More Imagineering Downsizing

[raidermatt]

I could be wrong, but I think we're argueing the same point. Those of us that do post on boards like this do care about what is happening within Disney. The other 99% don't which has allowed ME to make wholesale changes within the company - its entire business philosophy - without so much as a peep of outcry until the last couple of years.

We agree that most don't care how or why things happen, but I'm also pointing out that how/why they happen has a direct impact on the quality of products Disney produces. Disney's customers most certainly care about that, and they have been seeing less consistency in this as time has gone buy.

Disney used to "out-content" their rivals. Now they increasingly rely on outside companies to supply the content, and then try to "out-distribute" and "out-market" their rivals, where its much harder to differentiate yourself. The Street may like the idea of spending less money up-front, but if the results on the backend don't measure up, they won't cut you any slack.

Which brings us back to the stock. Any chart longer than 3 years shows Disney falling short of both the S&P and DJIA. Disney had a decent run-up in the last couple of years, but even that didn't leave them much better off than the S&P, and the DJIA has been closing the gap, despite a few positive brokerage comments.

But debating where the stock is going is almost as pointless as debating who will win the Super Bowl in 5 years. What was said was that the investors were dictating policy to Disney, and Iger had little choice but to go along with it. The point I'm making is that Disney has been doing this for years now, yet the investors have not responded. So perhaps decisions should be made based on what will actually be the best strategic direction for the company rather than what some Wall Street number crunchers think is best.

Now, if Disney's management team thinks that cutting loose its creative soul is the best strategic direction, and apparently they do given how they've handled animation and Imagineering, then I submit that this management team has not been the best team for Disney, and isn't the best team for the future. Not that anyone in any position of power gives a rat's patoot what I think, but then again, at least we're all in the same boat on that front.

You would think someone on Wall Street would notice that this stagegy stopped reaping benefits years ago, but apparently they haven't.

I don't blame the guys/gals on Wall Street, though. They're going to stick with what they know, and if they knew how to create entertainment, they probably would have chosen a different career path.

Its up to Disney's management team to tell Wall Street what will work. True, if its not exactly what the Street was expecting, then they will be skeptical. But what's going to happen that hasn't already? The stock will stagnate "more"?

Of course, the pressure will then be on Disney to deliver results, which is all the Street cares about, but how is that any different than now?

 

[DarkSideMoon]

disney,disney,disney, what the heck are you doing? getting rid of imagineers is dumb, plain and simple. guess where they go with some of the ideas they brainstormed U-N-I-V-E-R-S-A-L! first the imagineers, now resort staff, what next? one of the reasons i love disney is they hire people others wont, older ppl, imagrants ect. why does disney act like they are losing money like an airline? they are MAKING money, generrally you dont change stuff like this unless you are not making money in which case outsourcing is ok because it would keep disney above the red.

 

[k5thbeatle]

I hate the Dallas Cowboys. Who's my favorite team ? Whoever the Cowboys are playing on Sunday. Jobs hates ME but he also knows the most profitable distributor he can sign with is Disney. So yeah, he's going to praise Iger. It's ALL about the $$$$.

The only hope we have to a return to the old Disney is if Iger truely believes he can turn double digit returns doing things the way Walt did and quite honestly I don't see that ever happening again, regardless of who's in charge. The money mongers out there are not concerned with "creative content" or being "an original". Instituitional investers want huge returns, not "show".

I read an interview with Roy where he was asked what kind of growth and returns he thought were acceptable. His ( and Walts ) business model included heavy reinvestment into the company with a steady 5% annual profit. Sorry to say it, but today, that's not acceptable.

Well said. Let's face it. Walt Disney is a person that only comes around once every few hundred years. The machine is now in motion and barring some miracle where another genius like WD gets the reigns, even if someone like this did come around it would be hard to reverse course!