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Challenges faced by Disney Chairman Rich Ross

Don't let the toxic times, ruin a great gig

Memo: To Rich Ross

From: Peter Bart

Now that you have joined the elite fraternity of studio chiefs, Rich, I trust that you are prepared, not only for the highs of the job, but also for the hazards. The Disney empire embodies a great brand, but these are tough times to take over any top corporate job. Apart from the soft economy, you must also confront the residual shockwaves triggered by the abrupt departure of Dick Cook, who had his long-term allies in your corporate family.

The creative community is eager to find out, Rich, how you will go about balancing the formidable power players of the Magic Kingdom — Lasseter, Spielberg, Bruckheimer and the like. They, and others, will compete for resources, prime release dates, generous P&A allocations and plain old ego space. Cook seemed talented at managing these power pods even though he was not great at returning phone calls.

And while Bob Iger has gained respect for infusing corporate discipline and civility, he has yet to demonstrate his skills at mobilizing creative energies. Michael Eisner, who came to power 25 years ago at Disney, emphasized toleration for a “core of craziness” within any creative business — one that must be leveraged with appropriate controls and limitations. While Eisner won admiration for instilling innovative energy, some felt he also exacerbated the “craziness” by his own idiosyncratic behavior.

Traumatic events like the death of Frank Wells, the departure of Jeffrey Katzenberg and the operatic fall of Michael Ovitz created a certain paranoia within the Disney organization, one that Iger has seemed successful in overcoming. But, still, Disney is a company that is re-inventing itself, and that process itself causes a systemic nervousness that can inhibit creativity.

These are issues you will have to deal with, Rich, along with the customary tribulations of your position. For example:

— As deals get tougher at every level of the entertainment economy, you will be the “heavy,” not the hero, in most negotiations.

— You are regarded as a “TV person,” Rich, and filmmakers are worried whether you understand their problems. “He’s great at kids’ TV, but can he cope with the stresses of $100 million movies?” asks one of your producers.

— You’ve operated in the past within a protective corporate cocoon, Rich, but in your new job your every comment will be magnified by the press and by snarky bloggers. You will feel that the media wants you to fail, and to some degree you are correct.

Though your road ahead is filled with potholes, here’s the good news: The Disney empire, Rich, is the powerhouse of global entertainment. Roy Disney liked to say that he hated the concept of “branding,” but you have an amazing brand on which to build and the worldwide family audience has proved to be a loyal one.

That will provide you with an enormous cover, Rich, but that protection has its limits. The explosion of the DVD business helped fuel a spectacular boom in Hollywood, one that lifted the community’s expectations and appetites. But now that the air has gone out of the DVD balloon, and the gap between the demands of the corporations and those of the artists who contribute the content is causing a toxic atmosphere.

So that’s the potential trap, Rich: You can’t let the toxic times ruin the great gig. We wish you good luck on that venture, ’cause you’ll need it.

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