The past few weeks have been very active as far as alleged internal leaks go for The Walt Disney Company. I have covered that Bob Chapek reportedly put out a directive that the entertainment company return to the characters and narratives that work. That article is currently our second-most viewed story here at That Park Place… and I’m not sure all that interest is just coming from average readers. It seems to me that industry insiders may be following along as well. This makes sense as those in-the-know are aware that Disney has been failing at the box office and in streaming for the past many months — that’s something the mainstream public probably isn’t understanding just yet.
Nothing could speak louder about the current situation with Disney’s prior direction that the Star Wars Galactic Starcruiser hotel at Walt Disney World Resort. The ninety-day window for cancellation at the hotel (in which guests only lose 20% of their reservation) is here, and people appear to be cancelling their reservations in mass. It was a big bragging point for shareholders that the hotel was fully booked for a complete four months of opening… except now it isn’t. The cancellations have been so bad that Disney was forced to take down a promo video they had recorded.
The old path forward for Disney seems to be over.
Here at That Park Place, we’ve been working hard to find out more about Susan Arnold, the new Chair of the Board of Directors for The Walt Disney Company. While we knew this meant the end of Bob Iger, and we knew Bob Iger’s legacy in his later years, we weren’t sure which way Mrs. Arnold was likely to push the company. That’s where Kamran Pasha comes in over at Midnight’s Edge. Before we get into his detailed understanding of what is going on with the Board, let’s first take a look at why Robert Iger leaving is such a major shift, even if we knew it was coming.
Bob Iger was one of the greatest CEOs of all time. He managed to acquire Marvel, which rocketed Disney into the stratospheres of entertainment companies. You have to remember that prior to Marvel (and Pixar), Disney was doing well, but it wasn’t one of the biggest companies on the planet. Iger changed that. He also brought in Star Wars, which seemed, up until 2017, to be the biggest get — and at a bargain — since they had acquired Marvel. From those standpoints, Iger was fantastic. The stock price for Disney also skyrocketed under his lead. But Bob Iger was not only the CEO of The Walt Disney Company… he was also at the head of the Board of Directors. This meant that Iger had more power than his successor could even dream of controlling. Thus, when Disney became the behemoth of the 2010’s, Iger began to toy with political aspirations; he pondered running for president of the United States, he pushed for being the ambassador to China. And during that later phase of his tenure, Iger went largely unchecked because he controlled both sides of the company: the executive side and the investment side. This allowed Iger to throw some caution to the wind. He gave Kathleen Kennedy and Lucasfilm far too much partisan power over Star Wars narratives. He took a huge risk in building Shanghai Disney, opening the company up to significant communist influence and manipulation. Iger let some of his studio heads push personal projects and social agendas over making money and pleasing fans. Ultimately, Iger leaves the company with a mixed legacy: a glorious start, with a messy finish.
But who is Susan Arnold, the new chairperson? Kamran Pasha helps us fill in the gaps. Mrs. Arnold was essentially put into the Disney board by the Carlyle Group, a massive private equity that represents the wealth of many of the world’s most powerful players. Here’s the Carlyle profile on Mrs. Arnold:
Susan E. Arnold is an Operating Executive focused on the global consumer and retail sectors. She is based in New York.
Previously, Ms. Arnold was an executive with Procter & Gamble for more than 29 years. Prior to retiring in 2009 as President of Procter & Gamble’s Global Business Units, she held various positions within the firm, including Vice Chair of Global Beauty and Health. Ms. Arnold currently serves on the Board of Directors of Disney, as well as the Carlyle portfolio company, The Nature’s Bounty Co.
Ms. Arnold earned her bachelor’s degree from University of Pennsylvania and her MBA from University of Pittsburgh.
What is so important about this is that Mrs. Arnold isn’t a Disney insider. She’s not from within the company. She’s an outsider who was put in charge of the investment-side of the company by corporate and investor interests. This isn’t someone who is likely interested in narratives or agendas; this is someone who was put in her position to make sure that Disney makes investors money. Given her résumé, she’s profoundly capable of doing so. However, she’s not only supremely capable, she’s also nearly invincible given her social category. You see, Susan Arnold is a lesbian. And that means when it comes time to shut down the social aspirations of people like Kathleen Kennedy, who may be more interested in societal change than investor returns, Susan Arnold is the person the board believes can do just that.
There’s far more information provided by Kamran Pasha and Andre, and I recommend watching the entire video, even if there are parts that are a bit hyperbolic:
This also helps explain why we’re starting to see changes that would seem unbelievable in the past. Remember when I reported that Kathleen Kennedy essentially has no movie control over Star Wars anymore after Patty Jenkins abandoned the project (sources tell me it was Jenkins that grew frustrated with Kennedy, not the other way around)? Remember when I said that Dave Filoni and Jon Favreau were being given the keys to the kingdom for a Star Wars Cinematic Universe? Well, I drew some flak for that one because people really couldn’t believe that a newly rehired Kathleen Kennedy could be cut out of that loop. Perhaps they had forgotten that she was already removed from The Mandalorian as having any creative impact.
Take, for example, Yellow Flash 2… a YouTuber that I recommend you watch if you want inside scoops on a regular basis. He’s excellent, but for the first time ever, he and I disagreed about Kennedy. It was brought to my attention that he had criticized one of my statements about Kathleen Kennedy, and I found that perfectly understandable. However, a sea change is occurring at Disney, and the dots are connected once you realize who Susan Arnold is. More importantly, you have to understand why she would be the one that investors want in charge. Kathleen Kennedy was able to do what she wanted, for the most part, because Iger was in charge of both sides of the company. Iger had political ambitions that aligned with the Kennedy narratives. It was in his interest that she pursue societal and cultural change through Star Wars. That game is up, however, as Disney+ subscriptions have stalled and the stock is down about 20% on the year. Numbers people are in charge now, for better or worse, and they are in their positions to create return on investment. Kennedy may be too much of a liability to remove from her position, but now that she’s locked in place (and can’t publicly complain easily), she can be locked out of certain roles that she might not maximize for profitability.
All of this does not mean that Chapek and Arnold are likely to bring utter joy to Disney fans. Yes, they likely will restore narratives to that which works for increased Disney+ subscriptions and box office results. That’s fantastic for fans because they’ll be getting what they want. But they’re also likely to raise prices for streaming, raise prices for parks and cruises, and cut CAPEX everywhere possible. Disney is shifting into a new era; they’ll give you what you want, at a cost. The Iger era of creative super-control is ending, and that’s probably why he left his farewell message the way he did… because two different ideologies have been battling, and his is on the way out:
As my time at The Walt Disney Company comes to a close, I write to thank all of you for what has been a thrilling and immensely gratifying 47½ years. I would love to be able to do this in person, but the global pandemic has deprived me of that opportunity, so please forgive the less than personal nature of this farewell.
It is impossible for me to fully express my feelings, but I would like to leave you with a few thoughts, some memories, and above all else, my deepest gratitude.
My ABC/Disney journey began when I was 23 and ends as I approach my 71st birthday. It has been unpredictable, exhilarating, wildly fulfilling, and certainly a lot of fun. To say I have tremendous respect and affection for the thousands of people I have worked with over the years would be a gross understatement.
I have enormous pride in what we have accomplished and transforming Disney into one of the world’s most admired companies is at the top of my list. We did this by producing the finest in content and experiences, embracing cutting-edge technologies, and expanding our presence around the world, and nothing has been more important to me than imparting and applying the highest standards of quality and integrity when it comes to our people and everything we create.
We’ve also endeavored to tell stories that reflect the rich diversity of our world, nurturing a multitude of perspectives, both in front of and behind the camera, and I am certain our continued work in this area will remain a top priority.
Given the abundance of consequential change in our world today, and the timeless desire for human connection, I am confident the need for great storytelling will endure for generations to come, enhanced by new technologies that will bring these tales to life and deliver them to people around the globe in even more extraordinary ways. As the world continues to evolve and transform, we will always gravitate to stories that bind us together – tales of adventure, love, friendship, and heroism, tales that enable us to escape, that comfort and inspire us, that give us hope and reason to be optimistic, tales that inform us… and, of course, touch our hearts. I can’t think of a more exciting time to be in our business.
I have a long list of favorite moments… too many to mention, but suffice it to say I loved coming to work every single day, and as I look back on my entire experience, it truly has been the “Ride of a Lifetime.”
I wish all of you the best of luck, and in particular, I wish my successor, Bob Chapek, lots of luck, too, as he steers this great company into its next century. Only seven of us have had the honor of being the CEO of The Walt Disney Company, a distinction I was always proud to have, and a responsibility I was honored to accept and fulfill. I know Bob shares those same feelings with me.
My one lasting appeal to everyone is to make sure you always keep the creative fires burning. Nothing has or will serve us better than the exceptional creativity that comes from talented cast members and everyone involved in the creative process. I will forever have a deep and very personal appreciation and respect for all of them.
Most important, never lose sight of what makes The Walt Disney Company such an incredibly special place… our unique culture marked by a shared sense of belonging, joy, camaraderie, and the pride that comes with doing what we do, and that is bringing people from different generations, ethnicities, and backgrounds together with our exceptional storytelling.
I also want to thank my four children, Katie, Amanda, Max, and Will, who have grown up with our company and never took for granted that “Dad” had one of the coolest jobs in the world. Their love has always fueled me. And, of course, I want to thank my wife, Willow, my single most trusted advisor, and my partner in all aspects of my life. The joys of running The Walt Disney Company were more than amplified by the joy we share together.
As I sail off into the sunset, I will remember these poignant words: “The past is a lantern on the stern of a boat, shedding light on the waters we have all sailed together.” I thank you all and wish you smooth waters ahead!
Bob
So here we go to a new Disney and a new way forward. There will be positives and negatives. And for a plethora of reasons, there will be less Star Wars Galactic Starcruisers, more Luke Skywalker.
Let us know in the comments below what you think about all of this and the future direction of The Walt Disney Company. And as always, keep checking out That Park Place (as well as Midnight’s Edge and YellowFlash2) for all the latest on Disney, Star Wars, and everything behind the scenes!
