Last Sunday night (20), the board of directors of the Walt Disney Company shocked the world by announcing the resignation of the company’s CEO, Bob Chapek, and his replacement by his long-time predecessor at the company, Robert Iger. So unexpected was the move that the Wall Street Journal reported that “Disney officials said they were baffled by the email sent by Iger on Sunday and immediately began to speculate whether the message was real or whether it came from an email account. email hacked”.
The same board of directors had voted to renew Chapek’s contract as CEO until 2024 last June! Susan Arnold, chairman of the board, said at the time:
“Disney has suffered through the pandemic, but with Bob at the helm, our business – from theme parks to streaming services – has not only weathered the storm, but has emerged in a position of strength. […]🇧🇷 Bob is the right leader at the right time for The Walt Disney Company, and the board has complete confidence in him and his leadership team.”
It turns out that it is possible to go from being the “right leader at the right time” to being the wrong leader at the wrong time in just five months.
What made the Disney board suddenly lose confidence in Chapek? In a first analysis, it would be a decision driven mainly by the drop in the company’s profit margins. In the print edition of the Journal, the report on the change at Disney included an eye-popping piece of information: “Since Disney+ launched three years ago, the service has lost more than $8 billion as it expands. quickly. In the quarter ended October 1, Disney+ added 12.1 million new users, bringing its global total to 164.2 million subscribers.” In the online version, the information: “In the most recent quarter, however,
[o serviço] had a loss of US$ 1.47 billion, more than double the amount recorded in the previous year”.
The Disney+ subscription fee (at least in the United States) is $7.99 a month, or $79.99 a year (assuming the early-payment discount), but next month, the service will pass. having ads. For those who want the premium, ad-free version, the cost will be $10.99 per month or $109.99 per year. That’s about $1.3 billion in subscription revenue per month, which is on the verge of rising to about $1.8 billion per month… and yet Disney+ has accumulated a loss of nearly $1.500. billion in three months? The impression is that the company has been filming the scenes of the series of the Star Wars franchise in space.
It’s easy to understand why companies believed that streaming would be a much more stable and profitable way to deliver entertainment to audiences. When Disney produces a movie, the company only takes your money if you get off the couch to go to the cinema, at least when the release is only available in that medium. If Disney releases it directly to television, that revenue will depend on how much advertisers are willing to pay to place their ad on that movie. But with a subscription service, Disney takes your money year-round if you subscribe, no matter how much or how little you use the streaming service.
So it wasn’t just these issues that may have spurred the Disney board to replace Chapek… but the perception that Chapek wasn’t fully committed to a progressive political agenda probably earned him enemies within the company and may have made many people not are inclined to defend him.
In March, as the Florida Legislature debated the Parents’ Rights in Education bill—the legislation that Democrats insist on calling “Don’t Say Gay”—Iger, then the former CEO of Disney, loudly opposed the matter. , and the perception was that Chapek did not want the company to get involved in this dispute. As the Hollywood Reporter reported at the time:
“Chapek is focused on making his mark on the company’s culture and is clearly less willing to get into political discussions than Iger. For example, a source well-informed on the matter said Chapek had refused to press on voting rights issues.
Chapek is discreet about his political views, but he is believed to be much more conservative than Iger, who was a member of the Democratic Party before becoming independent in 2016. considers irrelevant to the company and its business’, informed the source”.
It didn’t take long for gay and lesbian Disney employees to complain that the company’s management was sidelining them by not trying to use their influence to overturn the bill. Chapek was slow to come out against the proposal, and the results did not go well for him, as Phil Klein of the National Review reported at the time:
“For those who haven’t been following along, Disney CEO Bob Chapek came out publicly by calling [o governador da Flórida, Ron]
DeSantis to challenge the Parents’ Rights in Education bill, which has been dishonestly labeled by Democrats and the press who agree with them as the ‘Don’t Say Gay’ bill. Some have suggested that this pressure has put DeSantis in a bind, given that Disney is one of the state’s most powerful corporations and major employers. But the governor not only sent Disney on a walk, but also publicly expressed himself about it. […]🇧🇷 In addition to releasing a statement, a video leaked to Fox News showed DeSantis criticizing Disney and ‘woken corporations’. DeSantis then released a campaign ad that highlighted this video, including the segment where he – rightly – criticizes Disney’s business in China.
Chapek failed to calm much of Disney’s staff and made his company an even bigger target of criticism from Republicans. (The rift led Newsweek to portray Disney, with its $203 billion in assets, as a cornered underdog about to be crushed by the big bad GOP.)
In late October, Chapek appeared on a Wall Street Journal podcast and was asked directly if the company wasn’t becoming “overly woke.” Chapek’s response was a masterpiece of avoiding any direct political statements:
“The world is a rich and diverse place and we want our content to reflect that. We are very blessed to have the best content creators and they have the same vision. But I believe this is good from a commercial point of view as well, because you end up attracting the widest possible audience. We are certainly living in a world where everything seems to be polarized, but we want Disney to champion people together, and I believe we do that through diverse stories and characters.”
For his part, Iger briefly served on a business advisory panel for the Trump administration, but left when the then president withdrew the United States from the Paris climate accords. He has also repeatedly clashed with the former president and exerted a lot of pressure on immigration, gun control and other issues.
Earlier this month, CNBC reported that Chapek was keeping in touch with Republicans in the House of Representatives to try to patch things up:
“Disney CEO Bob Chapek has been in talks by phone with House Republican leaders, including Minority Leader Steve Scalise (Republican of Louisiana), according to sources heard by the report. Scalise is a candidate to become House Majority Leader if the Republicans take control of the house, which would make him No. 2 in the majority party.”
Chapek seemed intent on depoliticizing Disney, or at least preventing the company from fully embracing any political controversies that arose. Conservatives love the slogan “Sealing, not profiting”. But Chapek wanted Disney to be less woke, and his efforts have not improved the company’s bottom line.
Disney’s board of directors is aware of Iger’s increasingly overt political views and concluded that they would do less harm than continuing Chapek’s less controversial approach. So, once again, it may have been a case of “rewarding” who was most woke. The board may have felt that Iger was more likely to please progressive Disney employees and mitigate a potential problem that Chapek’s more neutral approach would exacerbate.
*Jim Geraghty is a senior political correspondent for National Review.
© 2022 National Review. Published with permission. Original in English🇧🇷
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