As a seasoned industry veteran with decades of experience under my belt, I must say that the succession race at Disney is as intriguing as a good Hollywood blockbuster. The stakes are high, and the drama is palpable.
The engrossing HBO series “Succession,” which felt more like a documentary, focused on the power struggle within the Roy family, a ruthless media mogul and his potential heirs vying for control of his empire. Spanning four captivating seasons, it left audiences in awe. Despite its conclusion, the entertainment industry continues to grapple with similar succession issues, some even more bizarre than fiction. The recent change at Sony’s helm from Tony Vinciquerra to Ravi Ahuja appears to have gone smoothly. However, such transitions often prove more complicated, as revealed by The Hollywood Reporter‘s editor-at-large Kim Masters and media and business writer Alex Weprin in their analysis of potential future developments.
Alex Weprin: Hi Kim, Vinciquerra’s smooth transition to Ahuja at Sony got us pondering about the industry’s not-so-great history with CEO changes. Vinciquerra mentioned that he had been preparing for his departure since he sealed his last deal and Ahuja’s promotion to COO was part of the plan. It’s interesting to compare this to the more complicated process when selecting Alex Trebek’s successor on Jeopardy!, although they eventually managed it successfully. In contrast, Disney is currently going through a very public transition process. Do you know any companies that have handled it gracefully? Perhaps Netflix could serve as an example.
Hi Alex, I’ll start by saying that Tony has been a steady hand at Sony during challenging times. From the chaos caused by Jon Peters and Peter Guber, to the passive leadership of Michael Lynton which led to the Sony hack, Tony has provided the stability needed. Unlike many other studios who have lost money due to streaming, Sony avoided this fate because they didn’t rush into it. Instead, they profited from it like an arms dealer. The next question is who will replace Tom Rothman as head of the film studio. He’s approaching 70 and his management style has been notorious. However, he should be given credit for handling a difficult situation skillfully. There have been whispers about his retirement for quite some time now, and unlike others in similar positions, he may actually want to spend more quality time with his family.
However, let’s revisit the Netflix transformation. It appears that Reed Hastings successfully navigated this change, though it’s likely that Ted Sarandos felt less than enthusiastic about sharing power with Greg Peters, the numbers expert. Sharing the crown with two heads is not typically a sustainable strategy.
Currently, Paramount is being managed by a trio consisting of George Cheeks, Brian Robbins, and Chris McCarthy. However, this arrangement is intended to be temporary. Skydance’s David Ellison is set to assume the role of chairman, while Jeff Shell will become president in due course.
This business reached its current state due to a chaotic succession period at Paramount, marked by Sumner Redstone’s scandalous behavior with multiple women, which allowed Philippe Dauman to allegedly plunder the company. Unfortunately, Shari Redstone, who endured public criticism from her father and managed to maintain power despite his deteriorating condition, stepped into leadership just as the digital revolution, streaming services, pandemic, and poor management were causing significant damage. It’s worth noting that she too has made several questionable decisions exacerbating the situation.
The fact that Ted shares CEO responsibilities with Reed Hastings at the company is intriguing, but it becomes a different story when another person takes a leadership role alongside you. Paramount’s recent struggles, from Dauman to Bob Bakish and now to an interim “office of the CEO” before Ellison takes over, are reminiscent of the power struggle within Rupert Murdoch’s family, currently unfolding in a courtroom in Nevada. The uncertainty surrounding what the children of a media mogul will do with the empire their father built is similar to the confusion regarding the succession of the Murdoch dynasty. While we can speculate about the potential outcomes if Rupert succeeds in altering the trust and Lachlan Murdoch takes charge, it’s equally important to consider what might happen if he fails.
The succession at Murdoch’s empire is in disarray. Lachlan, once seen as Rupert’s preferred heir, fell out of favor years ago following a stint under the controversial Roger Ailes at the news network. Lachlan was manipulated like a plaything, demonstrating Ailes’ power to control even Rupert’s son. Next came James, who is less extreme in his political views than his brother, but was tainted by his handling of the News Corp phone hacking scandal. Elizabeth might have been the best choice, but she didn’t seem interested. Now, Rupert has returned to Lachlan, who is reportedly more conservative than his father. The old man is attempting to modify an unchangeable trust to prevent Elizabeth, James, and possibly Prudence, his eldest child who has stayed out of the fray, from taking control. This could potentially keep Fox News from disseminating lies that have eroded democracy and cost the company nearly a billion dollars so far. However, it’s uncertain if the rules of this trust can accommodate such changes, especially when they serve to maintain an aging man’s propaganda machine.
User: Indeed, altering an irrevocable trust can be quite a challenging task. As it stands now, when Rupert passes away, his four adult children are said to each receive an equal number of votes. The offspring from his relationship with Wendi Deng will only inherit the economic interests but not the voting rights. If things remain as they are, Lachlan might face opposition from James, Elizabeth, and Prudence, who collectively may decide to vote him out.
Masters: It’s unfortunate to imagine Lachlan being whisked away for surfing and rock climbing. I can’t help but ponder if the rock-climbing wall he built on the Fox lot is still standing. Frankly, I often feel a melancholy when I’m there – it’s filled with fascinating historic buildings and a realistic New York street setup. I’m uncertain about the future of that lot – I believe it remains idle for quite some time – but now, it’s under Disney’s ownership. And as we delve into the topic of succession drama…
User: It seems that Hollywood is paying close attention to Disney’s leadership transition, as Bob Iger’s influence is significant and the events surrounding his stepping down and passing the CEO role to Bob Chapek have caught everyone’s attention. In fact, Iger has openly expressed his preoccupation with identifying a suitable successor and has been actively reviewing what went wrong during his previous departure.
From my perspective as a dedicated fan, it seems the notable shift this time around is the increased involvement of Disney’s board members. Previously, when Iger appointed Chapek, the board seemed to merely endorse the decision without much active participation. As Institutional Shareholder Services stated in their report supporting Nelson Peltz earlier this year: “It appears that there was no formal interview process mandated by the board, and they primarily relied on Iger’s judgment in making this choice.” However, this time around, I sense a greater role for the board in making decisions.
There’s a lot of discussion about the ongoing competition, which is captivating the entire town. Several executives have expressed strong opinions that Dana Walden would be an ideal choice for the CEO position at Disney. They argue that her ability to work well with creatives and her exceptional networking skills make her stand out. Moreover, it could be a significant moment for Bob Iger if he were to appoint the first female CEO of Disney. Some have suggested that Hugh Johnston from Pepsi, who was recently hired as CFO to replace Christine McCarthy, could provide sufficient operational support for Dana, depending on her preferred direction. However, there are other executives who believe that Dana lacks the necessary operational experience to manage a company as large as Disney. It’s important to note that Dana has a background at Fox, which was acquired by Disney, and this could be a point of contention among longtime Disney insiders. For instance, Peter Rice, who was groomed by Rupert Murdoch to become a CEO while he was at Fox, was replaced due to his ‘Foxyness’. One executive I spoke with stated, “Disney is not in Dana’s DNA” and described her as “fancy”. This same executive also expressed skepticism about any outsider having a chance. Additionally, it’s worth mentioning that Dana is friends with Kamala Harris, which could be advantageous or detrimental at the present time. Conversely, there are those who support Josh D’Amaro, who oversees the theme parks and seems to emulate Iger in terms of style and presentation, as a potential candidate for the CEO position.
One clear advantage Josh has, beyond his operational expertise, is that he witnessed Chapek’s mistakes and likely won’t repeat them. However, Dana’s creative connections should not be underestimated. It’s questionable if an outside candidate could ever fill this role. The board reportedly met with NBA commissioner Adam Silver last year, but it seems neither party found a suitable match. Perhaps there isn’t any outsider who can fit the requirements, and the board and Iger are hoping that insiders like Walden and D’Amaro, or ESPN’s Jimmy Pitaro, or even Asad Ayaz, the CMO, have the necessary skills and can learn quickly, possibly in a COO position. In essence, they hope these individuals can do what Iger did himself – learn on the job.
Masters: However, he didn’t seem to grasp the lesson from Michael Eisner’s downfall, who eventually thought of himself as Disney. The flattery that comes with a successful CEO can lead to such a belief, but Walt’s nephew Roy disagreed and in the end, so did the shareholders. As Jon Dolgen once put it to me, “No one ever walks away from the table in this town. You think the Queen of England wants to be just some wealthy old woman?” Yet, the Queen of England was royalty. In Hollywood, nobody is, despite how appealing the Kool-Aid may seem.
Originally, this tale was published in the October 9th edition of The Hollywood Reporter’s magazine. If you’d like to get the magazine delivered, simply click here to subscribe.
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2024-10-14 18:55