The Mouse That Roared

Five years into the job, Disney’s Iger finds his voice

Disney CEO Robert Iger spent March 7 rolling deep at the Oscars with his friend and biggest shareholder, Steve Jobs.

If Iger seemed outwardly cool—and he almost always does—it had to be a tense night for him: Disney-owned ABC and Cablevision were locked in a contract standoff that threatened to prevent Cablevision subscribers from seeing the Oscars. Cablevision serves Long Island, where Iger was born and bred, and the looming blackout meant that his own parents and sister were among some 3 million viewers who wouldn’t be able to see the Oscar broadcast on WABC.

A deal, of course, was ultimately struck, and the ABC feed was restored some 20 minutes into the show. It was quite a display of brinkmanship, and it’s hard not to conclude that Iger used the Oscars to exert maximum leverage.

All in all, it was a good night for Iger: Up, the animated movie from Disney-owned Pixar, took home the Oscar for best animated film, and the ratings for the awards were the highest in five years (despite reviews that were mixed, at best). That same weekend, Tim Burton’s rendering of Alice in Wonderland for Disney recorded the biggest 3-D opening yet, nicely riding the coattails of Avatar and giving hope that the company’s slumping movie studio might have better days ahead.

Iger’s approach has been a pragmatic, almost clinical lesson in how to run a media giant in the 21st century. He made big waves in Hollywood a few months ago by replacing Dick Cook, the longtime head of the Disney film studio, with Rich Ross, one of the executives responsible for the success of the Disney Channel. Less noticed has been the fact that, in all, half of the dozen people who reported to Iger a year ago now either have new roles or have left the company.

He is in the process of selling off the library of Miramax, the indie-film arm of Disney that for years brought it Oscar accolades but little financial gain. He has grappled with theater owners over shortening the “window” in which DVDs are released after a movie debuts, which, in Alice’s case, involved defusing a threatened boycott of the film by U.K. exhibitors. Meanwhile, at a time when the downturn has rattled Disney’s theme-park business, a recent Bloomberg story described him as being on a “spending spree” for everything from new Disney cruise ships to the $4 billion he ponied up for Marvel Entertainment.

The big picture on Iger is that he has a clear and increasingly restless view on how to keep Disney relevant in a world of fragmented media and disruptive technology—some of which comes straight from his friend Jobs. In the case of ABC, getting Cablevision to pay to carry the signal lays the foundation for other cable operators like Comcast and Time Warner Cable to start paying for something that has traditionally been free—and in Disney’s case is complicated by the fact that the company already extracts healthy tolls from cable operators for other channels, particularly ESPN. But getting paid directly for ABC will help ABC’s struggling TV station business and, hopefully, help defer future rounds of layoffs at ABC News.

In person, Iger is a casual and intellectually curious man who considers himself a custodian of Walt Disney’s legacy. His emphasis has been to build Disney-branded “franchises” that cut across all of its businesses and can be replicated around the globe. To his frustration, the bulk of those have come not from Disney’s own film studio but from Pixar and the Disney Channel. (Hence Ross’ appointment.) Briefly a weatherman before he joined ABC Sports 36 years ago, Iger was named to succeed Michael Eisner atop Disney five years ago this week. His first day on the job, he told the board he wanted to buy Jobs’ Pixar. In each year since, Disney has outperformed the S&P 500 and nearly all of its peers.

At $64 billion in market cap, Disney is the biggest media construct on the planet, giving it a heft that Iger is not averse to using—even if his own family has to miss a little song and dance.

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