Jerry Bruckheimer and his team thought they were on their way to making a mega-budgeted World War II saga called “Pearl Harbor” in 2000 when the man who approved the project, Walt Disney Studios chief Joe Roth, suddenly left the company.
Rather than hand the project off to Roth’s successor, Peter Schneider, chairman Michael Eisner entertained second thoughts. Suddenly, the fate of “Pearl Harbor” was not in the hands of the new studio chief; it was mired in Disney’s corporate maze, stuck in the office of a man named Peter Murphy.
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After calculating the risks and potential windfall based on an earlier Bruckheimer blockbuster, “Armageddon,” Murphy drew up the financial projections that could guide the project to success.
The movie eventually got the greenlight. The budget was $135 million, a hefty sum, but still one that forced Bruckheimer, director Michael Bay and the entire crew to take pay cuts, in exchange for a piece of the backend. By Murphy’s projections, the film would match, if not exceed, “Armageddon,” which grossed $201 million domestically. Eisner began predicting a hit. Yet when “Pearl Harbor” delivered $199 million, it was considered a disappointment.
Never heard of Peter Murphy? He’s senior executive vice president and chief strategic officer of the Walt Disney Co. He’s Ivy League educated, wonkish and smart, and very different from most of the creative execs, writers and producers with whom he works.
He’s now involved in deals affecting almost every sector of the company. As a member of Eisner’s inner circle, he’s a man on whom the Disney chief relies to reinforce his decisions — or make good on those that Eisner second-guesses.
And, to hear critics talk, he’s indicative of one of Eisner’s chronic problems. Many corporate execs at Disney, while hardworking and well-intentioned, are not well-versed in finessing members of the creative community. Like oil and water, the left- and right-brain types often clash. When Eisner changes his mind (as he did with the acquisition of Cap Cities/ABC and, later, over the terms of the deal to buy Fox Family Channel), it is Murphy who goes into battle with the proposed revisions.
As it is, strategic planning is becoming a rallying point for a number of vocal Disney critics.
In his campaign to oust Eisner, Roy Disney has said the Disney chief is running the company with “so-called strategic planners” in a “soulless, rapacious (search for the) quick buck.” Pixar’s Steve Jobs knocked the company for being short on creativity and long on “embarrassing” animated sequels.
Even Disney’s directors have taken note. According to one insider, some directors at a board meeting last year complained that there were more strategic planners than animators at Uncle Walt’s studio. Eisner turned to Murphy and asked rhetorically, “Why do we need so many accountants?”
But Eisner’s comments were disingenuous at best, says one source. “Peter is not making these decisions. Michael is. Peter’s just the fall guy.”
In fact, Murphy is a very tough fall guy, a loyal company man who has worked for Disney ever since he graduated from the Wharton School of Business in 1988. Other colleagues have left, some for lucrative positions at other companies, others to escape the often unnerving way that Eisner runs the company.
Murphy, however, steadfastly supports his boss, defends the company’s moves and talks in fluent corporatese, as when he calls Disney a “branded content delivery company.” He will play a critical role in the coming months as Eisner pursues new deals and directions to fend off takeover threats from outsiders like Comcast.
But few ever hear about Murphy’s starring role, as he flies below the radar. Even at the Disney gates, a security guard looks befuddled when Murphy’s name is mentioned. “We’ve never heard of him. Do you know what he does?”
To the creative types, however, Murphy is among those who deliver the news on whether a dream project will work or whether a venture has to be shut down. While Walt Disney Studios chairman Richard Cook oversees features, Murphy has been called in to size up prospects for big-budgeted film projects like “Pearl Harbor.” Some have gone so far as to call him Eisner’s “enforcer.”
One of the few times Murphy made the news was in 2002, when EchoStar threatened to pull ABC Family off its sat system. According to court documents, Murphy allegedly warned an EchoStar executive that if he pulled ABC Family from its schedule, Disney would “march on Washington” to oppose the satellite provider’s pending merger with DirecTV. Murphy later denied the exchange, and EchoStar’s merger eventually fell through.
Perhaps nowhere has Murphy’s presence been felt more than at Miramax, where Harvey and Bob Weinstein’s relationship with Eisner runs hot to cold. Roth had been Miramax’s point man at Disney, but when he left, Murphy began to play a bigger role. The maverick producers started dealing with a strategist who was not known for cultivating creative relationships.
It is Murphy, for instance, who delivers orders to Miramax to pare budgets and meet projections. The jousting has gotten so extreme that Miramax execs have groused that they wish the strat planners would “just leave us alone.”
According to insiders, Murphy has tried to revise the Weinsteins’ accounting and bonus structures to conform to Disney’s more rigid practices.
As one Miramax manager bristles: “They squeeze people and don’t reward them for jobs well done.”
Skip Brittenham, the Weinsteins’ attorney, is much more diplomatic: “Peter is a very capable guy who is a good listener.”
Murphy looks like a former hockey player, a bit portly in girth and ruddy in complexion. Wire-framed glasses make him look older than his 42 years, and a dazzling white smile and fleshy lips soften his square face. He speaks quickly in a flat voice with a hint of Yankee yaw.
From atop the Team Disney building in Burbank, he disputes his role as Eisner’s enforcer, explaining as his face flushes, “This is a company with $27 billion in revenue and dozens of divisions. Michael and (Disney president) Bob Iger need help in running the company and a lot of things get delegated.”
Despite the criticisms of Eisner, colleagues praise Murphy as a brilliant thinker. Indeed, some of his recent ventures include MovieBeam, a video-on-demand service that has garnered positive reviews. His recent agreement to license Microsoft’s antipiracy software was all but obscured two days before the news of Comcast’s takeover bid. Yet the Microsoft deal could ultimately protect Disney’s films and content for the digital world of PCs, TVs, PDAs and cell phones.
“He’s one of the smartest guys I know,” says Rob Moore, a former Walt Disney Studios executive who is now a partner at Revolution Studios. Stephen Bollenbach, the Hilton Hotels chairman who was Disney’s chief financial officer during the acquisition of Cap Cities/ABC in 1995, says he’s “got all the right credentials, is well-educated and works real hard.”