Iger is back and Chapek is out...

[MamaBelle4]

Resume plans on the Mary Poppins ride in Epcot, and please have it be a carousel where the horses go off course like in the movie (using Peter Pan ride system). While we're there, build a tea room where you can get a proper high tea with scones and clotted cream.

I would NEVER EVER EVER leave Epcot if they did this.

 

[sagosto]

So, Disney finally realized Chapek sucks and need to be fired? I love how they figured this out AFTER the extension.

 

[UGA03]

Per Iger:

“I’ve asked Dana Walden, Alan Bergman, Jimmy Pitaro, and Christine McCarthy to work together on the design of a new structure that puts more decision-making back in the hands of our creative teams and rationalizes costs, and this will necessitate a reorganization of Disney Media & Entertainment Distribution. As a result, Kareem Daniel will be leaving the company, and I hope you will all join me in thanking him for his many years of service to Disney… Our goal is to have the new structure in place in the coming months. Without question, elements of DMED will remain, but I fundamentally believe that storytelling is what fuels this company, and it belongs at the center of how we organize our businesses.”

 

[Mackenzie Click-Mickelson]

The Diamond Princess cruise ship in Japan reported some 600 cases by February 20, 2020. Iger stepped down February 25, 2020. Many parts of China, including Shanghai Disney, was already closed in January 2020. Iger saw the ways the winds were blowing for the theme park/cruise/travel business and didn't want the end of his reign to be defined by it. He's no fool.

Yes I'm aware of the timeline, but you need to remember what it was like back then. I know it's hard to remember but 2 weeks to flatten the curve wasn't until a month later near the end of March 2020. No one had a magic 8 ball back then to know what would happen. No one had a darn clue what the ramifications were. Everyone back then thought it was a momentary blip in time. A CEO does not bring up someone to be the fall guy for a pandemic that didn't exist back then. I get why you might think that but it you really just can't give Iger credit for predicting the future here.

 

[HopperFan]

While it was a “sudden” to outsiders, Bob C’s departure had been being formulated since last summer. This article was just linked to on twitter. The article was in the Financial Times.

https://s0.2mdn.net/ads/richmedia/s...&topOffset=0&c=QVEW3SDWq1&t=1&renderingType=2

Contradiction of what actually happened last summer. All they had to do was not renew his contract last summer, but they did.

 

[Mackenzie Click-Mickelson]

So, Disney finally realized Chapek sucks and need to be fired? I love how they figured this out AFTER the extension.

Yeah sometimes it's how it works. You think something may get better or surely not worse...

There may have also been issues with finding who they wanted and an extension the easier route at that time.

 

[Jrb1979]

Per Iger:

“I’ve asked Dana Walden, Alan Bergman, Jimmy Pitaro, and Christine McCarthy to work together on the design of a new structure that puts more decision-making back in the hands of our creative teams and rationalizes costs, and this will necessitate a reorganization of Disney Media & Entertainment Distribution. As a result, Kareem Daniel will be leaving the company, and I hope you will all join me in thanking him for his many years of service to Disney… Our goal is to have the new structure in place in the coming months. Without question, elements of DMED will remain, but I fundamentally believe that storytelling is what fuels this company, and it belongs at the center of how we organize our businesses.”

That tells me the parks are not the focus. They are focused on making Disney+ profitable and fixing the studios.

 

[squirk]

Yes everyone needs to go watch “Succession” if they want a peak inside
how this deal was likely made. I’m not at all surprised that they settled terms with Iger without Chapek’s knowledge before showing him the door.

Tonight, the part of Bob Chapek will be played by special guest-star Kendall Roy.

 

[Jrb1979]

So, Disney finally realized Chapek sucks and need to be fired? I love how they figured this out AFTER the extension.

From everything that's out there Chapek being let go was always the plan. He did exactly what they wanted him to do. IMO is only failure was Disney+. The parks are full and making lots of money.

 

[Mackenzie Click-Mickelson]

That tells me the parks are not the focus. They are focused on making Disney+ profitable and fixing the studios.

Yeah pretty sure the parks aren't going to be the main focus at least not initially because the main point is to correct other issues. Park stuff may be a can kicked down the road and it probably should as much as we all are disappointed with the state of the parks.

Although I don't think there's any leeway we should give for the state of the front of Epcot. Tron taking forever and the railroad being closed is beyond frustrating but it also doesn't restrict access and create such an eye sore like the front of Epcot is. It's not really excusable how long that has sat that way.

 

[OnceUponATime15]

Contradiction of what actually happened last summer. All they had to do was not renew his contract last summer, but they did.

Like in many business situations, the easiest route wasn’t taken. But there was already growing concern by a growing number of senior management about Bob C’s way of doing things and the results it was producing, especially after the last earnings call and it’s effect on stocks.

 

[ofcabbagesandkings]

Yes I'm aware of the timeline, but you need to remember what it was like back then. I know it's hard to remember but 2 weeks to flatten the curve wasn't until a month later near the end of March 2020. No one had a magic 8 ball back then to know what would happen. No one had a darn clue what the ramifications were. Everyone back then thought it was a momentary blip in time. A CEO does not bring up someone to be the fall guy for a pandemic that didn't exist back then. I get why you might think that but it you really just can't give Iger credit for predicting the future here.

Sure I can. It may not have been obvious to the layperson, but someone like Bob Iger had access to the data that necessitated the closure of Shanghai Disney and could read the tea leaves from there. A lot of people, my husband included, were studying the numbers and saying by January that mass public events (like a work conference I had scheduled for that March) would be canceled and they were right. People who reached that conclusion so early in the pandemic may have been in the minority but so are people smart enough to ascend the top of the ladder of one of the biggest corporations in America.

 

[HopperFan]

Like in many business situations, the easiest route wasn’t taken. But there was already growing concern by a growing number of senior management about Bob C’s way of doing things and the results it was producing, especially after the last earnings call and it’s effect on stocks.

We aren't talking about an uneasy route.

There were concerns from the minute he took over. It was obvious there were issues for the last year. If these conversations actually were had and being considered ... and the Board still makes a decision to keep him that could cost them around $50 million dollars months later ... complete failure.

I look at it as just another entity trying to get their sound bytes in to one of business's biggest stories.

 

[Tattylou]

I honestly don't see much changing to be fair.

Chapek found a way to make money on something that was previously free, most companies wouldn't turn away a free new revenue stream even at a lower guest satisfaction rating.

That being said I could see Genie+ being tweaked to where it's more like FP+ but at a paid level.

They had the system already in place, I could see by 1/1/23 you pay $10 or $15 and you get access to FP+ where you can make 3 reservations and actually pick the time slot convenient to you, and if you utilize all three slots you then can make an additional slot over and over as long as you use them. Plus this would allow people who say only want to ride something like Haunted, Buzz Lightyear, or Pirates to be able to keep making reservations for those rides if there are open return times instead of the 1 and Done Genie+ experience. People will still be upset about paying for something that was once free, but it would give people a closer experience to what they were used to with FP+.

I like these idea for genie/fast pass. I also think maybe they need to rethink the 7am aspect bc a lot of people dislike having to wake up that early - shifting even the 7am time would probably improve the experience for a lot of people. Iger - let us sleep in a tiny bit and still be able to get some lightening lanes lol.

 

[Mackenzie Click-Mickelson]

Sure I can. It may not have been obvious to the layperson, but someone like Bob Iger had access to the data that necessitated the closure of Shanghai Disney and could read the tea leaves from there. A lot of people, my husband included, were studying the numbers and saying by January that mass public events (like a work conference I had scheduled for that March) would be canceled and they were right. People who reached that conclusion so early in the pandemic may have been in the minority but so are people smart enough to ascend the top of the ladder of one of the biggest corporations in America.

Okay.........

Remind me to cue you in when I decide to play the lottery next

 

[cakebaker]

Okay.........

Remind me to cue you in when I decide to play the lottery next

Me too! I recall the time so clearly, because we had reservations that were going to start the day Disney closed. Our car was packed and we were ready to leave the morning after they announced they were closed. Conventional wisdom was a few weeks at most and Disney would be back up and running. I remember promising a crushed 9 yr old that it wouldn't be long, we'd reschedule in a few weeks -turned out to be well over a year before we'd go back. There was absolutely no one forecasting a long shut down- anything remotely like what actually happened not only at WDW but the entire country. Hindsight is 2020 as usual.

 

[wabbott]

Herewith, the Final Word from "The Newspaper of Record" (guffaw, guffaw). In all seriousness, I would pay a bit of attention to what James Stewart writes, as he is quite familiar with how DIS' world works. Remember, though, he's about to write another book.

https://www.nytimes.com/2022/11/21/business/media/disney-bob-iger.html
Iger’s Sudden Return to Disney Shocks a Discontented Kingdom
After Bob Chapek, the departing chief executive, tried to put a sunny spin on a disastrous earnings report this month, senior Disney leaders began talking about resigning.

• By Brooks Barnes, Benjamin Mullin and James B. Stewart

Nov. 21, 2022, 6:42 p.m. ET

After a transition to power marked by numerous setbacks, some self-inflicted, Bob Chapek seemed by early fall to have finally found his footing after two years as Disney’s chief executive.

The company’s board had unanimously renewed his contract, extending his reign until at least July 2025. In August, Disney reported stellar quarterly earnings, including a 50 percent jump in profit, passing Netflix for the first time in streaming subscriptions. At a Disney fan convention in September, Mr. Chapek pitched a rosy future for the company that included coming blockbusters like “Avatar: The Way of Water” and new theme park rides. “I’m very, very bullish,” Jim Cramer, the CNBC host, said on air about the company in October.

Then, in November, came Disney’s now-infamous quarterly earnings report.

Eye-popping losses in streaming. Lower-than-expected theme park profitability. Sharp challenges in cable television, including at ESPN. And yet Mr. Chapek inexplicably purred through an earnings conference call with analysts and investors, spinning the results as positive and offering gooey observations about Disney’s ability to sell “magical memories that last a lifetime.”

The report and call set into motion events that culminated on Sunday with the firing of Mr. Chapek by the Disney board and the surprise reinstatement of his predecessor, Robert A. Iger, as chief executive until December 2024.

It wasn’t just that some senior Disney leaders were aghast about the quarterly results and Mr. Chapek’s seemingly delusional delivery of them: Several began speaking openly about resigning if he remained in power, talk that swiftly reached the Disney board. Christine M. McCarthy, Disney’s well-regarded chief financial officer, directly told at least one board member that she lacked confidence in Mr. Chapek. “He irretrievably lost the room,” the leader of a Disney unit said on Monday.

This article was based on interviews with more than a dozen people, including Disney executives, bankers who work with Disney, investors in the company, and people close to Mr. Iger and Mr. Chapek, who all spoke on the condition of anonymity because of the shocking and sensitive nature of the leadership change. A Disney spokeswoman declined to comment, except to say Mr. Iger was unavailable for an interview. Mr. Chapek did not respond to requests for comment.

With investors fleeing Disney — its stock dropped 13 percent the day after the earnings report, the biggest decline since the Sept. 11 attacks — and Mr. Cramer of CNBC now openly calling for Mr. Chapek to be fired, the Disney board decided to push the panic button.

Susan Arnold, the board chair, called Mr. Iger, 71, at 3 p.m. on Friday and asked him to return.

At public events over the past year — and in conversations with confidants as recently as this month — Mr. Iger repeatedly insisted that he had no intention of returning to Disney. At the same time, Mr. Iger had for months been privately railing against Mr. Chapek, according to several people who spoke with him.

He lamented Mr. Chapek’s seeming lack of empathy and emotional intelligence, which resulted in an inability to communicate with or relate to Hollywood’s creative community. Disney seemed to be losing its soul, he confided to one associate.

Perturbed about Mr. Iger’s trash talk, which made its way back to Disney headquarters, the headstrong Mr. Chapek responded by icing Mr. Iger out — rather than turning to the more experienced executive for advice. Mr. Iger, for instance, never got a call for help when Disney was criticized internally and externally this spring over its approach to legislation in Florida meant to prohibit classroom discussion of sexual orientation and gender identity through the third grade.

This seemed to further annoy Mr. Iger, according to two people who spoke with him.

In Mr. Iger’s later years as Disney’s chief executive, he became, as longtime leaders tend to, more cognizant about his legacy. His tenure at Disney was almost unblemished. He led Disney to record financial results and engineered Disney’s acquisitions of Pixar, Marvel, Lucasfilm and the majority of 21st Century Fox, substantially altering the entertainment landscape. He successfully introduced the streaming service Disney+.

But the more Mr. Chapek floundered, the more Mr. Iger’s reputation also suffered. Mr. Iger handpicked Mr. Chapek for the job, believing that Mr. Chapek’s blunt, unsentimental business style would help Disney continue its transformation into a streaming superpower. According to three people briefed on the matter, Mr. Chapek was privately told that he was heir apparent as early as 2018, much earlier than initially realized, and so Mr. Iger had ample time to train him. The final piece of Mr. Iger’s legacy — a successful and smooth handoff of power — had been denied. It was embarrassing.

At the same time, Disney’s board was contending with a new threat from an activist investor. Earlier this year, Mr. Chapek and the board successfully managed to navigate a series of demands from Daniel Loeb and his Third Point hedge fund. This month, however, Trian Fund Management purchased more than $800 million of Disney stock and started pushing for its own shake-up and cost cuts.

Wall Street cheered Mr. Iger’s return. Disney gained $12 billion in value overnight, as shares jumped 10 percent on Monday morning. Disney executives, while shocked by the turn of events, were mostly thrilled to see him. (“Daddy’s back!” one male senior executive at the company texted on Sunday.) Other Disney employees wondered whether a Sunday night email from Mr. Iger announcing his return was a prank, one employee said, and texted their co-workers just to be sure it wasn’t a hoax. The Hollywood Reporter, a trade news publication, ran the headline “Bob Iger Returns as Hero in Waiting to Save a Battered Disney.”

But there was also a contingent that wondered if Mr. Iger had helped engineer a coup. Doug Creutz, an analyst at Cowen, told his clients on Monday that the development “gives at least some appearance that Iger, and not the board, ultimately calls the shots at the company, and that Iger’s willingness to fully surrender power to a successor is low.”

He added, “We do not necessarily believe that a lack of leadership is Disney’s problem, and think the change will ultimately make a true transition of power to Iger’s (next) successor even more difficult.”

There are senior executives at Disney who could be groomed into chief executive material, including Dana Walden, Disney’s television chief, and Josh D’Amaro, Disney’s theme park chairman. But neither is quite ready, a person close to the board said.

Two previous candidates to succeed Mr. Iger, Thomas O. Staggs and Kevin Mayer, left Disney and are now running a media start-up. A person close to Disney’s board had reached out to them this year when Mr. Chapek’s contract renewal was under consideration. According to two people familiar with the matter, this person posed a hypothetical question: Would one or both be interested in returning to run Disney? Any deal to bring them back into the Disney fold would have required the company to acquire their start-up, Candle Media, a multibillion-dollar firm that owns Hello
Sunshine, the media company founded by Reese Witherspoon, according to the people.

Mr. Staggs and Mr. Mayer demurred, the people said.

That left the board with only one serious option: Mr. Iger.

But he is not a long-term solution. At least a few board members believe they made an error with succession planning the last time — namely deciding that promoting from within was the only real choice. In announcing Mr. Iger’s return, the company said in a statement that he did so with a mandate to develop “a successor to lead the company at the completion of his term.”

Mr. Iger, who reached his deal with Disney on Sunday, has a compensation package that includes a base salary of $1 million, stock incentives expected to be worth $25 million annually and an annual bonus expected to be worth $1 million.

None of the big media companies have yet been able to figure out how to navigate past the collapse of cable television. Streaming services were once viewed as the solution, and still may be, but there has been a drastic shift over the last six months. The game is no longer about growing the number of global subscriptions at any cost; investors now want to see old-fashioned profit.

But Disney has one problem that its competitors do not, and it involves Mr. Chapek’s biggest move during his time as chief executive.

In 2020, Mr. Chapek restructured Disney to give priority to the company’s streaming services (Disney+, Hulu and ESPN+). He took away profit-and-loss responsibility from the executives who run Disney’s movie and television studios, and gave it to a protégé, Kareem Daniel, who was named chairman of a new division, Disney Media and Entertainment Distribution.

The loss of that turf — along with control over when and how films and shows would be released — upset longtime Disney executives, including Alan Bergman, the chairman of Disney Studios Content. Making the situation more touchy, Mr. Daniel had little experience in the vast area he was given to oversee. Mr. Chapek repeatedly insisted that his deeply unpopular reorganization was, in fact, the opposite, with “100 percent buy-in” from Disney managers.

Mr. Daniel’s division is notably the one that contributed the $1.5 billion in “peak” streaming losses for the recent quarter, up from $630 million a year earlier, surprising investors.
Mr. Iger ousted Mr. Daniel on Monday. In a note to employees, Mr. Iger said a new company structure was on the way that “puts more decision-making back in the hands of our creative teams and rationalizes costs.”

Mr. Iger faces other challenges.

A competitive frenzy has erupted around sports broadcasting rights, with Apple, Amazon and others driving up prices, which has hurt ESPN’s bottom line. Sports betting is viewed by some investors as the new streaming — a fast-growth master fix — but fully embracing that business could taint the family-friendly Disney brand.

Animated movies, the heartbeat of Disney, have started to struggle, with Pixar’s “Lightyear” bombing in June and “Strange World” expected to disappoint at the Thanksgiving box office.
A deteriorating U.S. economy could hurt attendance and spending at theme parks, where fans have already been upset over near-constant price increases.

Mr. Iger may well be able to quickly put Disney back on the right track, solving his legacy problem in the process. Or he may come to wish he had heeded his own words, spoken during a podcast interview this year when asked if he would consider returning to Disney.

“I was C.E.O. for a long time,” he said. “You can’t go home again. I’m gone.”

Lauren Hirsch contributed reporting.

 

[JZCubed]

Perfect example. Last year he patted himself on the back that "Park Guest Spending was UP!"

So while Disney pocketed more money, it wasn't because I chose to spend more money. That is a "false profit" that is not sustainable. Long term it isn't going to work out unless you bring in value to those prices.

Hopper, this is what has been my problem - the change in value proposition.

I would gladly pay more to get something that resembles more (or remained the same).

Of course, nobody is happy paying for Genie+ when it used to be free FastPass+, but if Genie gave my family what FP offered, it could be workable.

Unfortunately, once a family is prepared for the sunk-costs of traveling to Disney, Genie is a gamble that actually diminishes the value proposition - and that has nothing to do with monetary cost.

In addition to not knowing what attractions you're going to be able to secure until day-of, you have to wake prior to 7am and subsequently walk around with your phone to play the whack-a-mole for your next ride(s). For the increased costs of both time & money, too many families are getting a lesser Park experience. Making matters worse, that uncertainty adds pressure to preexisting dining plans.

So this is what we don't know - was this Chapek being too stubborn to adjust the functionality of Genie to increase guest satisfaction or is Genie simply unable to handle that adjustment? My guess, Chapek was stubborn.

Also, there used to be smaller add-ons that helped offer limited VIP access. For instance, my family enjoyed the early morning at Toy Story Land that included a buffet breakfast. We'd be done with the Parks by noon on those days and spend more time at the pool and preparing for a Signature dinner. Similarly, we paid extra for the Lion King package that included lunch/dinner at Tiffins along with VIP seating at Lion King show and semi-private Safari ride. Despite spending more money, these types of add-ons enhanced our guest satisfaction, while also limiting the time we spent in the Parks. These things no longer exist. Genie is the only game in town and it offers less functionality than FP. The advantage to Disney is one-time goers don't know the difference, but long-time goers now have far lower guest satisfaction. That's on Chapek.

People keep mentioning Park Hopping, but making Park hours longer would go a long way too, particularly if Disney offered some of the semi-private or smaller crowd add-ons. Of course, more Extra Magic Hours would also go a long way to increasing on-site guest satisfaction.

And my recent pet peeve has been the value proposition of the Star Cruiser. Let's get past that the hotel rooms look like the floating prison in Andor.....the immersive experience isn't immersive enough. Other than your hotel, there is little that can be considered immersive. Guests that are encouraged to be in their Obi-Wan costumes are effectively given a coupon to stand on the same line with everyone else for lunch in Galaxy's Edge. The light saber training does not include light sabers - you need it before you get there. Imagine being in Savis Workshop after-hours with just the hotel guests. Take it a step further - imagine stepping outside Savi's, dressed in your Obi Wan cloak wielding that lightsaber - alone with just the hotel guests. How about a Round of cocktails inside the Cantina with just the hotel guests. The value proposition just isn't there.....and that's on Chapek....

Too much of what I've outlined falls in line with what has been lost, not just to extract additional dollars from our pockets, but what has been lost by offering less of an experience for more money. Brand loyalty was gained by Disney being better than everyone else and that's been gone since Chapek took over - and has nothing to do with me spending more money. The Covid excuse wore thin when 40% increased spending was first announced last year. The impact will be felt in decreased brand loyalty and that hurts Disney in the long-run, at the expense of short-term profits.

Chapek lacked creativity at almost opportunity.

Further, the delusional earnings call where Chapek insisted that despite an additional $billion in losses, Disney+ would be profitable as scheduled by 2024 was a bridge too far. He offered no good answers. Heck, he lacked the ability to tell the story about how his team was going to make that happen - and he runs a company that tells stories to make their profits.

A competent CEO, like Iger, can sell you ice in winter. On the other hand, Chapek spun gold into something less valuable.

I'm not sure why the Board selected Chapek to begin with. Like you, I agree that the Board needs to look at themselves in the mirror. But Iger made the media component work buying Star Wars, Marvel & Pixar, so I'm reasonably confident he retuned with a vision on how to correct what has been troubling Disney since his departure.

Regardless, Universal has been getting and will be getting my vacation dollars. We will only return to Disney when the value proposition meets the costs. In the mean time, where I used to encourage other to go to Disney, that free advertising is gone. And by the comments on this Thread (and in the popular press), we're obviously not alone.

 

[TwoMisfits]

Sure I can. It may not have been obvious to the layperson, but someone like Bob Iger had access to the data that necessitated the closure of Shanghai Disney and could read the tea leaves from there. A lot of people, my husband included, were studying the numbers and saying by January that mass public events (like a work conference I had scheduled for that March) would be canceled and they were right. People who reached that conclusion so early in the pandemic may have been in the minority but so are people smart enough to ascend the top of the ladder of one of the biggest corporations in America.

China was in absolute brutal lockdown mode already in early Feb 2020. With Disney having so much riding in China, they knew that year was gonna be bad, and they knew it right then. So, yes, Iger did know a lot about what was gonna happen. Maybe not the entire thing, but he knew enough that it was gonna be a brutal year, necessitating cuts and unpopular decisions people wouldn't like, so it was a great time to get while the getting was good.

 

[DCLMP]

Bob Iger led them through the last recession so maybe he's the best one to lead them through this one.