You will be redirected back to your article in seconds

Bob Iger’s Daunting Puzzle: How Will Assets, Leaders Integrate in Fox-Disney Merger?

Getting a $52.4 billion deal inked with Murdoch was the easy part.

Now, Bob Iger is hip-deep in the hard work of hammering out a new management structure for the enlarged company once Disney’s acquisition of 21st Century Fox assets is complete.

Ask any industry executive who has been through a megamerger. The integration of assets, people and corporate cultures is an arduous process even in the best of circumstances.

Organizationally, the union of Disney and Fox, first unveiled Dec. 13, is arguably the most complicated of any merger in memory because it involves two major film and TV studios, unlike that of Comcast’s purchase of NBCUniversal or AT&T’s pending acquisition of Time Warner.

“This involves much more integration than we’ve ever witnessed in our business,” said one executive involved in the situation.

The combination is also happening in a fishbowl because of the prominence of both companies and the top executives at Fox and Disney who suddenly become available for possible poaching by rivals. It’s expected to take 12 to 18 months for the deal to close. That’s a long period of uncertainty for executives on the studio lots of the two firms.

Iger has been hunkering down with his top strategists — including Kevin Mayer, Disney’s chief strategy officer, and Alan Braverman, Disney’s general counsel — to map out the new management blueprint.

For now, knowledgeable sources insist the structure of the expanded Disney is still very much a work in progress and Iger has told insiders it will likely be months before a final plan is hatched.

In the meantime, he has been taking a whirlwind series of get-to-know-you breakfast and lunch meetings with key Fox management teams in film and TV.

The only thing that’s certain at this point is that there will be shake-ups ahead for leaders at both companies, particularly in the area of film and TV production, where there is clear overlap between Disney’s existing operations and the 20th Century Fox studio. Also part of the deal are the FX Networks cable group, National Geographic Worldwide and Fox’s interests in Hulu, Endemol Shine North America and European satcaster Sky.

However, the one common denominator in all of those assets is content (even Sky has stepped up its original production activity). Disney needs to prime more content pipelines to fuel the ambitious direct-to-consumer global entertainment-streaming venture it intends to launch by the end of next year. The range of options that the various Fox units deliver will go a long way toward allowing Disney to offer a more diversified menu of programming as it moves into the direct-to-consumer arena. But getting that material to the screen requires that the right managers and processes be set in place — all of which amounts to a Rubik’s Cube challenge for Iger, because until he can lay out a structure, there’s no certainty that key players at Fox will make the leap to Disney.

On the TV side, there has been a tsunami of speculation about who among the Fox ranks will move to Disney and who will stay with the company dubbed (for now) New Fox.

The most pressing question for Iger is likely sketching out a scenario for Fox Television Group chairman and CEO Dana Walden, whose employment contract with Fox is set to expire later this year. A seasoned executive with stellar industry relationships, Walden has no shortage of options in front of her. Recruiting her would be a coup for Disney, but after 20-plus years in the executive ranks, Walden may be up for a change. There’s chatter that she may team up with über-showrunner Ryan Murphy in a production venture, although sources say there’s nothing concrete yet on that front. A knowledgeable source said a big priority for Walden is to land in a way that allows her to work with a range of creative partners and showrunners with whom she has had long and fruitful relationships.

Like Walden, Murphy is much in demand thanks to his track record as a hitmaker for FX and Fox — and because his overall deal with 20th Century Fox TV is set to expire at the end of July. If Walden and Murphy were to team up or hit the marketplace as free agents, there would surely be a line of suitors — a dynamic that adds urgency to Iger’s decision-making.

Walden’s business partner at Fox since 1999 has been Gary Newman, chairman and CEO of Fox Television Group. There’s been speculation that he’s being courted to stay with New Fox to help guide the post-Disney transition. But Newman also has the background and the résumé to be an attractive hire for any media company.

If Walden or Newman is bound for Burbank, the ramifications will undoubtedly impact Disney/ABC TV Group’s existing management hierarchy, led by president Ben Sherwood. At a time when Disney is already looking for a new leader for ESPN (which runs separately from Sherwood’s group), Iger has his hands full trying to sort out who’s coming, who’s going and who’s moving.

The path for Peter Rice, president of 21st Century Fox, who oversees all TV operations at present, is also a big question mark. Rice’s deep background in film and TV for nearly a decade makes him also highly sought after by rivals to Disney and Fox. If Rice opts to stay with New Fox, it will be a strong sign that he intends to grow the company through acquisitions.

After Disney scoops up its 21st Century Fox purchases, New Fox will be left with the Fox broadcast network and TV station group, and the Fox News and Fox Sports cable operations. Already there is movement at Fox to buy more Fox-affiliated TV stations in midsize markets that will soon be on the block as the result of another megamerger — Sinclair Broadcast Group’s acquisition of Tribune Media.

FX Networks chief John Landgraf is expected to bring his FX, FXX and FXM cablers to Disney with a measure of autonomy. As Landgraf pointed out to journalists earlier this month, Disney has no comparable cable channels in its portfolio at present, and Iger has been complimentary about the brand that Landgraf & Co. have built. However, there has been no formal statement of Disney’s plan for FX Networks or Landgraf.

Landgraf has made it clear that his mission is to maintain as much continuity at FX Networks as possible. He pointed to Iger’s track record of allowing Pixar, Marvel and Lucasfilm to maintain their respective cultures and quirks even as they were absorbed into the world’s largest media company. The biggest question for Landgraf seems to be whether he would be given — and whether he would want — expanded turf. There was instant speculation about Disney handing the keys to Hulu to Landgraf after it becomes the majority owner of the streaming service.

On the film side, the smart money has the Fox Searchlight duo of Nancy Utley and Stephen Gilula moving their group over largely intact. Similar to the FX Networks scenario, Disney has no comparable specialty film division at present and needs the adult-oriented fare that Searchlight is known for in order to add dimension to its film business. The success of Searchlight’s movies relies heavily on the reach of Fox’s international global distribution apparatus. That begs the question of how those far-flung executives might be integrated with Disney’s distribution operation.

The picture at Big Fox is less clear. 20th Century Fox chairman-CEO Stacey Snider and vice chairman and president of production Emma Watts are both deeply experienced and respected executives. Meanwhile, Walt Disney Studios president Alan Horn has been on a torrid run with box office hits reliably delivered by Disney’s Marvel, Pixar and Lucasfilm banners. At one point, Horn was looking to retire in June. But when Iger agreed to extend his contract with Disney on the heels of setting the Fox pact, Horn agreed to stay on until December 2019.

The executive moves spurred by the deal aren’t limited to various Fox and Disney division heads. There’s some family intrigue, too, as the fates of 21st Century Fox chairman Lachlan Murdoch and CEO James Murdoch are less than clear. Rupert Murdoch has indicated that he wants Lachlan to run New Fox, although Lachlan has yet to make a formal commitment to doing so, according to a knowledgeable source. James Murdoch internally has made it understood that he will not remain with New Fox after the Disney deal is completed. At this juncture, insiders say it doesn’t appear there’s a role at Disney for the younger of Rupert Murdoch’s two sons and that James is likely to strike out on his own.

With so many moving parts in play for so many boldface names, only time — and Iger’s ultimate organizational chart — will tell.

Executive Derby

Leaders of Disney and Fox are in for shake-ups and shuffles once the integration of the two companies begins in earnest.

James Murdoch
CEO, 21st Century Fox
Joined Fox: 1996

The younger son of Rupert Murdoch is said to have made it clear internally that he is not staying with New Fox. While his future doesn’t likely include a move to Disney, insiders speculate that he may be more prone to strike out on his own.

Lachlan Murdoch
Executive chairman, 21st Century Fox
Joined Fox: 1994-2005 and 2014-present

Rupert Murdoch has indicated he hopes to see his older son leading the New Fox operation. Lachlan is known to be more attuned to the news, sports and live events businesses that will be the focus of New Fox, but as yet, Lachlan has not tipped his hand.

Peter Rice
President, 21st Century Fox; chairman-CEO, Fox Networks Group
Joined Fox: 1989

The future of the highly regarded executive is far from certain. There’s as much chance he could end up in a top role at Disney as there is he could stay with the Murdochs. Or, he could break away from Fox, where he’s spent his entire career, and join a competing media company.

Dana Walden
Chairman and CEO, Fox Television Group
Joined Fox: 1992

Walden is being courted for a top job at Disney. There’s also chatter she might partner with Ryan Murphy in a production venture. There’s an urgency for Walden’s decision-making because her contract is up later this year.

Gary Newman
Chairman and CEO, Fox Television Group
Joined Fox: 1990

Speculation is that Newman remains with New Fox as a key player in guiding the company through the post-Disney transition. But as is the case with Walden, there are several scenarios that could play out for her longtime business partner.

John Landgraf
CEO, FX Networks
Joined Fox: 2004

Landgraf would seem to have the clearest path to continuing in his present role, porting over the FX, FXX and FXM channels and FX Prods. to Disney, which has no comparable cablers.

Stacey Snider
Chairman-CEO, 20th Century Fox
Joined Fox: 2014

Snider’s future after Fox’s film operations move to Disney is unclear. Snider’s long resume, having run Universal and DreamWorks prior to Fox, gives her options at a time when there is no shortage of capital chasing content ventures.

Emma Watts
Vice chairman, president of production, 20th Century Fox
Joined Fox: 1997

There’s a good chance Watts could wind up in a top movie role at Disney, with or without Snider.

Ben Sherwood
Co-chairman, Disney Media Networks; president, Disney/ABC Television Group
Joined Disney/ABC: 1989-93, 2004-6, 2010-present

Sherwood could be gaining turf — or not — as Disney/ABC enlarges its TV operation.

Alan Horn
Chairman, Walt Disney Studios
Joined Disney: 2012

The lingering question about the seasoned studio chief is whether he’ll stick around until his contract expires in December 2019 or retire earlier.

Nancy Utley, Stephen Gilula
Presidents, Fox Searchlight Pictures
Joined Fox: 1986 (Utley), 2000 (Gilula)

Disney is expected to let the duo continue running the successful indie film operation behind such Oscar-nominated films as “The Shape of Water” and “Three Billboards Outside Ebbing, Missouri.” What remains unlear is how autonomous they’ll be at their new home.

More Film

  • MoviePass card

    MoviePass Parent Target of Fraud Probe by NY Attorney General

    Getting a $52.4 billion deal inked with Murdoch was the easy part. Now, Bob Iger is hip-deep in the hard work of hammering out a new management structure for the enlarged company once Disney’s acquisition of 21st Century Fox assets is complete. Ask any industry executive who has been through a megamerger. The integration of assets, people and corporate cultures […]

  • First Reformed

    Ethan Hawke's 'First Reformed' Leads Gotham Awards Nominations

    Getting a $52.4 billion deal inked with Murdoch was the easy part. Now, Bob Iger is hip-deep in the hard work of hammering out a new management structure for the enlarged company once Disney’s acquisition of 21st Century Fox assets is complete. Ask any industry executive who has been through a megamerger. The integration of assets, people and corporate cultures […]

  • MeToo Placeholder

    #MeToo: Bollywood Takes Steps to Curb Sexual Harassment

    Getting a $52.4 billion deal inked with Murdoch was the easy part. Now, Bob Iger is hip-deep in the hard work of hammering out a new management structure for the enlarged company once Disney’s acquisition of 21st Century Fox assets is complete. Ask any industry executive who has been through a megamerger. The integration of assets, people and corporate cultures […]

  • avengers infinity war

    Germany Expands Rebate System for VFX Sector

    Getting a $52.4 billion deal inked with Murdoch was the easy part. Now, Bob Iger is hip-deep in the hard work of hammering out a new management structure for the enlarged company once Disney’s acquisition of 21st Century Fox assets is complete. Ask any industry executive who has been through a megamerger. The integration of assets, people and corporate cultures […]

  • Nigerian Prince

    Film Review: 'Nigerian Prince'

    Getting a $52.4 billion deal inked with Murdoch was the easy part. Now, Bob Iger is hip-deep in the hard work of hammering out a new management structure for the enlarged company once Disney’s acquisition of 21st Century Fox assets is complete. Ask any industry executive who has been through a megamerger. The integration of assets, people and corporate cultures […]

More From Our Brands

Access exclusive content