SAD NEWS: Michael Eisner Is Leaving Disney - Sitcoms Online Message Boards

musicradio77 · 10-01-2005, 01:14 AM

As of right now, Michael Eisner is leaving Disney for good.

I've been a Disney fan forever because of Eisner's departure from the company. I want you to read this article from MSN's website:

How Did Michael Eisner Make Disney Profitable?

Not with cartoons.

By Edward Jay Epstein

Q. "How's your wife?"
A. "Compared to what?"
—Henny Youngman routine

What is the proper measure of a Hollywood mogul? For entertainment reporters, it's often a mogul's personal behavior. The more incidents of arrogance and insensitivity they uncover, the more they assume that a mogul is an ineffective leader. During the contentious period surrounding Michael Eisner's announcement that he was resigning from Disney, a frenzy of items appeared, casting him as a villain worthy of one of his animated hits. It will be recalled that Eisner alienated a host of would-be moguls—including Jeffrey Katzenberg (whom he called a "midget"), Michael Ovitz (whom he called a "psychopath"), Roy Disney (whom he kicked off the board), and Harvey Weinstein (whom he forced out of Miramax). These men, by one means or another, yielded an El Dorado of gotcha items to the press. What was lost in this morality tale was the story of Eisner's transformation of Disney. He turned a faltering animation-and-amusement-park company into one of the world's most successful purveyors of home entertainment. He'll depart as Disney's CEO quietly on Friday, without a gold watch ceremony. The lack of fanfare seems to mark him as a man who failed and sullied the good name of Mickey. But if you look at Eisner's metrics—the numbers that Wall Street believes are unambiguous indicators of a company's performance—Disney boomed under Eisner.

Eisner's Metrics, which are all public numbers:

Category 1984 2004 Percent change
Disney's Revenues $1.5 billion $30.8 billion +2,000
Disney's Income $294 million $4.49 billion +1,600
Disney's Tax-Free Cash Flow $100 million $2.9 billion +2,900
Stock Price (adjusted for splits) $1.33 $28.40 +2,100
Market Value $1.9 billion $57.4 billion +3,000
Disney's Enterprise Value
(market value plus debt minus cash)
$2.8 billion $69 billion +3,200

In 1984, when Eisner took command, the "Mouse House" produced only one animated picture every three to five years. Its entire film library had only 158 features, and its single cable channel, the Disney Channel, lost money. In addition, Disney had virtually no income from sales of videos. To keep afloat, the company depended on its amusement parks and its Mickey Mouse licensing. Yet even with these assets Disney had a tax-free cash flow of just $100 million. Its share price, reflecting this precarious financial position, was $1.33 (adjusted for splits).

In 2005, Disney was one of the richest companies in America. Its enterprise value—Wall street's favored measure of an entertainment company—had increased 32-fold since 1984 and stood at $69 billion. Its tax-free cash flow had increased 29 times, to $2.9 billion. Its film library had grown to 900 features, which were licensed on TV and sold on video and DVD, and its home-entertainment division accounted for nearly one-third of the revenues of the entire industry. Its share price, reflecting this robust health, had risen to $28.25.

Eisner's success becomes even more impressive when compared with his peers. Between 1984 and 2005, TimeWarner wrote off $99.7 billion; Vivendi-Universal, $40.6 billion; Viacom, $21.2 billion; News Corporation, $7.2 billion; and Sony, $2.7 billion. Among the six companies ("the sexopoly") that now dominate the TV industry, Disney alone did not write off any loss during this time.

How did Eisner succeed in adding $65 billion in enterprise value to Disney at a time when his rivals were faltering? Having come from television, Eisner saw that Disney's future would be in home entertainment—not in movie theaters.

Consider just two decisions he made that brought about this corporate transformation. The first came in the mid-'80s. At the time, Disney studio executives (including Katzenberg) were arguing that to release the company's beloved animated movies on video cassette would kill any profits to be made from re-releasing them in theaters. Eisner perceived the situation differently, and he put the videos into stores. Within a few years, video sales were providing almost all the profits for Disney's movie division and, by 2004, Disney raked in $6 billion from videos and DVDs sales.

The second decision came in 1995, when Eisner bought his old alma mater, Capital Cities/ABC, for $19 billion. With this single coup, Disney got not only the ABC network and TV stations, it also got 80 percent of a sports network, ESPN. Since the cable operators needed this sports network to attract subscribers, Disney charged them a "carriage fee" just for the right to intercept its satellite signals. Disney was able to ratchet up this charge, which is effectively a tax on cable households, by 20 percent a year, getting as much as $2 a month for every subscriber signed up by cable operators.

With the success of ESPN, Disney gained such enormous leverage over the entire cable industry that, in 2004, the company earned a record $1.94 billion in bottom-line operating income from its cable channels alone. To put this number in perspective, it was nearly triple the $662 million Disney earned from all its movie production and distribution, stage plays, records and music publishing, television library sales, videos, and even its booming DVDs (which accounted for about 80 percent of the $662 million).

These numbers did not go unnoticed by the fund managers who controlled two-thirds of Disney shares. As it became increasingly clear that Eisner had hit the jackpot with ESPN, these fund managers focused more and more on Eisner's inability to convert the enormous appreciation of Disney's assets into a stock-market payoff. One way to bring about that payoff would be to install new management who were willing to sell assets—even ESPN. Although Disney's shares had increased by 10.6 percent since 2001—which was a better performance than most of Disney's rivals—that was not enough to satisfy investors. In March 2004, 43 percent of shareholders voted to withhold their support from Eisner. This vote further fueled the bad publicity, and Eisner picked Robert Iger to be his successor. Fittingly, Iger headed Disney television, and, when he officially takes over as CEO on Oct. 1, he should continue Disney's transformation into a home-entertainment empire.

It's very sad to see Eisner go. That was sad news for Disney fans

ABlairican Pie · 10-01-2005, 01:33 AM

Quote:

Originally Posted by musicradio77

As of right now, Michael Eisner is leaving Disney for good.

I've been a Disney fan forever because of Eisner's departure from the company.

Something doesn't sound right about the second sentence.

SBTB Geek · 10-01-2005, 02:59 AM

Didn't Eisner screw over Disney?

Mr. Television · 10-01-2005, 03:42 AM

Quote:

Originally Posted by Captain ABlairica

Something doesn't sound right about the second sentence.

spunkygirl · 10-01-2005, 10:23 AM

Quote:

Originally Posted by SBTB Geek

Didn't Eisner screw over Disney?

So to speak

I know alot of people who will be glad he's leaving

Brian · 10-01-2005, 02:26 PM

Quote:

Originally Posted by Sasette

So to speak

I know alot of people who will be glad he's leaving

I'm one of them.

It's about dang time.

YoliUSA · 10-01-2005, 03:25 PM

I'm really glad that he is leaving. I've heard that he ruined Disney, and I believe it. Disney used to be soo much better years ago.

theshark8777 · 10-01-2005, 03:36 PM

Quote:

Originally Posted by Brian

I'm one of them.

It's about dang time.

Me too.

Brian Damage · 10-01-2005, 04:20 PM

Why all the hate for Eisner? What did he do wrong?

Mysty Eyes · 10-01-2005, 06:51 PM

Quote:

Originally Posted by Brian Damage

Why all the hate for Eisner? What did he do wrong?

Try this link, and the others listed in the article:
http://www.uncoveror.com/eisner.htm

I don't see Eisner's departure as sad, but rather somewhat overdue.

Better Days · 02-02-2006, 02:27 AM

Eisner was a problem for a few people.......but that ling to "uncoveror" is obviously fake. Eisner is too smart to talk like that, or to remove the "Disney" name.

Hollow · 02-02-2006, 03:44 AM

isn't he that idiot who makes occasional appearances on family guy? you know, in one episode he gives brian a bill for something and yells "NO GIVESIES BACKSIES!!11" and starts running away and trips on something after a few steps and falls down..or is it someone else with a similar name?

Janice Johnson · 02-02-2006, 01:11 PM

Isn't that good news? Didn't he run Disney into the ground?

Mr. Stefani · 02-02-2006, 01:14 PM

This is good news. He ran the parks into the ground. I think mostly everyone is glad to see him go.

Janice Johnson · 02-02-2006, 01:23 PM

Quote:

Originally Posted by TIM087

This is good news. He ran the parks into the ground. I think mostly everyone is glad to see him go.

10-01-2005, 01:14 AM	#1
musicradio77 Disney Expert Forum Veteran Join Date: Jul 14, 2003 Location: Brooklyn, NY USA Posts: 6,475	SAD NEWS: Michael Eisner Is Leaving Disney As of right now, Michael Eisner is leaving Disney for good. I've been a Disney fan forever because of Eisner's departure from the company. I want you to read this article from MSN's website: How Did Michael Eisner Make Disney Profitable? Not with cartoons. By Edward Jay Epstein Q. "How's your wife?" A. "Compared to what?" —Henny Youngman routine What is the proper measure of a Hollywood mogul? For entertainment reporters, it's often a mogul's personal behavior. The more incidents of arrogance and insensitivity they uncover, the more they assume that a mogul is an ineffective leader. During the contentious period surrounding Michael Eisner's announcement that he was resigning from Disney, a frenzy of items appeared, casting him as a villain worthy of one of his animated hits. It will be recalled that Eisner alienated a host of would-be moguls—including Jeffrey Katzenberg (whom he called a "midget"), Michael Ovitz (whom he called a "psychopath"), Roy Disney (whom he kicked off the board), and Harvey Weinstein (whom he forced out of Miramax). These men, by one means or another, yielded an El Dorado of gotcha items to the press. What was lost in this morality tale was the story of Eisner's transformation of Disney. He turned a faltering animation-and-amusement-park company into one of the world's most successful purveyors of home entertainment. He'll depart as Disney's CEO quietly on Friday, without a gold watch ceremony. The lack of fanfare seems to mark him as a man who failed and sullied the good name of Mickey. But if you look at Eisner's metrics—the numbers that Wall Street believes are unambiguous indicators of a company's performance—Disney boomed under Eisner. Eisner's Metrics, which are all public numbers: Category 1984 2004 Percent change Disney's Revenues $1.5 billion $30.8 billion +2,000 Disney's Income $294 million $4.49 billion +1,600 Disney's Tax-Free Cash Flow $100 million $2.9 billion +2,900 Stock Price (adjusted for splits) $1.33 $28.40 +2,100 Market Value $1.9 billion $57.4 billion +3,000 Disney's Enterprise Value (market value plus debt minus cash) $2.8 billion $69 billion +3,200 In 1984, when Eisner took command, the "Mouse House" produced only one animated picture every three to five years. Its entire film library had only 158 features, and its single cable channel, the Disney Channel, lost money. In addition, Disney had virtually no income from sales of videos. To keep afloat, the company depended on its amusement parks and its Mickey Mouse licensing. Yet even with these assets Disney had a tax-free cash flow of just $100 million. Its share price, reflecting this precarious financial position, was $1.33 (adjusted for splits). In 2005, Disney was one of the richest companies in America. Its enterprise value—Wall street's favored measure of an entertainment company—had increased 32-fold since 1984 and stood at $69 billion. Its tax-free cash flow had increased 29 times, to $2.9 billion. Its film library had grown to 900 features, which were licensed on TV and sold on video and DVD, and its home-entertainment division accounted for nearly one-third of the revenues of the entire industry. Its share price, reflecting this robust health, had risen to $28.25. Eisner's success becomes even more impressive when compared with his peers. Between 1984 and 2005, TimeWarner wrote off $99.7 billion; Vivendi-Universal, $40.6 billion; Viacom, $21.2 billion; News Corporation, $7.2 billion; and Sony, $2.7 billion. Among the six companies ("the sexopoly") that now dominate the TV industry, Disney alone did not write off any loss during this time. How did Eisner succeed in adding $65 billion in enterprise value to Disney at a time when his rivals were faltering? Having come from television, Eisner saw that Disney's future would be in home entertainment—not in movie theaters. Consider just two decisions he made that brought about this corporate transformation. The first came in the mid-'80s. At the time, Disney studio executives (including Katzenberg) were arguing that to release the company's beloved animated movies on video cassette would kill any profits to be made from re-releasing them in theaters. Eisner perceived the situation differently, and he put the videos into stores. Within a few years, video sales were providing almost all the profits for Disney's movie division and, by 2004, Disney raked in $6 billion from videos and DVDs sales. The second decision came in 1995, when Eisner bought his old alma mater, Capital Cities/ABC, for $19 billion. With this single coup, Disney got not only the ABC network and TV stations, it also got 80 percent of a sports network, ESPN. Since the cable operators needed this sports network to attract subscribers, Disney charged them a "carriage fee" just for the right to intercept its satellite signals. Disney was able to ratchet up this charge, which is effectively a tax on cable households, by 20 percent a year, getting as much as $2 a month for every subscriber signed up by cable operators. With the success of ESPN, Disney gained such enormous leverage over the entire cable industry that, in 2004, the company earned a record $1.94 billion in bottom-line operating income from its cable channels alone. To put this number in perspective, it was nearly triple the $662 million Disney earned from all its movie production and distribution, stage plays, records and music publishing, television library sales, videos, and even its booming DVDs (which accounted for about 80 percent of the $662 million). These numbers did not go unnoticed by the fund managers who controlled two-thirds of Disney shares. As it became increasingly clear that Eisner had hit the jackpot with ESPN, these fund managers focused more and more on Eisner's inability to convert the enormous appreciation of Disney's assets into a stock-market payoff. One way to bring about that payoff would be to install new management who were willing to sell assets—even ESPN. Although Disney's shares had increased by 10.6 percent since 2001—which was a better performance than most of Disney's rivals—that was not enough to satisfy investors. In March 2004, 43 percent of shareholders voted to withhold their support from Eisner. This vote further fueled the bad publicity, and Eisner picked Robert Iger to be his successor. Fittingly, Iger headed Disney television, and, when he officially takes over as CEO on Oct. 1, he should continue Disney's transformation into a home-entertainment empire. It's very sad to see Eisner go. That was sad news for Disney fans
	__________________ Musicradio77 Productions

10-01-2005, 03:25 PM	#7
YoliUSA Fan of the Classics Forum Veteran Join Date: Jun 13, 2002 Location: In a galaxy far, far away... Posts: 5,290	I'm really glad that he is leaving. I've heard that he ruined Disney, and I believe it. Disney used to be soo much better years ago.
	__________________ "All our dreams can come true, if we have the courage to pursue them". ~Walt Disney "Sometimes I just don't understand human behavior"- C-3PO My DVD's

10-01-2005, 04:20 PM	#9
Brian Damage I'm Rich Bitch Forum Icon Join Date: Feb 03, 2002 Location: What Ain't No Country I Ever Heard Of...They Speak English in What? Posts: 63,107	Why all the hate for Eisner? What did he do wrong?
	__________________ The Key to the Kingdom of Heaven: John 3:3 *Money Doesn't Buy Happiness...But I'd Rather Cry in My Private Jet*

02-02-2006, 02:27 AM	#11
Better Days Member Frequent Poster Join Date: Dec 05, 2005 Location: California Posts: 248	Eisner was a problem for a few people.......but that ling to "uncoveror" is obviously fake. Eisner is too smart to talk like that, or to remove the "Disney" name.
	__________________ CHANGE the world!! Ask not what Obama can do for you. We are responsible for the past and the future. Besides, the big 2 parties aren't working for us. PicKet FenceS on DVD! CLueLeSS "It's like old times" - Luke Spencer to Robert Scorpio! (General Hospital) Feb 21, 06

10-01-2005, 02:59 AM	#3
SBTB Geek Smooth Moderator Forum Veteran Join Date: Feb 21, 2002 Location: Southern California Posts: 6,004	Didn't Eisner screw over Disney?

02-02-2006, 03:44 AM	#12
Hollow Member Forum Superstar Join Date: Dec 16, 2001 Posts: 30,406	isn't he that idiot who makes occasional appearances on family guy? you know, in one episode he gives brian a bill for something and yells "NO GIVESIES BACKSIES!!11" and starts running away and trips on something after a few steps and falls down..or is it someone else with a similar name?

02-02-2006, 01:11 PM	#13
Janice Johnson Commercial Lover Forum 4000 Club Member Join Date: May 30, 2003 Location: Miami, Florida Posts: 4,740	Isn't that good news? Didn't he run Disney into the ground?

02-02-2006, 01:14 PM	#14
Mr. Stefani Member Forum Celebrity Join Date: Jul 15, 2001 Posts: 20,757	This is good news. He ran the parks into the ground. I think mostly everyone is glad to see him go.