It may be time to sell that Disney stock. The days that Mickey and company were an unrivalled entertainment powerhouse may be numbered and the biggest reason for their possible downfall isn’t a virus shutting down the entire globe or worldwide political upheaval. No, Mickey’s greatest enemy right now is the guy sitting in the CEO’s chair.
Now that may sound like a lot of doom and gloom talk considering that 2021 has been Disney’s year. Despite the COVID-19 pandemic still casting a dark shadow over the entire planet, things are going Mickey’s way (well, more than others anyway).
Black Widow, Shang-Chi and the Legend of the Ten Rings , Eternals and Jungle Cruise are currently among North America’s ten highest grossing movies of the year. Don’t forget Disney also hit a late summer home run with Ryan Reynolds Free Guy. People are flocking back to Disney’s amusement parks and the House of the Mouse recently hit it out of the park with DisneyPlus day, capturing tonnes of social media buzz and generating plenty of fan excitement. But Bib Chapek, current Disney CEO, may turn out to the dark lining in an otherwise bright cloud for Disney.
Before we begin piling on Chapek (who was anointed king of the Magic Kingdom in February of 2020), let’s make some important acknowledgements first. Disney is a worldwide entertainment conglomerate that employs enough people to populate a city, operates in every corner of the globe and is a household name across the entire planet.
In his memoir Ride of a Lifetime, former Disney CEO Bob Iger (who deserves a spot of the Mount Rushmore of CEOs for turning Disney around and as much as he did as fast as he did) spared no opportunity to laud Chapek, describing a bond the two formed during high pressure business situations
While his appointment raised more than a few eyebrows in both the entertainment and business worlds, Chapek is by all reports a nice guy who excelled at his previous jobs and his resume was impressive enough to earn the job. And no matter how successful he is, he will always be a victim of Iger’s success and ascended the throne just as the world was plunged into the COVID-19 pandemic (which affected every facet of Disney’s sprawling corporate empire). In short, Chapek has been plagued by historical events beyond his control so it would only be fair to cut him a little more slack than normal . . .
But having said all that, Chapek seems to suffer from the same deliberate disease that many CEOs do; a disease that people are growing increasingly intolerant of post COVID-19. One that could easily threaten to bring down the House that Mickey built if Disney doesn’t course correct. And fast.
Like many other CEO’s and captains of big business, Chapek has little to no regard for his company’s talent. And not only does he consider the interests and well being of labour irrelevant, but completely beneath him.
The first sign that Chapek has little more than a thinly veiled contempt for the people who work for him was Scarlet Johanssen’s lawsuit over Black Widow. You probably know the tale backwards and forwards by now, but the gist of Johansen’s suit was that Disney refused to renegotiate her deal after deciding to put Back Widow on DisneyPlus the same day it was released to theatres (despite numerous promises Black Widow would get a traditional worldwide theatrical release that would ensure Johanssen generous box bonuses as both star and producer). While many think it was Disney’s decision to make Widow available on DisneyPlus (for an extra charge) that triggered Johanssen’s legal action, it was actually Disney’s refusal to renegotiate her compensation package that nearly landed them in court.
No matter what you think of Johanssen’s decision to sue, Disney’s initial response painting her as selfish, entitled and oblivious to the plight of normal people during the pandemic was jaw dropping. And Disney’s decision not to revisit the deal was made even more difficult to defend when it was revealed that it approached Dwayne Johnson to renegotiate his bonus package for Jungle Cruise (which was also made available on DisneyPlus the same day it was released in theatres). It turns out that while Chapek and Disney were ignoring Johanssen-a founding member of the MCU-they were knocking on Johnson’s door with a blank cheque.
In the end, Disney backed a Brinks truck up to Johanssen’s door before the case could go to court. For her part, Johanssen says she’s looking forward to future projects with Disney, particularly Tower of Terror. But what should have ben a teachable moment was ignored completely by Disney’s new CEO.
Just days before the release of the blockbuster Shang-Chi, star Simu Liu was more than a little miffed when Chapek referred to the movie as an “experiment.” Disney then had to release a statement addressing the brief media brouhaha that followed as a result. Seems pretty small, right? Except it was just another in a string of unforced errors Disney has made under Chapek when dealing with marquee talent. And every moment it has to spend putting out media fires is a moment they aren’t making block busting movies, award winning TV shows or adding million dollar attractions to it’s theme parks.
And speaking of theme parks . . .
Before Chapek climbed to the top of Disney’s corporate ladder, he was in charge of it’s parks and attractions. He made them more profitable than they’d ever been. This success was what made him Bob Iger’s successor.
But the day Chapek was announced as Disney’s new emperor, fans of the parks offered sombre warnings. Chapek may have made the theme parks fatter on Disney’s annual profit and loss sheets, but he did so by nickel and diming just about every part of their operation, investing as little as possible in labour (how poorly Disney paid and treated it’s park staff was arguably the only blemish during Iger’s tenure; and that had Chapek’s fingerprints all over it) and dramatically hiking prices. A week at Disney is now virtually beyond the means of many North American families.
(Disney recently came under fire for stating it wasn’t going to decorate its restaurant and hotels for Christmas as a cost cutting measure. Many in the Twitterverse dubbed the Disney CEO Bob “Cheapek” as a result.)
Which brings us to another concerning development. On of the more genius moves Iger made when it came to Disney’s creative side was removing as many of the administrative hurdles as possible (he got rid of Ike Pearlmutter because he was becoming the bane of super producer Kevin Feige’s existence). Iger recognized that all of Disney’s success sprang from the creative juices of its people. Captain America, Buzz Lightyear, Elsa and Darth Vader didn’t just star in billion dollar movie franchises; they also sold billions of dollars in toys and merchandise, they moved comic books and became massive new attractions that sold tickets to Disneys theme parks. Iger gave his creative geniuses as much free reign as he could and Disney flourished as a result.
But Chapek seems to be undoing all of that. He is ruffling more than a few feathers by re-inserting a corporate layer over the creative minds. And in in many cases, he’s forcing his imagineers to answer to people who are completely clueless about their new businesses. He’s put people who previously oversaw merchandise sales in charge of movie and television production, a move that has catastrophe written all over it. Whether it was his poor handling of Johanssen’s lawsuit to this new corporate barrier he’s lording over his story smiths, Chapek is proving that while he may be really good at squeezing pennies out of a spreadsheet, he fails to understand that creative talent is the reason for Disney’s success and he has little to no interest in dealing fairly with people on talent on both sides of the camera or the workers who keep the theme parks running.
This is already having a significant ripple effect. Kevin Feige, arguably the most important person on Disney’s payroll right now, was livid over how Chapek handled Johanssen’s lawsuit. The Russo brothers-the movie making pair behind the most successful and profitable movies in Disney’s extensive catalogue-have delayed a much hyped return as a result of the Black Widow debacle. Many artists at Pixar were upset at his decision to put Soul and Lucca on DisneyPlus for free while charging premium fees for other titles. Many former Disney employees have gone so far as to begin a petition to have Chapek removed as CEO.
So what happens if after a few sabre clashes, Kevin Feige decides to walk away? The MCU may stagger on for a few steps without it’s architect, but it will ultimately collapse without him. What if John Favreau or Dave Filoni-who have been crucial to reinventing and re-establishing Star Wars’ as an entertainment juggernaut after the turbulent sequel trilogy-also walk?
Under Chapek, Disney has lost credibility with top talent when it comes to negotiating big deals. Who will have any faith that Disney won’t arbitrarily change the terms of a deal it signs like it did with Johanssen? Who still believes Disney has any good faith when it comes to negotiating deals at all? What if other major talent follow the Russo Brothers lead and start passing on Disney projects as a result of it’s refusal to treat talent with the respect it deserves?
Big names have more options today than they’ve had in years. Rian Johnson recently cashed in on the success of 2019’s Knives Out by selling the sequel rights to Netflix for a nine figure cheque. Despite criticizing it for years, Steven Spielberg has now embracing streaming. Zack Snyder looks like he’s skipping out on the studio system for now, taking his projects (and his passionate fanbase) to Netlfix. When Christopher Nolan jumped the Warner ship last year, a lot of people wondered if he may sign with a Netflix or Amazon before he partnered up with Universal (who will almost definitely use their new friendship to benefit it’s struggling Peacock streaming service).
Streaming has opened a lucrative new avenue for established Hollywood talent and has opened the door for a new profit source. That’s why Amazon paid the Gross Domestic Product of a small country for MGM (most notably, the rights to James Bond and 007’s extensive film catalogue). While big names may have tolerated unhappy corporate relationships in the past because they had few options outside of them, they would be welcomed with open arms and bags of cash by the competition. The point is big names like Feige and Filoni and others have plenty of other suitors if they quit Disney. Or are driven out.
Look at it another way; while IATSE-the union that represents the tens of thousands of craftspeople, designers, technicians and labourers who are truly responsible for making movies happen-recently averted a nation wide strike, the new deal is only three years long and left a lot of its membership unhappy. If Hollywood finds itself back on the brink of another strike in three years, Disney will be looked to as a leader in negotiation by virtue of it’s size alone. How will Chapek-who has demonstrated little to no respect for talent and workers alike-handle that burden? How will he handle a looming writer’s and director’s strike in 2023? His history shouldn’t inspire confidence.
How will Chapek deal with an increasingly hostile China? Will he stick to some guns or fold entirely?
Chapek has been riding the coat tails of Iger’s success so far. Disney’s latest string of blockbuster hits were all green lit under Iger, who also launched DisneyPlus (which kept Disney afloat during the lean days and months of the Pandemic). But the employee unrest coupled with the dramatic slowdown of DisneyPlus subscribers and a drop in Disney stock? That’s all on Chapek. There were even rumours that he was going to skip the recent D23 weekend -Disney’s biggest promotional event of the year-because he was afraid of being booed off stage. And he hasn’t even had the job two whole years yet.
Need another sign of how bad the situation over at Disney HQ has actually gotten? Remember when Bob Iger showered relentless praise on his replacement? There are scattered reports that the relationship between the two has grown frosty. That should be the ultimate red flag and it’s waving like it’s stuck in a hurricane. Now the question is how long it will take the powers that be at Disney to notice.
Image via www.BlogMickey.com
