Michael Eisner, who ran Walt Disney Co. for 21 years, said his successor, Robert Iger, should continue as chief executive officer beyond his recently extended term.
“If I had my choice I would have him stay even longer, God knows, maybe he will,” Eisner said in an interview yesterday with Bloomberg Television at the Allen & Co. conference in Sun Valley, Idaho. “The longer he stays, the better it is for the shareholders.”
Eisner minimized the financial fallout from “The Lone Ranger,” a summer box-office failure for Disney. The company also produced 2013’s top picture, “Iron Man 3,” which has sold $1.2 billion in tickets worldwide, according to industry researcher Box Office Mojo. Both men are attending the annual gathering of entertainment, technology and finance executives.
“The great thing about Disney (DIS:US) is this is such a big company, as opposed to what it was when I went to it, that a stumble like ‘Lone Ranger’ is going to have no effect,” Eisner said. “Their parks are strong, they have all those Marvel and Pixar, Star Wars movies coming out.”
Iger, 62, has been CEO of the world’s largest entertainment company since succeeding (DIS:US) Eisner in 2005. Burbank, California-based Disney said on July 1 it extended his term another 15 months to June of 2016, citing the 193 percent total return to shareholders during his tenure. Iger is also chairman.
Disney last week released “The Lone Ranger,” a $225 million movie featuring Johnny Depp that fell flat with movie fans. Barton Crockett, an analyst at Lazard Capital Markets, estimates the company may have to write off as much as $190 million on the picture.
Iger, in an interview at the conference, said the board felt extending his contract was a good idea. He also pointed to the company’s 2013 box-office successes, including the Pixar feature “Monster’s University,” with $406 million in worldwide ticket sales, and “Iron Man 3.” He declined to respond to a question about a writeoff of “The Lone Ranger.”
“We had two successful movies, and one not so successful,” Iger said. Last year Disney bought “Star Wars” maker Lucasfilm Ltd. for $4.05 billion, and Iger led the 2006 acquisition of Pixar Animation.
Eisner, 71, left the company after a high-profile fight with board members including Roy Disney, nephew of the company’s founder. He runs Los Angeles-based Tornante Co., which has been investing in new media ventures such as Vuguru LLC, an independent studio that develops scripted programs for online and international platforms.
The longtime media executive said Hollywood’s focus on big-budget action movies with the potential to become multi-film series is fraught with risk.
“People, not at Disney, but all over the industry think, ‘Oh you just take a brand and you put a lot of money behind it and you get billions of dollars of assets, and even actors that seem that they can’t lose, lose’” he said.
The best approach is to start with smaller movies and new ideas, Eisner said.
“I think the failure of not only the ‘Lone Ranger,’ but there are a lot of them, that’s just one, is reawakening the industry on what you have to do in the movies.”
Disney closed little changed at $64.91 yesterday in New York. The stock has gained 30 percent this year, compared with 16 percent for the Standard & Poor’s 500 Index.
To contact the reporters on this story: Christopher Palmeri in Los Angeles at email@example.com; Jonathan Erlichman in New York at firstname.lastname@example.org
To contact the editor responsible for this story: Anthony Palazzo at email@example.com