Dear Walt: - From Mickey

[hopemax]

And I still have the question, if they didn't take the company public, would the company survived WWII? From the Bob Thomas biography, 45% of the company's income came from overseas. When the war started they lost that. If they had watched the purse strings, could they have realistically overcome that kind of a sudden deficit?

 

[Captain Crook]

No, they probably couldn't (wouldn't) have survived. Walt, IMO, chose the most viable option available to him, but that puts us right where we are today. A large Company trying to stay independent in a cuthroat industry, in a faultering economy...But it too, is really a moot point. We can't know what would have transpired should Walt have choose the private route and the fact is at the time (of DL and going public) Walt was already "done" with animation. His new toy, DL, was in focus and he needed money now. In order to continue to live his dreams he did the only thing he could...He went public. Mr. Eisner has run the Company on those terms (as a sahrk in the ocean). Is he still on top of his game? Well now, that can probably be debated vigorously!

 

[hopemax]

You know, I've never begrudged Eisner/Wells from growing the company; it was necessary. I just don't understand why the old and new Disney can't be run more independently of each other.

The Disney internet group had it's own stock, why couldn't something similar be set up where one business group was "Walt Disney Products" which would be Theme parks, animation, Walt Disney Pictures, merchandising from previous, Disney channel, etc." The things we normally associate with Walt and the old Disney. And another group with ABC, the other movie divisions, other television, radio, the sports teams, etc.

Let each side be responsible for it's own success or failures. The theme parks shouldn't have to tighten up because Pearl Harbor bombed for example.

I don't really know much about business, but how does it work with Kraft/Miller/Philip Morris?

 

[DVC-Landbaron]

I've stayed away for a while. Twofold reason. I wanted to see where this would go without me, and I've been busy this weekend with our good friend bicker on RADP. I have escaped with my life, but just barely!!

I could refute the article point by point

That's why I posted it.

…but what's the use? You'll see what you want...

And you see what you want.

But let me say this…

OK, say it.


_______________________________

Oh no!! I'm caught in bicker-speak and I can't get out!!!

Sorry. I couldn't resist!!!

OK Mr. Captain, my old friend, let's get down to it!!!

I really don't know what I can add to the wonderfully insightful posts of AV, but that never stopped me before!!

who put the Company in the position of defending itself in a public marketplace? Anyone? Come on now? Of course, it was Walt!

You are right. He and Roy took the company public. But, somehow, I don't know how, they were able to build Disneyland though they were public. AND, they were able to build WDW though they were public. AND, they were able to build EPCOT though they were public. WOW!!! With successes like that, I think they could afford a few failures!! They also had quite a few cinematic successes. Look, Mr. Pir.. ahhh… Captain, all businesses have failures and successes. Let's not confuse a couple of minor setbacks with the abysmal performance of the current regime.

These are things that today's Walt worshipers refuse to acknowledge. Had he listened to Roy a little more often and stayed within the boundaries of sound business practices then perhaps the Company could still be closely held today.

Ahhhh! I see, said the blind man. We are coming at this from totally different angles. It's more than half empty/half full. Or rose colored anything! You really believe that things would have been better off, in the long run, if Roy would have been more influential. Well, at least I understand your point of view now. It only took a little under a year!!

Are you surprised that I might respond - Mr. Captain: With all due respect and in the kindest way possible - - - - YOU'RE NUTS!!!!!!!

Eisner inherited a crappy company about to become dog food for some rotwiler and played the game.

Absolutely not! It was a very solid company which had underutilized assests. That is why it was ripe for take over. The parks were making a TON of money, Touchstone was invented and The Little Mermaid in development. The problem was stagnation regarding their vast film library and real estate holdings (read: Florida property) which had become exceedingly valuable. It was hardly dog food!!

The days of the old" Disney were fried when Walt went "public,"

And yet, they were able to build Disneyland though they were public. AND, they were able to build WDW though they were public. AND, they were able to build EPCOT though they were public. As opposed to MGM, AK and DCA!! We seem to be going downhill!!

But most of the discussion around here centers on Eisner as the blame for the loss of the magic and I contend that just isn't so.

So you are saying, if I understand you right that NO ONE else could have possibly done a better job than Ei$ner? Did I understand you right? If that's the case: I disagree.

thedscoop:

Kind of like how supporters so quickly ignore the untoward conduct of other "great men" like Martin Luther King, Jr. and Thomas Jefferson for example.

You know, AV pretty much covered this, but I've just got to chime in. What difference does it make at all whether or not Jefferson had a lascivious affair, when you are reading the Declaration of Independence. Or learning about the Louisiana Purchase? Or finding out that the Lewis & Clark expedition was his baby? Answer: NONE!!

The same holds true with Walt. If you understand his philosophy, you "get" the SHOW, it doesn't matter one iota if he drank, smoked or had some failures along the way. The idea is you "get" the concept. You "know" what makes (made) Disney so unique. So exceptional. So extraordinary. Ei$ner, I'm afraid, in my opinion, just plain old "doesn't get it"! And he's letting the Disney name and the Disney experience become ordinary. And that is sad.

Why so little discussion of Disney's live theatre and Celebration?

Cause in the grand scheme of things it just doesn't matter to most people. If it did, for as many times as you've mentioned it, SOMEONE would have jumped on your bandwagon. No one has. Sorry.

Thus, while Walt was certainly more creative than Eisner, Walt was not a real good businessman.

Yes. And he knew it. He had a partner you may recall. His name was Roy. HE was the businessman. Walt said on many occasions that without Roy, Walt would have ended up in jail for passing bad checks. He knew his weaknesses and compensated for them.

Likewise, Wells was not especially creative, but he was a pretty good businessman.

And what has Ei$ner done to compensate for his weaknesses? Answer: Nothing!!


Captain again:

As to whether it IS time for Eisner to go, well that's a different argument when Walt's ghost isn't invoked, IMO.

No. It's this very argument. And it is only by holding up Walt's philosophy (or ghost if you will) that we have any criteria on which to base a judgement. Is he building the company (especially the theme parks) in the philosophy and ideals of the creator? Or has he changed direction? Remember that those same ideals were created AFTER the company was public. No different for Walt than it is for Ei$ner. Disneyland was conceived well AFTER the company went public. Yet look at the differences in philosophy. They are WORLDS apart!

 

[airlarry!]

Aha!

I have finally figured it out, Baron.

There are those of us who look at the past magic Walt created EVEN AFTER GOING PUBLIC (like, err, some little park called Disneyland?)...and expect that the company maintain that high standard in every avenue. EVERY avenue.

Then, there are those of us who look at the past magic Walt created and say, well Walt is the one who took us public, and Walt's brand of magic cannot be created by a public company and so <sigh> there is nothing that can be done. Mr. E is doing the best job with the hand he has been dealt. The iceberg is in front of us, sir, and we cannot steer around it. It is just an obstacle that cannot be removed.

Poppycock.

Just because a company goes public does not mean that the shareholders cannot require that the Board focus on what got them there in the first place. Creating Magic. Take a small example.

I love Pixar. I own Pixar stock. I think John Lassiter is secretly Walt unfrozen from his perch in the cryogenic chamber above the castle in Orlando. So there is my disclosure....but Pixar is a publicly traded company that has produced an impressive track of 'magic.' Despite shareholders. Despite a board of directors. Etc. blah blah yada yada.

Okay. Ask yourself. Which side of the fence are you? Do you apologize for ME because he's doing the best he could with the situation that Walt supposedly left him? Or do you chastize Mr. Eisner, because he's doing less than he can do with the wonderful brand name and magic factory that Walt built up and left him?

But be realistic. Don't blame the current management's problems on Walt. In fact, had they left Paul Pressler in charge of the Disney Stores....ah...but that's for another post.

 

[YoHo]

I don't think ME is blameless, he made a huge number of bad decisions. I just don't think most of the combatants here understand that the pressures are different.
Yes, Walt had successes, But I would bet Dollars to doughnuts that even though it was a public company, It was reasonably closely held.

There has been a major shift for the Whole marketplace in longterm vs. Short Term thinking. in the 1950-60. You could take the long view. In this day and age of dot coms going boom and bust in a matter of month's there is no long term view. Thus it is harder for Eisner to successfully chart a course of long term profitability and growth when the owners (stockholders) want it yesterday.

ME may or may not want to do things the good old Walt way, I don't know, but Joe Stock broker doesn't give a damn about magic and while Joe's dad might have been content to sit on it and wait, he wants his fortune NOW!


Its a question that often gets asked, is the financial climate different now then it was then. I think that while the sharks were still there, the performance expectations have drastically changed in the past 5 years.

 

[King Triton]

Unbelievable!! Ei$ner making $737 million dollars over the last 5 years. Walt is turning over in his grave right now. Think of all the new rides Disney could have with just a tiny little portion of that money. Heck, Epcot would still have Horizons and World of Motion with a portion of that money. Come on Ei$ner, how much do you really need? If you really loved Disney, you would give that money back to make more Magic. If I were a stockholder, I would be furious. The problem is Disney is spreading itself too thin. Focus on the magic and not more internet deals or cutting deals with McDonalds. Hey, make me CEO of Disney and I'll work for free - my reward would be making little kids smile. Let's get back to the magic.

King Triton

 

[Captain Crook]

airlarry, again, I am not so much apologizing for Eisner as I am saying you can't blame him for the path he's taken the Company without going to the source...Walt.

As Yoho alludes to, the Disney Company was initially a closely held public Company in the beginning and as they needed more & more capital the percentages dropped & dropped. It's typical and it's not good or bad. It just happened. The reason he needed so much capital was that the animation departement had all but collapsed with the failure of Snow White & the weight of the War...

Additionally, let me repeat I don't blame you for disliking Eisner's performance, I am not always thrilled (recall the Tiger Woods decision?), but don't bash Eisner and say he should be Walt. That doesn't hold water. Bash Eisner on the principals of business you disagree with. - A very interesting case in point is reflected in a thread posted by Sarangel on the value of the Disney brand. After taking the Disney name to unthinkable heights it seems (to me) that perhaps Eisner etal. have hit the wall and are now dilluding the brand with too much (too much cheap, too much common, just too much).

So there I've stated that disagreeing with Eisner is OK, fine, even great, but do it on a level playing field, not on hallowed ground where ghosts of the past are revered.

 

[WDWHound]

In a way, the captain is right, but only in a way. Walt's taking the company public laid the seeds for the possiblity of the Disney Companies situation, but it was not inevitable. If the company had good leadership today, it would not have these problems.

Publicly traded companies tend to hold short term profit higher than anything else, and this is what is killing Disney now. Still, a good CEO should be able to strike a balance between short term gains and long term invertment in quality and this is where Eisner has screwed up.

But it wasn't always this way For the first 10 years of his reign, Eisner made the investments the company needed to stay ahead and the company began to prosper. He added e-ticket attractions to the parks and he supported quality anmated features like Mermaid and BATB. He recognized the need for quality products and spent the bucks needed to produce them.

Then, a few years ago, short term profits became king. He began cutting back on quality in the parks (DisneyLand and the Magic Kingdon have not had a new e-ticket in over 5 years!). Animation also suffered due the constant cost cutting. He also began investing in areas outside of Disney's market (Just what possed him to buy a hockey team). Go.com was another flop, but I can at least understand why he did it. Could he really risk not going to the internet when everyone was calling it the wave of the future.

So as the flops began to hemorage money, Eisner began to squeeze his profit centers (the parks and animation) more and more for that short term profit the stock holders were screaming for, and he continues to this day. The problem is, in cutting corners and building incomplete parks that are not up to the Disney standard, he has finally cut them to the point where they are not capable of producing either the big short term profits investors demand, or the long term profits needed for growth. Califonia Advenure is proof of this. They built a themed shopping and retaurant complex with a few (very few) of the shelf rides. The problem is people wanted a theme park, so they stayed away. Mork specifically, they wanted a theme park with rides up to Disney's standard. Gee, all those shops could sure generate a lot of revenue. Too bad they are located in a park that has nothing to do.

Anyway, the Disney Company has clearly been worshipping at the alter of short term profits for several years now and the company is beginning to fail because of it. But I don't blame Walt or the stockholders, I blame Eisner. He has shown that he knows how to invest in quality (he did so in his early years at the helm), but he has choosen to milk this cow for all its worth instead.

And don't tell me that he is just responding to the demands of the stockholders. Eisner has nothing to fear from them. Lets face it folks, the man has surrounded himself on the board by friends and croonies who NEVER vote against him. You couldn't blast him off that board with plastique and he knows it. He could have choosen to take some short term profits and then invest again to secure the companies future. Sure, the stockholders might yell, but they would be powerless to move aginst him and he would end up helping them in spite of themselves. Instead, he has choosen to cut back quality and raise prices again and again as he milks the mouse for every dime. That makes him either greedy or inept.

No, its not the cry for short term profits that have brought Disney to its knees. Its certainly not Walt taking the company public (by that logic, all publically traded enterainment companies are doomed). Those thing just made the current situation possible, they didn't make it happen. The fault lies with Eisners continuing sacrifice of quality for short term profit. I don't know if its greed or incompetance, but the fault lies squarely in Eisner's hands. I just pray he decides to quit soon, before there is nothing left to save.

 

[DVC-Landbaron]

The reason he needed so much capital was that the animation departement had all but collapsed with the failure of Snow White & the weight of the War...

Me thinks you misspoke. Snow White?

 

[Captain Crook]

Landbaron, me thinks I uttered a bobo, as well...I meant to say Sleeping Beauty, of course...

WDWHound, I'm more right than you want to admit, I think. For I don't dispute the form of any of your arguments. You didn't invoke ghosts from the past and you were on target with your business assumptions...The decision to go public paved the way for things to happen the way they have. Walt made that decision. Could good/better management avert, change or repair damage done? Certainly, and if Eisner's incompetent he should be removed.

I still think he showed great affinity for keeping Disney on a good path early in his career & I only hope that as his years at Disney grow short he has a strong desire to go out as "the big cheese" and not the "pretender mouse."

 

[Neville]

Whoa. Let's take it easy here. It's all good fun....

I think we are all universal-ly saying the same thing. First off, I agree with you Scoop, the live broadway shows are excellent -- I saw the Lion King in London and am still in awe. However, what I saw in that show, I used to see in the parks. To me you hit upon a key area -- quality across the board -- not just in one or two areas.

I like to use the BMW scenario. They have stuck to what they do best -- building the premier luxury vehicle. So far they haven't been gobbled up by the larger car companies, because quite simply, they could not afford to buy them. The premium on the brand is too strong. Keep in mind they are publicly traded. I'm not saying they are perfect (no company is), but they seem to understand that they can charge a premium price for a premium product -- thus perserving short and long term cash flow/revenue. How often to you see a discount on a BMW? To me, WDW/DL was the BMWs of theme parks.

ME seems to have forgotten this. When they have to begin discounting (similar to other car companies) to bring people in California Adventure - there newest park - something has gone horribly wrong. I would venture to guess that AK, Disneyland Paris, Go, etc made Eisner gun shy with the analysts and instead of boldy spend a bring out a park to revolutinize the industry, he chose a dud. In fact, he is letting the other ones get there as well -- painters in MK, carnival rides, etc

 

[Bugeye]

How's this - both the Captain and the rest of us are correct. We are ticked that the Disney magic is dimming fast and for philisophical reasons we are bummed out. But as a share holder, I'm bummed out that the jewel of the Disney Corp is being allowed to slide down the mountain while the competition is climbing up. I still think that ABC is the anchor dragging it down but the theme parks are paying the price as well as the studios. Every new adventure is a risk and some will fail but I hate to see them cover their costs by diverting funds from the parks. It appears that until Mr. Eisner moves on, we will have to hang onto Mr. Toad's ride.

 

[KimOhio]

thank you for sharing, but how sad, why do we live in a world where we think it is still magically no matter what

 

[DVC-Landbaron]

Well, its your response on Disney live theatre. In the past its always seemed to be QUALITY, QUALITY, QUALITY. A great refrain, but that might be all it is.

It still is, thedscoop. It still is. The point of my comment is that I personally, and I guess others from their lack of response; have no point of reference for your question. I’ve never seen it!!! And I don’t know anyone who has!! It’s not even talked about, from what I see and the lack of response, on these boards. It’s just that simple. I don’t KNOW if it’s good or not. I would assume it fairly good; it’s been on Broadway for quite a while. As for the quality, I simply DON’T KNOW!!! I’m not being dismissive. I’m trying to be real.

You might notice that I don’t post much about the Disney Stores either. Except to say that my wife used to go there and get her Disney ’fix’. I’ve been there. I’m not much of a shopper. So I don’t post about it!!! That simple. Not dismissive, just not that interested. If you want to talk about, go ahead. Start a thread. I’ll read it, but I doubt I’ll post on it. It just doesn’t float my boat is all.

I visited Celebration once. And I found AV’s description pretty much summed it up. No different from an upscale housing development in a typical Chicago suburb. I have some friends who live in one that seems he same. Again, I don’t know much about it. Is it good? Is it bad? Is there quality? I DON’T KNOW!!!! Do you? Well, then write about it and at the very least I’ll have your take on it for a point of reference.

And while you didn’t mention it there are other things I don’t post on either. The cruise line is one. Never been. No point of reference. Want another? Tokyo Disneyland. Never been there. Heard some great things, but I really don't know. It has not even come close to getting the same amount of press as DCA.

What I do know is WDW!!! On that I am an expert!! And I can tell you without prejudice and with absolute certainty that the quality has indeed gone down. You want to talk about that; I’m your guy!!!!

Well Baron, sorry that something Walt had nothing to do with ever turned out "magical" I know it hurts your argument.

No!! Not at all!! Did you miss my state of the parks address? It was simply gushing with praise! Even some of the Ei$ner bits!! You really don’t get me at all, do you? Contrary to your opinion, I LOVE finding magic. I almost live for it. It’s just getting so hard to find lately!!!

....regardless of how many people are there....oops, forgot to mention, it's a sellout. whoa, hold on baron, I'm talking about the show, not your opinions.

I just wanted to make sure every one saw this. A good quote is always worth repeating!

thank you for sharing, but how sad, why do we live in a world where we think it is still magically no matter what

thedscoop? Care to answer KimOhio's simple question?

 

[HBK]

And what has Ei$ner done to compensate for his weaknesses? Answer: Nothing!!

Nah Land Baron....he's done lots of stuff. He paid 200+ Million to the midget, he threw money at his fall guys (Schindler, et al) and he's hired a yes man (Iger)

Ah....thedscoop.....

Ei$ner has had a hand in creating magic....it just seems that within the past 5 years or so he's lost control of the company. He's prostituting the brand name (DCA, DAK, Pearl).

The disney brand name over the past 5 years has lost the one thing that matters the most. It's value. People are becoming wise to Ei$ner's tricks.....

People aren't flocking to the newest theme parks souley based on the brand name. They aren't flocking to the latest movies souley based on the brand name.

In the past, people would flock to the latest Disney park just because Disney made it (I know I did....AK was built before I became "internet smart").

The majority of people don't associate Disney animation with quality. The proof in that pudding is Atlantis vs Shrek.

That's my arguement dscoop. Ei$ner's created magic before. But he's not doing it now, and hasn't for a long time. And for every moment he continues this pattern of behavior, the Disney franchise becomes less and less valuable.

And that scares the pants off of me.

 

[DVC-Landbaron]

Unfortunately, DVCLB, you seem to have not visited or experienced firsthand this brilliant magic.

Let me get this straight. The only way I (or anyone, if you are at all fair) can criticize Ei$ner, for business decisions effecting WDW or films, is if I've personally experienced EVERYTHING the Disney company has to offer? Did I get that right? I that what you're saying?

So I have to live in Celebration, frequent Disney Stores, fly to New York and see their Broadway offerings, take the cruise, read the books published by Disney, etc. Do I also have to travel to Tokyo (no you told me I didn't. How confusing???) and Paris or can I skate by with the "theme" park experience with only five parks under my belt? Do I need to have a meal at every restaurant in WDW, visit every shop, and stay at every resort? MY OH MY!! Think of the wasted DVD point!!!

Wait!! It gets worse!! At every restaurant, do I need to try every meal? How far does this go? Where is the point at which it becomes absurd? Personally, I think you are already there with your insistence that I need to experience Broadway for a realistic perspective!

Maybe your general pessimism would become somewhat qualified

WOW!! Such a short fragment and already there are two thing wrong. "Somewhat qualified"? Excuse me? Are you doubting my credentials of Ardent Disney Fan and Magic Personified!!?? "Somewhat qualified"? Please point to the person on this board who by your definition is "fully qualified". Yourself?

And second, I do not have general pessimism. Anyone following my writings (rantings) should be capable of seeing that. I have a love for Disney (especially WDW) and want to see it returned to its former glory. Nothing more. But certainly nothing less. I refuse to blindly accept current management dogma. I cannot fathom those who would make excuses. To me there is no justification for the current state of affairs. You might be willing to settle, but I'm not!!!! I don't see that as pessimism. I see it as reality. I see it as truth.

...but DVCLB, my frustration was vented because it appears IMHO that, in expressing your complaints (which in some cases I have agreed are valid) your carpool trashes current Disney without either acknowledging or addressing or giving due credit to the new "magic"

OK!! Analogy time. I have a child. A wonderful, spirited daughter. She is a joy to be with. Socially, nearly everyone who meets her is instantly captivated. Academically she leaves a little to be desired. On her last report card:
A - 1
B - 0
C - 1
D - 3
F - 1

The "A" was in algebra, a very tough subject for her. The marking period before she received a "D". She was delighted as she handed me her report card. And consequently couldn't understand for the life of her why I wasn't enthusiastic. I congratulated her on her "A". I was gushing with praise. Then I pointed out the "F". She countered with the "A". I told her that 3 Ds were unacceptable! She reminded me of her "A". I said that I was less than impressed with the "C" in physics. She pointed to her "A" again. I finally had to laugh a little. "OK", I told her, "It only gets to cancel out one bad grade, you pick which one!! Then we'll discuss the others!!"

And really that still a bad way to look at it. She should be striving for an "A" constantly. Instead she's perfectly happy with her C/D performance and figures that the "A" cancels out the "F"!!! You are asking me to do the same! How many times are you going to point to Ei$ner's "A". How many times do I have to acknowledge that he has in fact gotten an "A" here or there. Once a thread? Every other post? Most of the time it is NOT the question at hand. Start an Ei$ner loving thread. Point out all his virtues. Have a ball. I might even surprise you a post a couple positive things that I've experienced. BUT STOP POINTING TO THE "A" as a defense or excuse for all the "Fs"!

 

[HBK]

Let me get this straight. The only way I (or anyone, if you are at all fair) can criticize Ei$ner, for business decisions effecting WDW or films, is if I've personally experienced EVERYTHING the Disney company has to offer? Did I get that right? I that what you're saying?

Let me say this...I will NEVER visit DCA as it stands right now....so I guess that disqualifies me as an expert...


P.S. Shouldn't I be able to make an educated decision on whether to go to a park or movie based on it's advertising?

Do other products get the same treatment by members of the other car pool? Do they try everything....even if the advertising doesn't envoke some type of emotion in them?

 

[YoHo]

Shouldn't I be able to make an educated decision on whether to go to a park or movie based on it's advertising?

Yes you should, please name one thing that is advertised for in this country that you can in fact make that educated decision on.



YoHo, King of irrelevent interludes.

 

[HBK]

Universal IOA.

As I've stated in the past....I am going on my honey moon in october. I had planned on only going to the Disney properties.....

And then I read Jim Hill's artice describing IOA. That article made me immediatly change my plans and I purchased a three day pass to Universal.

I've seen article (both positive and negative) about DCA. I've reviewed Disney's advertising & literature.

I can't see why I would want to go. I don't go on vacations to places just because "I haven't gone there before". I need a reason. And nothing has shown me that I need to go to DCA.

Now, after doing that research, I feel I can make some pretty good asertaions about DCA. I don't need to go experince it. Disney hasn't given me a reason to.

Doesn't make me any less of an expert....just one who doesn't have the magical blinders (thanks AV) on.