In November, Disney Corporation announced the reappointment of Bob Iger as CEO, replacing Bob Chapek who had taken over as CEO earlier in 2020 amid the COVID-19 pandemic. Iger’s return to the company was met with surprise, as he had previously announced his retirement after serving as CEO and chairman of Disney for 15 years and being a key figure in the company’s growth as an international media conglomerate. However, the change in leadership has been celebrated as Iger is known for bringing creativity and passion to the company and focusing on its growth and expansion, especially as the company looks to move beyond the pandemic. With Iger’s appointment, there is a sense that Disney may have to shift its goals, as its stock price has fallen significantly over the past year and it faces increasing competition across its divisions.
One area of change for Disney will be the organization of the corporation itself. Despite choosing Chapek as his successor in 2020, Iger has been vocal about his dissatisfaction with Chapek’s actions as CEO, particularly the organization of the company. Under Chapek, Disney focused more on its own streaming service, Disney+, as restrictions on in-person activities such as theme parks and cruises made it a lucrative source of revenue. However, this focus led to an overload of efforts on Disney+ and attempts to differentiate from competitors such as Netflix, Hulu, and HBO Max. As a result, Disney+ prices rose from around $8 to almost $11, and Chapek even proposed an ad-supported version that would cost just a few dollars less than the ad-free service. Chapek also altered the roles within the Disney Media Entertainment Division (DMED), which Iger had established in 2018 as Disney prepared to expand its global media presence. In a recent press release after being appointed CEO, Iger stated that his main focus will be on reorganizing the company in a way that works for all Disney employees, with an emphasis on the increased focus on theme parks and cruises in 2022.
Another area of change for Disney will be its streaming service. In the past year, Disney’s stock price has fallen by more than 40%, the worst year for the company in over 15 years. This decline can partly be attributed to the lack of success of its streaming service, which now competes with Netflix, Hulu, Peacock, and other companies that are continuously updating and promoting their services. Despite having a large catalog of content from studios like Marvel, Pixar, and others, Disney’s profits from Disney+ have been disappointing in recent months, including the lowest reported revenue for Disney in the most recent quarter. Iger plans to focus on creating a bundle with other streaming services, such as Hulu and ESPN+, in order to make Disney a more comprehensive streaming service compared to its competitors. This will involve negotiating with Comcast, which owns a 33% stake in Hulu, a process that Chapek had already started but that Iger hopes to complete by 2023. To remain competitive in the media industry, Disney must also continuously provide exclusive content for its billions of fans, which has been a challenge due to falling prices and competition from shows like “House of Dragons” and “Rings of Power”.
The sudden reappointment of Bob Iger as CEO brings hope for Disney as it looks to turn around a difficult fiscal year. While the company has the resources and properties to make these necessary changes, many are waiting to see how Iger’s leadership and strategies will impact the company’s future.