Bloomberg: Disney Is No Longer Building an Empire, But Selling Its Asset In a "Yard Sale;" Bob Iger in Damage Control Mode as Employees Freak Out About Fire Sale

Yes... yes... Die, Maus, Die.

Bob Iger Shifts From Building an Empire to a Disney Yard Sale

Netflix just had its best month in years and Disney is looking to sell its TV assets. What does that mean for the future of Hollywood?

Bob Iger built Disney into the world's most powerful entertainment company by acquiring Pixar, Marvel and Lucasfilm. Now he's looking to downsize.

Iger put roughly a third of the company up for sale this week, declaring Disney's linear TV assets noncore. That includes TV networks ABC, FX and Freeform. He also said Disney is looking for a strategic partner for ESPN -- though he's not willing to sell the whole thing -- and the company is already looking to sell or restructure its TV and streaming business in India.

It's a stunning if inevitable turn of events for an executive who spent so much of his career working in TV, and for a company that relied on cable networks for the majority of its profit. Before the pandemic, Disney's media networks generated 35%, or $24.8 billion, of company revenue and more than 50%, or $7.5 billion, of its operating income.

Yet the accelerating decline of cable TV has limited Iger's options. He thought he'd solved this problem with Disney+ and Hulu, his two mass-market streaming services. But his streaming business is expected to register a loss of about $800 million in the company's just-ended third quarter.

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Rumors have long swirled that Iger will end up selling all of Disney to Apple. It's still hard to imagine Iger selling Disney to anyone. He was always a builder -- not a seller. But Bob the builder is doing a lot more cutting this time around.

The Wall Street Journal reports that Bob Iger reports that he's "stressed" at the task of saving Disney from his own catastrophic choices.

But actually he blames everything on Bob Chapek, who barely did anything in the two years he was nominally CEO, with the former CEO Iger sitting on the board overseeing his decisions. (And demanding that Chapek reverse his first instinct of staying out of the Gay Culture War fight with Ron DeSantis.)

Iger has described himself to associates at recent private gatherings as stressed from cleaning up a mess that is more extensive than he realized. At the office, he joked in one meeting that it was the wrong time to come back, according to people familiar with the matter.

Since returning, Iger, 72 years old, has strained to put out fire after fire, from accumulating losses in the streaming segment to a steep decline in Disney's traditional television business. He has clashed with the company's CFO and an activist shareholder.

The company is in the midst of painful layoffs and budget cuts. Crowds at Disney's Florida theme parks thinned during summer holidays. Its Pixar animation studio continued a yearslong box office slump.

A YouTuber said that the official wait times reported by Disney's own app over the Fourth of July weekend were only five minutes for many of the parks' rides -- and "five minutes" includes the time to just walk to the ride and get seated on it. In other words, many rides had no wait times whatsoever.

And that's unheard-of in Disney parks.

Iger's doing alright for himself, though:

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Since returning to the CEO's office in Burbank, Iger has shown visitors a model of one of his yachts and enthused about the new superyacht he is building. The boat is expected to be 30 feet longer than Iger's first superyacht, the 180-foot Aquarius, and built by the same Dutch custom shipbuilder Royal Huisman. Superyachts of that size and level of luxury can cost tens of millions of dollars, according to yachting experts and published sales listings.

You know who's really stressed about Bob Iger selling off parts of Disney so he can conceal the destruction of value in the units he purchased -- Marvel, LucasFilm, and Pixar?

The employees who will be terminated in a sale.

Disney's Bob Iger was forced to do "damage control" after spilling plans to possibly sell all or part of money-bleeding channels ABC and ESPN, The Post has learned.

Iger, who last week got a two-year extension to run the company after retaking the reins last year, huddled with senior leaders of Disney's TV properties on Tuesday, according to a source with knowledge.

"Iger met with senior leaders of the television group and reaffirmed his commitment to the value of the business and also ABC News," the source said, adding that he was doing some "damage control" and "reverting back to the previous talking points."

The meeting came days after the Disney boss made some uncharacteristically candid remarks to CNBC's David Faber, in which he said Disney's traditional TV business "may not be core" to the entertainment giant.

Among his comments was that Iger would be open to finding a strategic partner for ESPN.

Here's a strategic partner for ESPN: My dick.

Rumors have also swirled that he may spin off ABC.

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The source said Iger's "undisiplined, off-message" remarks last Thursday sent "shock waves" through Disney, which along with ABC and ESPN also owns FX and National Geographic.

The head honcho told CNBC last Thursday that he did not anticipate the degree to which legacy television networks would be struggling, and that he would be open to selling or spinning off Disney's cable networks.

Because it's the leftwing, Marxist-and-yet-incredibly-self-centered-and-greedy "news" media that will make the most noise, Iger reassured ABC "News" that they're super-important.

"I'm ridiculously passionate about news," Iger said, according to the person familiar with his comments.

"It's important to this company," he added, citing the importance of ABC News to Disney. "We need to figure out how it makes the transition into streaming. And I happen to believe we will endure. It's too good, it's too important, and it's really fun."

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"It's great to say he loves the jewel. It's great to say that the jewel is important. It's great to say that the jewel is fun," the insider said. "But he has revealed the truth: He wants to get the highest price he can for the jewel because he can't afford it anymore."

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"Everybody has known for some time that the linear TV networks [I think this means non-streaming TV networks] were declining," the source said. "I think he gave voice to something. He has to transform the business and get rid of parts that are not performing or that are dragging them down."

I'm loving hearing that all broadcast networks are "struggling" and "declining."

Update! WDW_Pro notes that an analyst estimates that LucasFilm has lost 75% of its purchase value under Kathleen Kennedy and Bob Iger.

Oh wait -- he's just quoting me for that 75% figure.

That was just an guesstimate. But I imagine that's close to accurate.

And this is a bit of circular reporting, to be honest. I got the idea that Iger could not sell the units he drove into the ground because it would demonstrate that they had declined so much in value, and this in turn would reduce Disney's value as a whole, from WDW_Pro. The 25-50% valuation is just a guess. What could LucasFilm be worth now? Its assets are 1, its IPs, and 2, its employees and the contracts with them. But its IPs are now very damaged, falling from A-tier to B-tier at best for Star Wars. The Mandalorian fell apart season 3, Boba Fett was a joke, Obi-Wan was a joke. Andor was apparently okay but I hear it was also pretty boring and besides, almost no one watched it.

And what is Indiana Jones worth now? It's no longer an A-tier franchise. The time to recast and set a movie in the 30s again was when people still liked the franchise. Disney can try that at some point in the future, but who will still care?

I was the world's biggest Indiana Jones fanboy. I still love the trilogy. But I can't get excited for a new, schlocky Disney exploitation of the franchise. I don't know that I'd bother to see it when it becomes free for me on Amazon.

What would someone pay for these IPs, which costs a huge amount of money to make content for, but which don't 't deliver proportional returns? Disney hasn't made a Star Wars movie since 2019.

You don't let an IP lay fallow for years if it's still a money-maker. If Disney doesn't have confidence in the Star Wars IP generating income in movies, that's a sign that it's an IP in crisis. They know the value of their own IP, and they're signalling that value is not high.

Kathleen Kennedy keeps talking up the Hypothethical Star Wars films "in development," but development is a relatively cheap thing. Pay some scribblers to write scripts, maybe pay a few artists to come up with some designs. The real costs come when you go into production -- and Disney, wisely, is avoiding putting an actual movie into production.

But they'll pay people $100,000 to write a script. That's folding money for Hollywood.

How much of Star Wars licensing value is left? And how much money is there in licensing out the IP for comic books and cheap genre novels? No one has ever thought those as huge revenue-streams.

As for the value of its employees -- they're trash. They're an impediment to value. You'd have to fire them all before you could even contemplate a turnaround, but you can't fire them because they're Wokies who would start leaking to the press about how LucasFilm is now Racist and Hates Women and is Literally Erasing Trans People.

So they damage your brand if you keep them, and they damage your brand if you fire them.

So loads of ABC and ESPN and FX employees will be laid off in a sale to keep Disney solvent.

But meanwhile, Kathleen Kennedy and the "Diversity, Dinosaurs, and Diversity" LucasFilm "story group" all still have their jobs, guaranteed for life.

posted by Ace at 02:17 PM

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