Disney EchoEar Grand Mouseter
Joined: Aug. 2001
||Posted: Nov. 22, 2003 4:27 am/pm
Well, I'll place my bets and stick to my guns that the Disney company is not being placed for sale or any of its major divisions to be split off. If there's any division that ought to be sold that is truly dragging the company down it's the ABC broadcast network, unless Disney can hire some best and brightest human to come aboard over there to program it to reach hit status. But from where I sit (all strictly speculation, guessing and armchair quarterbacking) my guess is that Disney Feature Animation is going through internal reorganization, downsizing and repurposing. And those of us in the corporate world who've been through this at the workplace know just how painful that can be.
In the Jim Hill article Jim interviews a "Wall Street analyst" who gives Jim an opinion as to what is going on. Well, it could mean what Jim quoted the analyst as saying. I happen to watch CNBC on cable frequently, the stock market channel, and one thing I've long ago learned there is that there is a "Wall Street analyst" to support every opinion under the sun. For every analyst that Jim Hill can find to support a theory or storyline, there is very likely another one with an entirely different take on the matter. And nobody, not even Wall Street or Disney media pundits, knows for sure except those internally at Disney in high up management.
With that said: I think the economy since the recession began in 2000 has taken a long time to rebound, but it finally is. Predictions over the past several months for a rebound in "the next one or two quarters" have just taken a very long time to materialize because it couldn't be predicted that 9/11 or global tourism decrease or two wars on terrorism would happen, or that corporate scandals would cause companies to undergo such scrutiny and internal change. Under such circumstances it's hard for a company to adjust to a newer lower cash flow, to predict future cash flow, or make capital plans or expansion plans when uncertainty persists. Quite a few fiscal quarters ago Disney corporate took a hard look at what its various divisions and sub-divisions do and how much all that costs vs. profits realized. They likely looked at their markets. They definitely took into account harsh criticism of CEO Michael Eisner about a year to a year and a half ago, calling for Eisner's head on a proverbial platter because the share price of Disney stock was plummeting vs. what Eisner's compensation package was and the perceived schlock product and services Disney was putting on the marketplace, at that time. Stinging from "Treasure Planet" doing so badly at the box office a year ago and the intense criticism, I think Michael Eisner finally woke up one day and decided to prevent his head from being placed on the platter. So, in short, Michael Eisner is finally working for a living. If you look at a Disney stock chart, and the quarterly results posted on November 20, the company seems to be turning around and doing better.
However, decisions made at corporate many months ago are still on the implementation road. That may include Disney Feature Animation in Florida being closed after all. The facility served its purpose with "Mulan", animated shorts and some other feature movies. But with Pixar doing Disney movies better than Disney does them, Dreamworks "Shrek" and Fox's "Ice Age" providing serious challenges in the marketplace and to Disney's former supremacy in feature animation, and Viacom's Nickelodeon and Time-Warner's Cartoon Network capable of home video, movie theatre and cable TV cartoon product that successfully challenges Disney...with shareholders likely still not thoroughly happy with Disney, and Disney fans obviously abandoning the company in favor of other fare... I think Disney sees the tough luck handwriting on the wall, realizes it can no longer rest on it's brand name as a slam dunk in customer loyalty, and is consolodating, downsizing, reorganizing and repurposing itself for a new era for itself in the marketplace.
Disney will continue to make family oriented animated product. But it may no longer need for as many studios of itself worldwide to turn out the same amount or quality of product. With techology maybe it takes fewer workers nowadays to churn it it out. Why do "lavish" when made-for-video and TV animation quality will do? "Lavish" might be turning out feature animation product, such as what we've come to know each summer or year-end, every 18 months or so in alternation with Pixar's stuff under a new Pixar contract. In a worldwide market, with Disney recent announcements and hirings and management promotions clearly lately being to increase marketshare in its global brand, TV animation quality and direct-to-video quality might be just good enough to expand into global markets. And maybe under a new contract with Pixar, Disney and Pixar might agree to space out their respective feature-length high-quality animated films away from each other. That would grant each more time to make money in the marketplace with their respective releases, get them away from each other so they don't compete with each other, and allow Disney some breathing room to do feature animation less rushed, more time and quality attention paid to it, and to market it more effectively.
Think about it. When Disney moved the premiere of "The Alamo" away from December 25, 2003 to April 9, 2004, it was because they couldn't do quality post-production work on that short of a deadline after principle photography and production ended in June 2003, it was just too soon and too rushed. Port that notion to Feature Animation and perhaps the answer may be that the pressure to put out so much animation product and be high quality, internally at Disney, as well as market forces beyond Disney's control, increased competition and the cost-savings of technology simply combined so that the "sacred cow" of Feature Animation could be seen differently. Feature Animation is very likely being preserved. But in forms and in technologies and in contractual ways so as to acknowledge Pixar's partnership and to realistically allocate resources and technology to doing a good job rather than a mediocre job.
Think back to a year ago and how amazing it was that "Treasure Planet" didn't do well at the box office, and how Michael Eisner actually spoke publically about that just days after TP had opened, thus sabotaging his own studio's product? Think back how "Tarzan" and "Lilo and Stitch" were the last huge hits Disney Feature Animation had, and how "Emperor's New Groove", "Atlantis" and "Treasure Planet" just didn't completely win over their audiences. And think how the criticism of Eisner, just that alone, may be a spark to trying to answer the critics of him and respond to making positive changes in the face of the contract with Pixar and changing domestic and world markets. In taking the pressure off Feature Animation, acknowledging Pixar, and retooling to accept new technology and reach a new global marketplace, Eisner's probably doing what he has to do, despite the howls of pain from those affected.
It's not that I'm an Eisner-hugger, nor am I condoning or applauding what he may be up to here. I do think Michael Eisner will let go of being CEO of Disney when he is very elderly and needs to retire, or so ill that he needs to step down, or when he's still CEO and dies while in office. He won't go easily and he's not a quitter. Whether that's good or bad, I don't know. But the criticism of him by his own Board of Director members and stockholders and from Wall Street, the corporate scandals and scrutiny such as with Enron and Worldcom, and how the economy has made Disney stock dip woke him up. He takes the Disney audience more seriously and less for granted nowadays. In that, he sees that Feature Animation could be better than it is, more streamlined maybe and more up to date. It has to play out. Whether Roy Disney, Roy's son and Walt's nephew, had disagreements with Eisner how the internal Feature Animation changes should be brought about or what changes should be made, etc., that is still perhaps a likely explanation of why Roy sold his stock block.
I still will keep some virtual candles lit for Disney's Florida Feature Animation studio staff. If "the powers that be" could have been less short-sighted and more careful of their stewardship, more not ever taking their audiences for granted, more "competitive" with Pixar, Dreamworks and Fox with feature length animation, I think the closing of the Florida animation department could have been avoided. But it's all out of my hands and all I can do is armchair quarterback and hope for the best for all of them. Here are my candles burning for them, ignore the cake part of it.:
What do any of you think? Post it here.