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FX Chief John Landgraf on Disney Deal: ‘We Have What They Want’

FX Networks CEO John Landgraf voiced optimism for his cable group making a smooth transition to Disney ownership in part because Disney does not have any similar channels in its existing TV group.

On the surface, FX’s edgy brand of premium adult-oriented programming would seem a bad fit with Disney’s family-friendly brand. But Landgraf told reporters on Friday that he heard directly from Disney chairman-CEO Bob Iger that Disney pursued the $52.4 billion deal with 21st Century Fox because it wants to expand the scope of its TV production operations. Moreover, Iger told Landgraf that he is a fan of the work turned out by the FX Networks group.

“We have what they want,” Landgraf said. “The oddness that (FX) is so different from Disney’s brand is a good thing. It means that what we do and expertise that we have doesn’t exist currently inside that company.”

Landgraf was pressed during his Q&A session at the winter Television Critics Association press tour in Pasadena, Calif., about his future in the enlarged Disney. He maintained that there have been no formal plans laid out to him about how FX Networks will plug into Disney’s existing hierarchy, assuming the deal is approved by federal regulators, nor has he spoken with Iger or anyone about his role.

Disney’s pursuit of 21st Century Fox assets is clearly a response to the upheaval in the marketplace wrought by the entry of deep-pocketed streaming services. Disney needs the content generated by the Fox assets it hopes to acquire in order to compete on a global scale. Landgraf has been among the most vocal TV executives sounding the alarm about the challenges for traditional linear TV outlets in competing with companies that have much greater resources.

“One of the reasons (Disney) is getting bigger is to be able to compete against the global streaming services,” Landgraf said. FX Networks is poised to become the adult premium content hub for that larger effort. Although there are many unasnwered questions about how Disney will implement that vision, “we can see with clarity that they believe (premium series) is a really good thing to invest in. It drives consumer interest with a streaming service. We end up becoming the adult scripted component of their larger plans.”

Landgraf opened his session with a warning about the deleterious effects on the national psyche by Internet-driven pop culture that he said too often descends into a “daily three-ring media circus.” He echoed the words of Edward R. Murrow in the early days of television with his grave assessment of how the connectivity of the current age is influencing all aspects of media, society and culture.

The unruliness of social media platforms and other Internet-driven communications are concerning, especially as that massive platform is controlled by a handful of tech giants, Landgraf said. He didn’t name names but it was clear he was referring to the companies that have become known as FAANG: Facebook, Apple, Amazon, Netflix and Google.

“We have the most powerful tool for distributing, selecting and shaping information the world has ever known, but those who control it are not held to any firm standard of legal or moral accountability in return for the huge profits and power they derive,” he said.

Joining forces with Disney and its formidable roster of content-producing brands “will undoubtedly help our brand to remain competitive and relevant into the future and through the peak TV era,” Landgraf said. “As the largely unregulated Internet platform looks to become world-swallowing, trillion-dollar companies, Hollywood, and its quaintly old fashioned focus on storytelling, has no choice but to seek the scale needed in order to compete.”

The influx of money chasing talent delivered by Netflix et. al to the creative community has “put an enormous amount of pressure on the business” of traditional linear TV, he said.

Landgraf said he genuinely has no sense of how the enlarged company will be organized. He believes it’s a work in progress within Disney, and he noted that Disney and Fox are prevented by laws and Securities and Exchange Commission rules from doing much in the way of integration before the deal is formally closed. That process is expected to take 12 to 18 months.

“I honestly don’t think they know yet how to organize this vast new company,” Landgraf said. “It’s going to take time to work it out.”

But Landgraf, who has headed FX for the past 15 years, has faith that Disney under Iger’s leadership will be careful not to disrupt the unique culture within the tight-knit FX Networks team. Landgraf cited Disney’s stewardship of Pixar as a good example of how Disney allows units to operate with autonomy. He noted that FX Networks has about 270 employees, much smaller than other cable groups of comparable size.

“We can’t do what we do if we’re not allowed to maintain the integrity of our culture,” he said. “I have every optimism that Disney will understand and support that. They want what we have which is extraordinary television, critical acclaim, Emmys … They’re going to want the best of what we have to offer.”

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