Iger Interview with Wall Street Journal

[GrimGhost]

Redirecting Disney

CEO Iger's Push for Change Goes Far Beyond iPod Deal; Fewer Films, Evolving Parks


By MERISSA MARR
Staff Reporter of THE WALL STREET JOURNAL
December 5, 2005


This is an excerpt from this article:

WSJ: What about a bigger media industry deal?

Mr. Iger: You can't ever rule out the possibility of some kind of transforming deal. It would be irresponsible. I don't have any qualms at all about moving the company forward without such a deal, meaning I think we're set up nicely from a strategic perspective. I wouldn't rule out forever either a combination of assets or some deal large or small, but we're not currently looking at anything that radical. ... There's a pressure on corporations in general to get deals done, make changes, make headlines. There's also a pressure because I'm new to show change or mark my territory. ... Every once in a while I pause and I think, OK, there was that announcement last month, what are we going to do next? I think the world is looking at the pace of strategic change and deal making. It would be wrong to give in to that, but I definitely feel it.


Can someone else please tell me what they think he means by this

 

[Horace Horsecollar]

Can someone else please tell me what they think he means by this

It means that Bob Iger is not committing one way or the other regarding future mergers and acquisitions involving The Walt Disney Company.

In other words, he's leaving the door open to a merger or acquisitions — involving a big company like Time Warner or Comcast, or smaller media production or distribution companies — but is also saying that Disney doesn't necessarily need such a deal to be successful.

 

[GrimGhost]

That was my fear. I guess I hoped, he would have a stance something along the lines of Disney can and should remain independent!

 

[bicker]

That would likely cause the stock price to immediately plummet, and would possibly contribute to a speedy end to Iger's leadership. There is no place for sacred cows when running a business.

 

[GrimGhost]

That would likely cause the stock price to immediately plummet, and would possibly contribute to a speedy end to Iger's leadership. There is no place for sacred cows when running a business.

I know. I understand he has to say what he said in a publically run company. I just had Comcast flashbacks.

 

[bicker]

Someone asked a few days ago whether WDW will still be around in 100 years. Let's go back 100 years. First, there was no WDW, no Disney Company. So let's consider the major companies that did exist then, what they offered, how they operated.... Would any of their fiercest advocates back then even recognize those companies today? Now, given the nature of the progression of time, I'd suggest that the rate of change (as a general concept with regard to society, culture, governments, people, commerce, specific businesses, etc.) is increasing, so I doubt it would require 100 years to make many, if not most, things seem radically different from what they are today. My point is if Disney doesn't become something else, and probably within the next 50 years, just as it has become something else since 1956, it will likely not exist. Change or die.

 

[Another Voice]

Let's go back 100 years.

Yea, The Coca-Cola Company (founded 1886) would still be around today if they hadn't insisted on selling all that silly sugar water. What were they thinking?!


Disney thrived because it produced movies the public wanted to see and created theme parks the public wanted to visit. The temporary, insignificant changes in business practices don't matter – except to the people that can't make movies the public wants to see or places they want to visit. It's the difference between confidently offering a product you know the public wants, or trying to con the public out of money with as little effort as possible.

Not being on the cutting edge of corporate finance didn't prevent the company from making Dumbo or Disneyland. Being in the Dow and invested in international hedge funds couldn't make anyone suffer through Home on the Range or Disney's California Adventure.

Disney's key to surviving the next hundred years doesn't depend on business consultants analyzing this week's fashionable scam to make the CEO richer – it depends on the ability of film makers and designers to spark the imagination of their audience.

"Change or die" is meaningless. "Make the audience care" will lead to success.

 

[Aintdisablast]

Go back and read the ingrediants of that first bottle of pop. It's fairly obvious Coke would be unable to operate today as it did 100 years ago.

 

[manning]

Go back and read the ingrediants of that first bottle of pop. It's fairly obvious Coke would be unable to operate today as it did 100 years ago.

But some still say it is habit forming

 

[bicker]

Yea, The Coca-Cola Company (founded 1886) would still be around today if they hadn't insisted on selling all that silly sugar water. What were they thinking?!

Of course, the Coca-Cola being sold today is nothing like the Coca-Cola they were selling back then. The formula has changed, the packaging has changed, the distribution has changed, the product catalog has changed, the target audience has changed -- just about every thing about Coca-Cola that could change and it still be a soft drink company has changed.

Disney's key to surviving the next hundred years doesn't depend on business consultants analyzing this week's fashionable scam to make the CEO richer – it depends on the ability of film makers and designers to spark the imagination of their audience.

Not alone. Substance without style results in failure faster than style without substance. That's the reality of today's marketplace.

We don't have to like it, but that's the reality of the marketplace today.

 

[Euphscott]

But often solid, well created substance creates or defines style. Disney brought the movies in to the world of color by creating ground breaking films. They created a new style of family amusement with a bold amusement park and so on down the line.

Kids (and adults for that matter) these days are much different than in Walt's day, but it's still a good story and new and creative way of presenting ideas that capture the imagination of consumers. Cinderella 6 direct to video and "me-too" marketing is not what sets the world on fire or creates a new 52 week high.

 

[bicker]

Scott: Could you please mention some relevant examples of what you're talking about, i.e., large, multi-national, entertainment conglomerates that recently (let's say, within the last five years) have built "solid, well created substance that created or defined style"?

 

[DisneyKidds]

......just about every thing about Coca-Cola that could change and it still be a soft drink company has changed.

And you've hit on the perfect example of what is wrong with the Walt Disney Company today.

The Coca Cola company started as a soft drink company, and that is what they are today. Go ahead. Look at their brand list. Sure, they may have added brands to the drink line, changed production techniques, experimented with formulas, targeted different demographics, etc., etc. But in the end they are still a soft drink company.

The Coca-Cola/Disney parallel falls apart when you realize that the Walt Disney Company started of as an animation studio that created great content. In fact, much like Coca Cola was and is a leader in the soft drink biz, Disney was the leader in animation. Somewhere along the line that changed. Disney went from being a premier creator of content, to a conglomerate that hardly produces quality animated content any longer (forget that part about being the leader) and now is involved in TV, Cable, the Internet, content distribution, food sales and marketing, merchandising, etc., etc., etc. and a plethora of other things.

The Coca-Cola company, despite it's changes, it's successes and failures, has stayed true to what the company has always been about. Disney has not.

The Coca-Cola company was smart enought to know when the New Coke was a falure. Unfortunately the Walt Disney Company of the 80's wasn't so smart and we are still living with Disney's version of New Coke.

 

[bicker]

It started long before the 80's. Disney diversified in the 1950s by building a theme park, and again in the 1970s by building hotels. Their more recent acquisitions, of radio stations and television networks make a lot more sense with respect to the original core of the company.

So perhaps Disneyland and WDW should never have existed?

 

[DisneyKidds]

That is the best reply you can muster?

I'll let somebody else beat their head against the wall on this one..........

 

[YoHo]

Could you please mention some relevant examples of what you're talking about,

Peter JAckson and the Lord of the Rings/Harry potter. Looks like that means Warner Brothers.
Especially since Disney is trying to emulate them

As for this

It started long before the 80's. Disney diversified in the 1950s by building a theme park, and again in the 1970s by building hotels. Their more recent acquisitions, of radio stations and television networks make a lot more sense with respect to the original core of the company.

So perhaps Disneyland and WDW should never have existed?

Um, last I checked, all that diversification prior to Eisner still focused on one overriding business goal. Telling good stories. The theme parks were just a new medium just as television was and Movies were. Animation, live actions. Just different forms of story telling. That's what distinguished Disneyland from Riverview.

Eisner has on the other hand diversified into distribution which was not the core focus of the company.

 

[Euphscott]

In response to your question Bicker, I think Yoho summed it up nicely.
Would Narnia have been made (or made in the style we see?) had LOTR and Harry Potter (and the resulting pay days) not burst on the scene?

Although, I might add that because no company has consistently produced style creating substance over the last number of years, all of the corporations have become "me too" centric and for the life of them cannot (or will not) take risks and tell the stories the way Disney used to do. Pixar is the closest answer to that void these days. I suspect that should someone decide to go back to story telling (as opposed to marketing crap and occasionally finding a good story that ends up making big bucks - funny how that correlates) they'd once again be the style and trend setters. But in this day of corporate suits more concerned about what Wall Street thinks than their customers, the best we can expect is that there will be a load of garbage hitting the market and occasional creative gems interspersed.