There was a shotgun wedding in Philadelphia last week.
Michael Eisner and George Mitchell got hitched.
A mere six hours after 43 percent of Disney stockholders withheld their support of the embattled Eisner, the company famous for its dysfunctional family sagas made Mitchell Chairman of the Board and left Eisner CEO. You can almost see the wedding photo: “Michael? Hold the knife closer to the cake! Don’t hold it that way, Michael! Okay, smile!” It was a quick fix for a company swarmed by stockholder discontent and a slap to Eisner but basically it’s a holding action. Yes, Eisner lost the chairmanship of Disney, but Mitchell is considered an Eisner ally. So it’s a draw.
The rebels, led by Roy Disney, and another ousted board member Stanley Gold, hoped to remove Eisner in much the way that President Aristade was removed from Haiti -- by the will of the people and with a little help from the U.S. government -- in this case the SEC. Roy, nephew of Walt Disney, son of the “business side” of the two great brothers, has righteous indignation on his side. Yes, profits have been shaky at Disney in the past couple years, yes, we’re all sick of Lilo & Stitch merchandise and California Adventure (the Disneylgiveand white elephant they can’t away). But it all started with Roy’s firing. Mandatory retirement age from the board of directors is 72. And when Roy turned 74 in November and was unceremoniously dumped, he started talking about “magic” and how it’s missing from everything Michael Eisner touches. “Branding is something you do to cows,“ Roy has said lately. “It makes sense to ranchers. Branding is what you do when there’s nothing original about your product.”
Of course this discounts the fact that Mickey Mouse was arguably the very first brand. And Uncle Walt invented it.
Roy has made less appropriate statements to rouse the “Trekkie-like” stockholders. “If we had enough rifles, this would have been over a long time ago,” he said last week.
But the theme he has been hitting the most, the gripe that has become the mantra on his website to rile up the Disney geeks is Roy’s desire to: “Bring back the magic!”
I don’t know what Michael Eisner is like in the company boardroom, but his magic is underrated. Eisner didn’t get where he is by being a “suit” but by knowing filmmaking better than anyone in the business. Want to know what’s wrong with the movie? Want to know how to fix the story? Want to ask someone who’s right 99% of the time?
Ask Michael Eisner.
How quickly we forget what Disney was like pre-Eisner. I do. I remember very well when it was announced that Eisner and Katzenburg were taking over Disney and across the board it was thought of as an all time loser idea. Disney was in poor shape at the time. A film vault in sun-baked Burbank. Yes, everyone agreed, they had the library, but the “magic” was way gone. There were tumbleweeds blowing through the Buena Vista gate. They were making Tron for chrissakes; and the animation division was hoping to live up to second string efforts like Jungle Book. Remember Black Hole? Remember Black Cauldron? If there was ever a time to “bring back the magic” it was then -- when Roy Disney lobbied to hire Eisner.
And back then, Roy did the right thing. Part of the problem of protecting the integrity of the family brand was that it had become stifled by toomuch respect. Asking “What would Walt do?” had become a no-win proposition. Walt wasn’t around to answer. And even if he were, there’s no guarantee that he could have swung with the times to insist on needed change. What was needed was some new blood. Someone not so concerned with the “traditions” of the company. Someone who wasn’t afraid to break up the furniture if they had to.
At its zenith in the mid-‘90s, the Eisner-Katzeberg-Wells wave was lapping at the tippy-top of the shore. The only thing black was the ink. Profitable? Way. Eisner had re-discovered the magic for sure. The Disney name meant family entertainment again. And “brand” was a good thing. Can anyone tell us what a “Universal brand” or a “Paramount brand” consists of? Eisner had re-established quality with Beauty and the Beast, Aladdin and Lion King and revived the theme parks. So maybe that’s what Roy means by “bringing back the magic,” not Walt so much as that of mid-‘90s Eisner?
This is not to say that Eisner hasn’t made mistakes. Want a list? Let’s see. Did I mention California Adventure? How about the Ovitz debacle? How about Treasure Planet? How about losing Pixar? (though that was kind of pre-ordained) And yes, Roy does have a point about the company’s honoring of creativity. Ask anyone who works for Disney and they’ll tell you. They’re cheap at Disney. Animators get laid off without remorse. A lot of people still call it Mousewitz.
And yet, of all the times to lead a revolt, Roy picked a bad one in terms of the balance sheet. Park attendance is up 14% this quarter over the same quarter last year. Disney stock has risen 60% since January 2003. Profits are expected to increase 30% in 2004 with double-digit growth by 2007. It makes it difficult to rouse the torches and pitchforks crowd.
So all Philadelphia has left Disney with is a marriage of uncertainty. I talked to one Disney insider who stated flat-out that the company is in limbo. And if Eisner doesn’t do something to move off the state of inertia, all those profits may not materialize on schedule. So what can Eisner do to reinvigorate the place, and appease the Disney fans who want his head? Well, here are a few things he might try:
1. Blow up California Adventure!
“Daddy? Where do bean sprouts come from?”
“Well, son, let’s go to California Adventure and find out together.”
It’s true. Ask anyone. The bugaboo that irritates fans the most is the California Adventure Theme Park. Paring down the Imagineers’s glorious plans for Disneyland II, Eisner short-changed everybody. They have three good rides, with Tower of Terror they may have four, but in the meantime, why fly to California to experience faux California? A friend of mine likes to stand between this boondoggle and Disneyland proper and compare the two by saying: “Built by an agent... Built by a genius.” So why not just level it and start all over again? Kind of like the guys who bought the fly ball that doomed the Chicago Cubs in order to grind it to pulp and exorcise the demons of failure. Hell, Roy Disney likes guns so much, invite him to push the plunger! Make a day of it!
2. More films about dysfunctional families!!
Bambi’s mother gets killed, Simba’s dad gets killed, Aladdin’s an orphan, Snow White lives with seven men with rapper names (“S’up, Sleepy?”). Disney friggin’ invented the dysfunctional family. And there hasn’t been a real hit in this new franchise arena in a long time -- and no Lilo & Stitch does not count. Where’s that new fairy tale, where’s -- I hate to say it -- Shrek? Maybe Roy’s got a point, how ‘bout some likeable characters? How ‘bout going back to those dysfunctional family standards and coming up with a new animated franchise? How ‘bout Michael ‘n’ Roy: The Movie.
3. No More Theme Park Rides Turned Into Movies!!!
Pirates worked, but Haunted Mansion and Country Bears did not. So stop already. What’s left? Main Street Trolly: The Movie? This idea used to be verboten at Disney and might be subtitled “When good vertical integration goes bad.”
The SEC will decide this year about stockholders’ rights to name members to the board. Stay tuned, Mouseketeers!