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Bob Iger’s Major Slip-Up Could Ultimately Be What Kills Disney

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Disney’s Bob Iger can’t seem to separate himself from a decision he made at Disney four years ago–one that has come under heavy scrutiny and could land the company in a downward financial spiral.

RELATED: Thousands of Disney Employees Take a Stand Against Bob Iger’s Stern New Directive

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Bob Iger has only been back at the helm of the Disney ship for a few months, but in that short timespan, The Walt Disney Company has been in the headlines several times. Though many Disney fans were thrilled, news of Disney’s removal of former CEO Bob Chapek sent shockwaves throughout the Disneyverse, but no one could have imagined that the board would recall veteran CEO Bob Iger–who retired on December 31, 2021–to the post of Disney’s chief executive officer.

RELATED: Fare Thee Well, Mr. Iger, and Thanks for Everything

When Iger stepped back into the role, the House of Mouse was a shambles, to say the least. Diehard Disney fans made up a majority of the steady stream of visitors at rival Universal’s theme parks, signaling a dissatisfaction among many who had long loved the Mouse. And only two weeks before Chapek’s removal, the company shared some of the most dismal earnings numbers in recent years. Cast Members throughout the Florida parks were in the middle of heated, unproductive negotiations with Disney when it came to wages, and the company was made the “Worst of the Woke” list for the second year in a row.

Disney's Strange World to Lose $100 Million: Why It Flopped at Box Office - Variety

Credit: Walt Disney Animation

RELATED: Former Disney Animator Reimagines Attraction: “It’s a Woke World After All”

Clearly, the company had zero confidence in Chapek’s ability to continue in his role, bringing in Iger to save the day. But the 72-year-old Disney alum may owe restitution first, as a decision he made at Disney in 2019 continues to come back to haunt him.

During his tenure as CEO at The Walt Disney Company, Bob Iger spent untold hours navigating the ins and outs of bolstering the kingdom of the Mouse. He’s credited with expanding Disney’s scope by frontlining dozens of acquisitions, buying up Miramax, PIXAR, Lucasfilm and Star Wars, Marvel, and a laundry list of other entities. Overall, those acquisitions were seemingly positive ones, and the returns in revenue on most have proven Iger’s prowess in making solid business decisions.

One of Iger’s buy-ups in 2019 is netting him big headaches in 2023, however. But the general public might not know that, thanks to an undeniably successful film called Avatar: The Way of Water by veteran filmmaker James Cameron. Disney has the rights to plaster its name all over the new blockbuster that just broke into the two-billion-dollar box office club, thanks to an acquisition that took place in 2019 in which the Mouse bought 21st Century Fox.

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In late January, The Wrap pointed to the Disney Fox deal as one of Disney CEO Bob Iger’s biggest mistakes:

“As adult-skewing movies struggle in theaters and Wall Street changes the rules in the streaming war, Disney’s purchase of Fox’s studio properties may prove to be Iger’s biggest blunder, dealing lasting damage to the company’s reputation among shareholders for media-merger magic. The idea that Disney could take any given property, get audiences to associate it with its megabrand, and make it an even bigger cross-platform commercial success was part of how it sold Wall Street on the notion of total entertainment dominance.

Now Iger has the harder challenge of squeezing performance out of an existing portfolio. He may not be able to buy his way out of this one.”

During his doomed plight to score a seat on Disney’s board, activist investor Nelson Peltz of Trian Partners attacked Iger’s track record of Disney Company acquisitions, paying special attention to the 2019 Disney Fox deal that cost Disney more than $71 billion. It did not include all of the Fox assets, even at that price. Despite the massive investment on Disney’s part, the Mouse House only has ownership of 20th Century Fox, Fox Family, 20th Century Fox Animation, Fox Searchlight Pictures, FX Networks, and other Fox assets. But Disney gained no ownership of Fox News, Fox Sports, the Fox Network, or Fox TV stations. All of those belong to the stand-alone Fox corp.

In January, Iger came out swinging, countering Peltz’s attacks and defending his long list of successful acquisitions. Peltz started a proxy battle hoping to land a spot on the board, saying Disney is a “company is crisis” and in need of an intervention.

Disney Prepares for a Board Fight by Nelson Peltz - The New York Times

Activist Nelson Peltz/Credit: The New York Times

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“Nelson Peltz does not understand Disney’s businesses and lacks the skills and experience to assist the board in delivering shareholder value in a rapidly shifting media ecosystem,” Disney said in a securities filing, adding that Peltz has no track record in media and technology and lacked operating initiatives, new ideas, and strategies, as evidenced by conversations between the board and Mr. Peltz.

But Peltz’s attack on Iger’s Fox deal has stirred up several heated debates. The deal was an extravagantly costly one, and as of 2023, Disney is still in debt because of it–to the tune of $45 billion. The House of Mouse is accused on “burying” Fox and ignoring a majority of its content while focusing almost entirely on Fox’s blockbusters.

Per Screenrant:

Disney’s progress toward a profit in the Fox deal has been slow. Films like “Avatar: The Way of Water,” which has grossed over $2 billion at the box office, help elevate the chances of Fox’s success, but ultimately eat away at the $45 billion in debt slowly, if Disney is to continue to neglect to invest in Fox the same way that they do other absorbing franchises. 

Marvel & Kevin Feige Currently Planning Out the Next 10 Years of the MCU

Credit: MovieWeb

Disney has absorbed other major studios, including PIXAR, Lucasfilm, and Marvel. The Marvel deal has been particularly successful for Disney, as the Marvel Cinematic Universe (MCU) films have been raking in box office revenue for over a decade. With so much of its energy poured into those MCU films, however, Disney could neglect Fox more in the process. This could create a self-perpetuating cycle, where the Fox loss gets worse as Disney focuses their attention away from them.”

Only time will tell if Disney is able to recoup its massive investment in Fox and begin to make a profit from the acquisition, but if the company’s trend of neglecting the larger part of Fox’s content continues, destruction looms for Disney as the company continues to bare the enormity of its debt from the 2019 purchase.

About Becky Burkett

Becky's from the Lone Star State and has been writing since she was 10 and encountered her first Disney Park when she was 11. It was love at first Main Street Electrical Parade. Joy is blank lined journals, 0.7 mm pens, and all things Walt, Woody and Buzz, PIXAR, Imagineering, Sleeping Beauty (make it blue!), Disney Parks history and EPCOT. At Disney World, you'll find her croonin' with the birdies at the Enchanted Tiki Room or hangin' with Woody and the gang at Toy Story Land. If you can dream, you really can do it!