other to run 364 00:21:11,000 --> 00:21:14,760 Speaker 3: its parks business. The thought of Disney splitting up its 365 00:21:14,800 --> 00:21:18,560 Speaker 3: crown jeols is very difficult to process, but nonetheless it 366 00:21:18,600 --> 00:21:22,240 Speaker 3: can be done quite efficiently if you establish a permanent 367 00:21:22,320 --> 00:21:25,920 Speaker 3: licensing agreement between the two properties. And then the question 368 00:21:26,040 --> 00:21:29,720 Speaker 3: becomes what happens to that content business? Do the two 369 00:21:29,720 --> 00:21:33,840 Speaker 3: companies operate independently and publicly forevermore, or is the content 370 00:21:33,920 --> 00:21:37,480 Speaker 3: piece of it acquired by a larger tech platform that 371 00:21:37,600 --> 00:21:41,560 Speaker 3: is seeking to very rapidly grow its subscription business. Many 372 00:21:41,600 --> 00:21:46,520 Speaker 3: sources that I've spoken to for this story have consistently 373 00:21:46,920 --> 00:21:50,520 Speaker 3: insisted that Bob's endgame is selling that piece of the 374 00:21:50,560 --> 00:21:55,119 Speaker 3: company to Apple. Bob served for a number of years, 375 00:21:55,160 --> 00:21:58,760 Speaker 3: almost a decade on the board of Apple. He suggested 376 00:21:58,880 --> 00:22:02,159 Speaker 3: himself in his memo that had his very good and 377 00:22:02,200 --> 00:22:06,320 Speaker 3: successful friend Steve Jobs still been alive today, he definitely 378 00:22:06,359 --> 00:22:10,280 Speaker 3: would have seen a possibility of merging Apple with Disney, 379 00:22:10,400 --> 00:22:12,720 Speaker 3: or at the very least discussing the proposal. 380 00:22:13,800 --> 00:22:16,840 Speaker 1: And you write in your story that Eiger may or 381 00:22:16,920 --> 00:22:20,840 Speaker 1: may not have given sort of a tantalizing clue about 382 00:22:20,880 --> 00:22:24,879 Speaker 1: his desire to see Apple in Disney in talks. 383 00:22:25,560 --> 00:22:28,800 Speaker 3: So this has been the subject of much speculation among 384 00:22:28,800 --> 00:22:32,080 Speaker 3: the Disney executives that I speak to. Physical copies of 385 00:22:32,440 --> 00:22:37,600 Speaker 3: Steve Jobs's collection of Memoirs and Speeches that was published 386 00:22:37,720 --> 00:22:41,960 Speaker 3: in April was distributed to about thirty thousand Disney employees. 387 00:22:42,280 --> 00:22:45,560 Speaker 3: The inside joke within some executives of the company on 388 00:22:45,640 --> 00:22:48,359 Speaker 3: the day that they received the gift was you know, gosh? 389 00:22:48,520 --> 00:22:51,240 Speaker 3: Is he subtly hinting at talks that could be to 390 00:22:51,280 --> 00:22:53,760 Speaker 3: come or talks that are happening now that would see 391 00:22:53,920 --> 00:22:55,560 Speaker 3: Disney folded into Apple. 392 00:22:56,440 --> 00:22:59,600 Speaker 1: What if anything, as Apple said about this idea of 393 00:22:59,720 --> 00:23:02,880 Speaker 1: disee Disney and Apple becoming partners. 394 00:23:03,520 --> 00:23:06,959 Speaker 3: Apple has never commented publicly on the prospects of an 395 00:23:07,040 --> 00:23:10,920 Speaker 3: acquisition of Disney or any acquisition for that matter. Apple's 396 00:23:10,960 --> 00:23:15,159 Speaker 3: business model is not at all predicated on a merger 397 00:23:15,160 --> 00:23:17,959 Speaker 3: and acquisition strategy, which is very interesting. I mean, its 398 00:23:18,040 --> 00:23:21,200 Speaker 3: largest acquisition to date has been beat to the tune 399 00:23:21,240 --> 00:23:25,440 Speaker 3: of three billion dollars. This would really be a multiple 400 00:23:25,720 --> 00:23:28,240 Speaker 3: of that, and I think that there would certainly be 401 00:23:28,280 --> 00:23:32,040 Speaker 3: a number of cultural integration concerns that the two companies 402 00:23:32,040 --> 00:23:35,639 Speaker 3: would have to address. But I think that much of 403 00:23:35,680 --> 00:23:40,480 Speaker 3: this speculation is more emanating from Eiger's desire to see 404 00:23:40,600 --> 00:23:44,440 Speaker 3: these two companies ultimately matched than it is from any 405 00:23:44,480 --> 00:23:47,720 Speaker 3: strategy that Apple has communicated to either its investors or 406 00:23:47,760 --> 00:23:50,119 Speaker 3: its followers in TAMAS. 407 00:23:50,119 --> 00:23:52,720 Speaker 1: What is Bob Iger said about your reporting? 408 00:23:53,320 --> 00:23:56,080 Speaker 3: Disney has declined to grant me an interview with Bob 409 00:23:56,119 --> 00:23:58,320 Speaker 3: and it's not for lack of trying over the past 410 00:23:58,359 --> 00:24:00,560 Speaker 3: several months in order to be fair to him and 411 00:24:00,600 --> 00:24:03,080 Speaker 3: fed to the company, but he has only done a 412 00:24:03,119 --> 00:24:05,439 Speaker 3: handful of interviews since his return. 413 00:24:06,359 --> 00:24:10,000 Speaker 1: What happens next for Bob Iger and Disney. 414 00:24:10,600 --> 00:24:13,320 Speaker 3: I think that certainly, when he came back, you know, 415 00:24:13,560 --> 00:24:16,240 Speaker 3: both he and the board stated publicly that he had 416 00:24:16,240 --> 00:24:19,160 Speaker 3: come back to both reset the company in the right 417 00:24:19,200 --> 00:24:23,440 Speaker 3: direction and figure out Disney's perennial succession problem. He was 418 00:24:23,520 --> 00:24:25,720 Speaker 3: given a contract of two years with Whin to fix 419 00:24:25,760 --> 00:24:29,639 Speaker 3: those issues. Back in July, the board extended his contract 420 00:24:29,840 --> 00:24:33,120 Speaker 3: all the way through twenty twenty six. Now, on that basis, 421 00:24:33,200 --> 00:24:36,280 Speaker 3: I feel as though the conversation about succession is much 422 00:24:36,400 --> 00:24:39,639 Speaker 3: less urgent today than it felt when he returned, and 423 00:24:39,720 --> 00:24:42,520 Speaker 3: so it's impossible to know today truly who will be 424 00:24:42,600 --> 00:24:45,600 Speaker 3: running Disney come twenty twenty six, or even the shape 425 00:24:45,600 --> 00:24:48,200 Speaker 3: that Disney will have taken in twenty twenty six based 426 00:24:48,240 --> 00:24:51,400 Speaker 3: on what ascid disposals might be available to him. What's 427 00:24:51,440 --> 00:24:55,480 Speaker 3: interesting to consider is that Bob's run so far is 428 00:24:56,000 --> 00:25:00,760 Speaker 3: truly diametrically opposed to his first tenure, and as a 429 00:25:00,800 --> 00:25:03,440 Speaker 3: result of that, you have to imagine that he either 430 00:25:03,520 --> 00:25:06,760 Speaker 3: must truly love the company and love the brand to 431 00:25:06,760 --> 00:25:09,760 Speaker 3: put himself through this one more time, potentially at the 432 00:25:09,800 --> 00:25:13,640 Speaker 3: expense of his legacy, or it's simply the case. As 433 00:25:13,680 --> 00:25:17,240 Speaker 3: sources told me during his retirement that he can't imagine 434 00:25:17,320 --> 00:25:19,760 Speaker 3: himself doing anything else than being the CEO of the 435 00:25:19,760 --> 00:25:20,720 Speaker 3: Walt Disney Company. 436 00:25:21,560 --> 00:25:24,119 Speaker 1: Thomas, this is just fascinating. Thanks so much for taking 437 00:25:24,200 --> 00:25:25,560 Speaker 1: us inside Disney. 438 00:25:25,840 --> 00:25:27,439 Speaker 3: Well, thank you so much for making the time speaks 439 00:25:27,400 --> 00:25:27,600 Speaker 3: to me. 440 00:25:29,040 --> 00:25:30,960 Speaker 1: Thanks for listening to us here at The Big Take. 441 00:25:31,080 --> 00:25:34,360 Speaker 1: It's a daily podcast from Bloomberg and iHeartRadio. For more 442 00:25:34,400 --> 00:25:38,520 Speaker 1: shows from iHeartRadio, visit the iHeartRadio app, Apple Podcasts, or 443 00:25:38,560 --> 00:25:41,400 Speaker 1: wherever you listen, and we'd love to hear from you. 444 00:25:41,720 --> 00:25:44,800 Speaker 1: Email us questions or comments to Big Take at Bloomberg 445 00:25:44,840 --> 00:25:48,040 Speaker 1: dot net. The supervising producer of The Big Take is 446 00:25:48,119 --> 00:25:52,560 Speaker 1: Vicky Ergolina. Our senior producer is Catherine Fink. Our producers 447 00:25:52,600 --> 00:25:56,679 Speaker 1: are Moberrow and Michael falleerro Hiel de Garcia is our engineer. 448 00:25:57,119 --> 00:26:01,000 Speaker 1: Our original music was composed by Leo Sidrin. I'm west Kesova. 449 00:26:01,280 --> 00:26:03,400 Speaker 1: We'll be back tomorrow with another Big Take.