Disney Does It Again!

[Furious D]

In Michael Eisner's continuing quest to alienate everyone who makes hit movies for Disney I just heard that Pixar and Disney are splitsville as soon as their contract's up.

Pixar chafed under the original 50-50 profit-sharing deal, and disliked Disney's total control over sequels and marketing. Although the plucky computer animator has kept the Magic Kingdom afloat for the past few years with hits like FINDING NEMO and TOY STORY Disney just didn't think they were important enough to negotiate a better deal.

I've read quite a bit of recent Disney history and it's seems to be that they set up a relationship with stars, filmmakers or even their own executives that put out some hits. Then when these people offer to continue the relationship for a slightly better deal, the Mouse tells them to go pound sand.

This doesn't bode well for the house that Walt built.

Once it was the plucky little company that produced family entertainment under Walt's leadership. Sadly, this wasn't very profitable and the company was the brink of bankruptcy pretty much throughout his reign.

Then in the 80's it became a success with a string of low-budget PG & R rated comedies under its Touchstone label. People hailed Eisner as a genius and the saviour of Disney.

Then in the 90's it became a symbol of everything wrong in Hollywood. It started buying up smaller companies, forming extra divisions to produce more & more formulaic films on a scale no one had seen since the heyday of the studio system, and it also started driving away people that were key to its successful revival.

The Disney brand, which once meant innocent entertainment, had changed into a symbol of corporate gluttony alienating parents, and kids alike with their marketing overkill. And don't get me started on the whole Michael Ovitz debacle.

Is this the beginning of another slow decline in the company's fortunes? Walt's nephew Roy thinks so. Before being driven out of the former family business he called for Eisner to resign. Kind of an interesting twist for the man who originally helped Eisner become so powerful to begin with.

Is this a case of Eisner believing his own hype and thinking his every brainfart and whim is a stroke of genius? A lot of people think so.

What do you think about these developments?

[El Duderino Diablo]

Screw Disney. Thanks to them I can't even get an $8 (CDN) bootleg of God of Gambler's Return on DVD. Those fucking fucks.

[Bongwater]

Pixar's contemplating a traditional animation house as well. Take that Disney.

Maybe in 20 years, when Pixar owns ABC and ESPN... :D

[Rory L. Aronsky]

May happen soon. One name that's been floating around to replace Eisner if he's ousted: Steve Jobs. Seems simple enough. Jobs takes over, brings Pixar back in. At least there'd be an improvement if he was running the company. Ok, I know Apple's had its problems, but he's better than Eisner.

[Furious D]

Originally posted by Rory L. Aronsky
May happen soon. One name that's been floating around to replace Eisner if he's ousted: Steve Jobs. Seems simple enough. Jobs takes over, brings Pixar back in. At least there'd be an improvement if he was running the company. Ok, I know Apple's had its problems, but he's better than Eisner.

Sadly that seems unlikely. Eisner has control of too much Disney stock, it would take a thermo nuclear strike to dislodge him from his office now.

Disney also seems to shutting down its traditional animation section and laying off hundreds of artists. Apparently no one will pay money to see 2D animation on the big screen, but it's wildly successful on TV.

Now if Pixar was to sign a deal with Dreamworks I think Eisner will have a conniption that would rattle Space Mountain.:p

[Rory L. Aronsky]

it would take a thermo nuclear strike to dislodge him from his office now.

Thermo nuclear strike you say? This might be easier than I thought! Hmmmmm.....

[Peter_Lowry]

It's over between the two studios. To prove that I present the following that was posted on the International Movie Database a few days ago...

Jobs Joins Eisner's Enemy List

Pixar Chairman Steve Jobs has sharply criticized the Walt Disney Co., calling the Disney animated features Treasure Planet and Brother Bear duds and the sequels Return to Never Land and Lion King 1 1/2 "pretty embarrassing." He maintained that there had been little creative input from Disney on Pixar's hit films "for years." Jobs made the comments in an interview with the Los Angeles Times and during a conference call with analysts in which he announced that Pixar had recorded record profits for the fourth quarter and for 2003. He said that it had earned $83.9 million for the quarter and $124.8 million for the year. Jobs, who broke off negotiations with Disney to extend its distribution deal, said that he has heard from every major studio in Hollywood since. He told the Times that he expected to begin formal negotiations with them next month, adding that it was "very unlikely" that talks with Disney would be revived. A Disney spokesperson responded that it was "sad and unfortunate that [Jobs] has resorted to insults and name-calling in the wake of the disagreement."

Oh yeah, the Disney/Pixar relationship is officially over. Disney will have to move on without Pixar, but I doubt the company will be the same without this amazing animation studio. It's a huge loss for the company that I think will take Disney a least a decade to recover from.

Peter

[Geo]

I have been a die hard Disney fan since childhood. Throughout my life I have studied the history and the people behind the name. There have been many issues with Disney in the past, but none like this. Eisner has turned the company into something that shows nothing of its creator.

Walt was many things, a megalomaniac for one, but he was visionary. Throughout his life he was always Johnny on the spot when it came to anything new. From talkies to color to 70mm to surround sound, Walt was doing it before anyone. Walt was not in business to make money and in fact he bottomed out and when almost bankrupt more than once. He was all about pushing forward and riding the wave of technology and new ideas that pushed us into the 21st century. The Walt Disney Company, although it had had some commercial success, was never commercial. Walt would constantly bet all he had on something new, and he would take whatever came from each success and put it down on the next idea knowing full well that it could flop (and many did). Walt hated doing the same thing twice and refused to produce any sequels. He did many questionable things (and many that were just flat out wrong), but he never ever sold out.

Eisner, Eisner Eisner Eisner. The former head of Paramount was hired during a time when the company needed direction. When Walt ran the shop he did things for himself, not for commercial success. When others tried to be as creative and visionary, they failed to meet with the challenge and produced forgettable dribble. The studios failures lead to the point where almost all company profit came from the parks, over 50% did and when tourism was down the company would bleed. Eisner stepped in and changed the company to be commercially viable. He expanded the studios and the themeparks and he made wise business choices so that the parks took the same size piece out of a bigger pie, dropping to only 25%. He always had a thorn though, and that was the animation studio. He had the original studio building demolished to put up his office. He cut the budget back to almost noting and gave no assistance to the animation house.

Then something funny happened. Walt Disney Animation paid nothing and was a terrible place to work, the red headed stepchild of Eisner's Disney. The Animators that worked there and that had stayed did so for their love of Disney Animation and not for money (cause there was none to be had). Like Walt, they were interested in making something new and cared very little about weather or not it would sell, and they had more than just love- they had great talent. There were three films in production at the same time that were both the savior and doom of Walt Disney Animation, The Little Mermaid, Beauty and the Beast, and Aladdin. Because of the commercial and critical success of these films, Animation then caught the attention of Eisner. With no regard as to the creative process, and with an admitted dislike of the animation industry, he stuck his big fat fingers in because it was making money and lots of it. Soon, its profit margin would drop due to his intrusion but not without one last spike in profit. The Lion King seemed to vindicate Eisner's involvement and suddenly he was all over animation (but never officially in charge of it, he just stuck his fingers in all the time).

Now sequel after sequel and 2 hour commercials are all they produce. It got so bad that David Stainton (Feature Animation president) hired a Feng Shui consultant to redo the studio because ideas were so stagnant. Now Eisner is vindicated again, and his original dislike of animation comes full circle. Now he dropped an axe he didn't drop in 1990 like he planned, he squeezed the life out of it for every last dollar before the kill. Gone is the thrill of new discovery, gone is the energy of riding the creative edge. It will take another dreamer to recreate what Walt did, and they don't come around often in this world. He may have been the last.

David Koenig's site:
http://www.mouseplanet.com/david/dk030814.htm

[Furious D]

I heard a story about Harlan Ellison working at Paramount during the Eisner years there. Eisner had got a friend who was a production designer to take the job as VP of Development. This new and completely inexperienced VP's job was to get the Star Trek movie franchise started.

Creator Gene Roddenberry was stumped on a decent script so he asked friend Harlan Ellison to come up with something. Paramount's criteria was that it must involve the original cast and it had to be BIG!

Ellison wrote a script involving evolved dinosaurs who seek to reclaim Earth 60 million years after they left it. In a huge battle humanity is destroyed, all except the Enterprise. Kirk is then faced with the fact that in order to save humanity he has to go back in time 60 million years and destroy them before they can become a threat. According to sources it had everything the studio wanted. Big battles, big moral choices, and lots of big special FX.

Eisner's new VP read the script and said that he loved it, but had just read "Chariots of the Gods." That book claimed that aliens had visited the Aztecs, so the New VP insisted on including Aztecs in the script, even though the events predated human evolution, let alone the rise of the Aztecs.

Eisner backed the VP and Ellison told them both to get stuffed and walked out. The script that everybody involved had wanted to do was permanently shelved.

Another Ellison story involved his brief time at Disney in the late 60's. He started his job there at 9:00 AM and was fired by 12:30 PM. Ellison entertained some friends at the studio commisary with his version of a Disney Porno, and he imitated all the voices. Roy Disney overhead this and by the time lunch was over, Ellison's stuff had been moved out of his office and they had painted over his name in his parking space.

[Furious D]

Cable behemoth Comcast is making a hostile takeover bid for bloated entertainment Goliath Disney. The price $54 billion in cash and the assumption of $11 billion in Disney debt.

Is this a good thing, is it a bad thing? Let me know what you think!

[Geo]

I'd have to say bad. At least if it's its own company there is a slight hope that another miracle could happen- if it's an asset of another company then it's only purpose it will ever have would be commercial. The ray of hope is like a flashlight from orbit, but at least there's that.

[Ellen M.]

I just saw a piece on a news magazine show about how Pixar has really raised the bar with the success of "Finding Nemo", and that CG animation will now pretty much replace hand-drawn animation (at least for movies). Good for Pixar, bad for Disney!

Disney's certainly had quite a roller-coaster ride over the last 10 years. I think a Comcast buyout will only mean further "corporatization". It's kinda sad really. Eventually there will be only one bank, one phone company, one TV station & one movie studio... all run by the same U.S. mega-corporation.

Big brother mouse is watching!
Ellen

[Furious D]

I wonder what it's going to do Disney's 'Prestige' brand Miramax?

Old Harv's company's become a shadow of its former self. It's now best known for shameless Oscar campaigning for undeserving films and buying up indie and foreign titles and then shelving them, sometimes for years. They went from films like PULP FICTION to doing Meg Ryan romantic comedies and flicks with Ashton Kutcher.

What will the high mucky-mucks at Comcast do with the little company that just became too damn big for its britches?

[The Baron]

Eisner Now Just CEO of Disney
Board Splits Top Position, Names George Mitchell Chairman
By GARY GENTILE, AP

PHILADELPHIA (March 4) - Frustrated Disney shareholders spoke with a loud voice, and the company responded by stripping CEO Michael Eisner of his chairman's title - a move unlikely to quell the grumbles among many of the 43 percent who voted to withhold their support for Eisner.

Disney's board met late Wednesday and voted unanimously to sever the roles of chairman and chief executive, naming director George Mitchell as nonexecutive chairman. Eisner is keeping his job as CEO, and the board reiterated its approval for his leadership and the company's strategy.

Yet the change in management structure came only hours after a stunning number of Disney shareholders - nearly half - did not support Eisner's re-election to the board.

Major institutional shareholders have been critical of Eisner's autocratic management style and what they say is a subpar record of creating value for Disney's shareholders over the past several years. They also want Eisner to be more accountable to the board of directors and a clear succession strategy put in place.

Although the action curbs Eisner's control over Disney and addresses the concerns of corporate governance groups who had called for the change, it won't satisfy the company's most vocal critics, ex-board members Stanley Gold and Roy E. Disney. The men have vowed to continue their fight to oust Eisner.

In an interview with ABC's ''Nightline'' program Wednesday, Eisner, 61, acknowledged the vote against him: ''I do not belittle a large withhold vote.'' He also portrayed the jobs split as the result of wider reforms in corporate America.

''We should have been considering, and getting our company into contemporary governance and we did it today. We heard our shareholders who seemed to be interested in that, so we went ahead and did it,'' he said.

''And there are obviously certain people that are not happy with me personally, I guess,'' Eisner added.

Mitchell, a former senator from Maine, may also prove to be a controversial choice. Shareholders withheld 24 percent of their votes from his re-election Wednesday - the second highest total after Eisner.

Mitchell has been criticized by Gold and Roy Disney as being too close to Eisner and not independent enough because his law firm had worked for Disney in the past.

Early investor reaction to the changes was positive but muted. Disney's shares were up 17 cents at $26.82 in morning trading on the New York Stock Exchange.

In its statement, the board said it understood that investors were concerned about more than just the issue of separating the chairman and CEO positions.

''We are aware that some voted for an immediate change in management and in the board,'' the statement said. ''However, taking all these factors into account, we believe the action we have taken today is in the best long-term interest of the shareholders of the company.''

Institutional Shareholder Services, a proxy advisory firm that had recommended its large investor clients withhold their votes from Eisner, said the Disney board's change was welcome, but insufficient.

''If the Disney board believes this is the silver bullet to fix all the problems, they are sort of mistaken,'' said Cheryl Gustitus, an ISS spokeswoman. ''The level of the vote makes it clear that investors have a lot of more on their minds than just the splitting of the position.''

Earlier Wednesday, the nation's largest public pension fund, which withheld its 9.9 million votes from Eisner, called for his resignation.

''This discontent is too wide and way too deep in the marketplace, and it has led us to believe that Eisner should go and the board should get quickly to work on planning for an orderly transition,'' said Sean Harrigan, president of the board of administration of the California Public Employees Retirement System.

Also Wednesday, Disney's board rejected a renewed overture from cable television giant Comcast Corp., saying it would serve no purpose to reconsider an offer already dismissed as too low.

The board's action followed a long shareholders meeting marked by cheers and standing ovations for former board members Gold and Roy Disney, who have waged a bitter three-month campaign to oust Eisner.

The two hailed the vote and said it was a clear indication Eisner should go.

Shareholders, following the advice of Roy Disney and Gold, also withheld more than 20 percent of their votes from two other board members: Judith Estrin and John Bryson.

Analysts had said that in the face of the votes, Disney's board either had to split the chairman and CEO jobs, do nothing, or fire Eisner, who has served as Disney's chairman and CEO since 1984.

Eisner, who chaired the meeting, showed little emotion, even as Gold and Roy Disney took the stage and called for his firing.

His voice a bit hoarse, Eisner briefly defended himself and his fellow managers, saying he enjoyed an ''excellent relationship'' with the dissident board members until they disagreed with his handling of the company after the Sept. 11 terrorist attacks.

''Stanley felt we weren't listening,'' Eisner said. ''We felt we were listening and not agreeing.''

''I love this company,'' Eisner said. ''The board loves this company. And we are all passionate about the output of this company.''

Eisner acknowledged that the performance of Disney's ABC network was ''disappointing,'' but he also told shareholders that Disney has ''the management skills and creative talent to continue its growth path.''

Gold and Disney went slightly over the 15 minutes they were allotted at the meeting to present their case against Eisner, saying it was not sufficient for the company simply to split the roles of chairman and CEO.

''Michael Eisner must leave now,'' Gold said. ''We see today's meeting as a first step toward saving the company. ... We are seeking real and meaningful change.''

Eisner defended his management team: ''The criticisms you have just heard are fundamentally wrong,'' he said to applause. ''I believe you have just heard rhetoric from our critics that frankly replaces reason. It's a disservice to cast members as well as shareholders.''