Disney’s new CEO, Bob Iger, must solve the problem he created

Disney’s new CEO is the original CEO. Chapek left, with the return of Bob Iger, who ran the company for years and handed over the company to Lieutenant Bob Chapek in 2020.

This news is great news for those working in Hollywood and Silicon Valley. Normally, if you’re not in technology or media, it shouldn’t mean anything. But this is different. It’s a move by executives who speak volumes about the state of the media industry as they try to understand how to adapt to the dramatic changes that technology has brought to the way we consume media.

There are many theories as to why Chapek was activated, all of which may have some degree of truth. The two men reportedly had a strained relationship throughout Chapek’s brief tenure. Chapek upset Hollywood by openly fighting Marvel star Scarlett Johansson over money. Perhaps most importantly, he demoralized Disney employees with his clumsy way of dealing with Florida Governor Ron DeSantis’ attack on the company. (there were many other Scratches on the head when the Eiger left 2-3 years ago. )

But the most important thing to understand about Iger’s return has nothing to do with Disney specifics, it has to do with the media industry in general. When Iger left Disney, everyone in the media was trying to be Netflix — booming, all-in on streaming, willing to burn tons of money to make it work — that’s what Wall Street was Because that’s what I wanted.

Now Wall Street has changed its mind. This is why Disney’s stock has plummeted, along with most major media companies’ stocks, including Netflix. Disney stock was worth nearly $200 to him in Spring 2021. Half that after investors surged after Iger’s return was announced this morning.

“Things are very different from 18 months ago,” an executive at one of Disney’s competitors texted me. “Hopefully he can figure out the model. Nobody has one yet.”

A New Theoretical Model: Figure Out How to Create a Streaming Service That People Pay For, But Don’t Spend Huge Dollars — In the Last Nine Months, Disney Lost Over $2.5 Billion in Streaming, Plus $1 Billion a Year I’m losing While continuing to support established businesses that make big money but are perpetually in decline, like cable TV.

So, on the one hand, Iger will find himself in the same boat as the rest of the industry. Comcast, Warner Bros. Discovery, and Paramount all grapple with the same problem and the same investor skepticism.

On the one hand, he’s the man who launched the boat first, so there’s poetic justice here. announced that it will create a competitor for Netflix. Rupert then purchased much of his Murdoch’s 21st Century Fox, based on the theory that it would take a lot of movies, TV shows, and their associated intellectual property to compete with Netflix. doubled.

Investors cheered at all of it, even when Iger told them it would lose billions of dollars. rice field. Iger said he launched Disney+ in the fall of 2019 to enthusiastic applause. A few months later he declared that his work was done and left.

It turns out that Iger still has a lot of work to do, but I’m still guessing what it will be like. Maybe he just needs to back up his army while indulging Wall Street, who adores him, analyst Michael Nathanson wrote in a note this morning. Perhaps he’ll figure out how to tweak Disney’s content, which has been welcomed over the years that have dominated world culture with products from Marvel, Star Wars, and Pixar.

Or maybe there’s a big, glorious structural move underway that either transforms the company, or makes people think it has. There may be other things to buy — Netflix, for example. One of the stories. Mashnotes Netflix founder Reed Hastings addressed to Iger on Twitter Last night. )

A word of caution on that note: The three acquisitions that Iger transformed the company in are deservedly celebrated (Pixar, Lucasfilm, and Marvel), but they were all acquired within a few years of each other.

For example, it is quite reasonable to claim that Iger dramatically overpaid for acquired Fox assets. And Iger was very close to buying both Vice and Twitter.

While the media industry loves Iger (on my version of Twitter last night, people were overwhelmed with themselves explaining how excited they were about his surprise return), that in itself is a risk. is. If Iger didn’t approach Disney, everything that happened to the company could be attributed to the failure of his successor (never mind that Iger chose that successor). Now, if he can’t figure out how to fix the problems he’s caused, some of his own reputation could be at risk.