March 4, 2004

HITLER TO SHARE POWER WITH HIMMLER

Berlin, Germany – Today, after months of threats from America to enter the war, Fuhrer Adolph Hitler’s cabinet announced that Hitler would be sharing power. The hope is that America will back off in light of this rebuke to Hitler’s aggressive ways.

Of course, this is a ridiculous analogy. But probably not to Roy Disney and Stanley Gold. And this observer of the situation has to say, for the first time, that Michael Eisner is so much his own worst enemy that he might actually lose this fight and be out of Disney by this time next year.

Splitting the CEO/Chairman gig this late in the game, in the face of most of the rebel forces saying that it is not enough to convince them, is a slow-pitched softball in a major league game. But when the guy slated to share the power is our tainted hero’s sidekick is a slap in the face to everyone who is honestly concerned about the future of this company (a group in which I do not include Roy Disney or Stanley Gold, after they made clear that the performance of the company is not as important as their revenge against Eisner).

The “symbolic move” Mike & The Mikeskateers just made will make things worse, not better. It can be seen as better by a grand total of no one. That said, Eisner has some time to make his move. And there is only one move that will make things better… he needs to bring in a major player in some area of his company – and make no mistake, it is still his company – and let that acknowledged genius completely loose.

The only problem with this idea is that there aren’t many certified geniuses floating around out there. Unless Disney finds a savant who can make things happen in six months or less (yeah, right) they need to find a play that creates the image of inevitable forward movement. Of course, the good thing is that the person/company does not have to deliver, since as we all know, there are no guarantees in the film/TV business. But offering something up that feels like “real change” is absolutely critical.

The masterstroke would be a buyout of DreamWorks and a return of Jeffrey Katzenberg to the leadership of the animation division. That won’t happen, but that would be a masterstroke. Here are some ideas that might be a bit ore realistic…

Diller – Bringing in Barry Diller as a partner to lead all television operations would be a huge coup, as Diller has not really worked for anyone in a long, long time. He was hated by many at Universal, so it is not a 100% win. But he knows how to build empires and, given the stability of a company like Disney to build on – unlike the ever-wavering ownership at Universal – he could turn ESPN, the other cable nets and ABC into a company that would soon be looking to buy Comcast instead of the other way around.

Pixar – Make a modest and press-leaked play to reopen negotiations with Pixar. Explain the concept of the deal in the press. Give another 40% of the way between Disney’s offer and Pixar’s demand and sell the obvious value of that synergy. Eliminate the personal. Make the dollars and sense clear away from the cloud of the recent negotiations. Let the media make the case. Take the power away from the “Michael can’t be bargained with” argument. And if worst comes to worst, the deal gets done and Disney eats a couple hundred million dollars for a deal that public perception wants to see done.

ABC – If you don’t give the reins to Diller, invest Susan Lyne with the money and the power to break new ground in the industry. Offer opportunities to high-profile talent to do dream projects for the network at a price. Recreate the Movie of the Week. Take the Monk franchise and recreate the old “Mystery Movie” wheel. Something! Fight to get Bruckheimer back in house. Do some Fox-style or MTV-style programming. Do some live TV. Decide on a face for the network… not just a series of shows… and sell it, sell it, sell it. ABC hasn’t really had that franchise feel since the days of Full House Family Fridays. And stop canceling shows like Karen Sisco as though you had something better to put on in its place.

Mike DeLuca – He’s available and trying to figure out what’s next. Miramax may or may not exist after the next couple of years. Take the Touchstone label and give DeLuca $400 million to build something. Let him know that he will be gone the first time he gets caught doing anything untoward. And let him loose. Most people feel he got a little lost at the end of his run at New Line and DreamWorks has never let him really do his job. DeLuca knows what he is doing and he has gone through the hard times. Disney can have it’s own Miramax/New Line, albeit probably without the Oscars, and a few hits a year make it solvent… and a few more than a few make it a cash cow.

Joe Roth & Revolution – When does the contract between Revolution and Sony end? 2005? Revolution is ripe for poaching. The scorecard for the company has not been overwhelmingly positive. But they produce a lot of stand up doubles. Getting Roth, now in a very different position than he was when working for Eisner, to come back to the fold would turn Disney into a two-producer shop and fill much of the live-action pipeline, leaving Nina Jacobson to fill the holes in the annual slotting with great precision.

Montecito – Tom Pollock and Ivan Reitman’s company is going to need a new home when DreamWorks fades into Amblin. Their product tends to be anti-Disney by definition… all the more reason to try to do a deal.

MGM – The biggest “family” library in the world is in play. Buy it. No company is better positioned to take full advantage of the MGM library than Disney. Build a new cable network with it that can expand the Disney brand beyond the pure “family” market. Imagine Bravo without the homosexuals mixed with TCM. Lots of Disney cable programming can skew older, but doesn’t have a platform. And if they could bring in Chris McGurk, who has friends and enemies, but who is a respected fiscal manager and a brilliant tap dancer, that would also be a win for Wall Street.

I’m sure I’m missing someone or some company. Please feel free to send in ideas that I have missed. But the point is that Eisner has no time left to be an isolationist. It just isn’t going to play. The company can add an additional 5% in growth this year and it won’t be enough.

“Splitting power” with George Mitchell is the first really stupid move that Eisner has made in this battle. Now it’s tie to get busy or to start packing.

READER OF THE DAY: T.B. BOY writes: “Already in Japan, they have movie carrying device, just like the Ipod. Nifty looking little things, that are still just the size of an Ipod, turned horizontally. They cost more or just a little more than the regular ipod, but they do exist. RCA even wants to sell one in this country, later this year.

This is all fine and good, but I am sick of having to take everything with me. Why do I need to carry all my music and my movies, with me everywhere I ago? What kind of grandiose jackass would it make me if I put all of my cds on 3 ipods, and all my movies on a RCA like movie device? The world changing into a place where we have the ability to carry it, ALL, with us. Absolutely befuddles me, and makes me wonder what the definition of home becomes if you can bring great chunks of your home around with you.

There has to be a breaking point and I eagerly await the point where the technology exist, but it will used in its place. Not as a means of carrying my pop culture world, around in my pants. I love it all, but it has its place, at HOME!

Have a nice day, and enjoy your Ipod until the battery dies on you. At least now they replace it, for a price.”

And CHICAGO JOE sent this: “I guess I'm too old to understand why someone needs to steal movies when DVD's are, really, such a good value right now. The opening week price at Best Buy for most hot movies is less than $18 in Chicago. Who wants some crappy copy off the web when you can have a pristine studio pressing so cheaply?

I suppose it has a lot to do with the thrill of the hunt. The logic that every pirated download equals a lost sale has never held water for me.

One good idea has come to pass. I brought a copy of School of Rock last night ($15.99, thanks) and it came with some pretty decent looking temp tattoos and guitar picks (you know, for kids). I've been thinking that tossing in just this kind of cheap swag would be a great way to add (perceived) value to DVD's. What other kinds of cool stuff would be good? Fun to think about.

Sure, it's a small thing but it's a good and thoughtful thing. It's been clear for some time that the music industry's approach of all stick and no carrot is a huge mistake. Once again the DVD folks have shown the way, let's encourage them to keep it up.”

E ME: How would you keep from being voted off the island?