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Bob Iger shocks media, names Disney’s linear TV channels likely headed for the chopping block

July 13, 2023 | | Print Article

Disney CEO Bob Iger sent shockwaves through the media Thursday by revealing that he’s interested in selling some of the company’s TV networks.

He made the remarks in a CNBC interview that aired a day after Disney extended his CEO contract by two years. Recall that he returned to the company in November after Disney ousted former CEO Bob Chapek.

“After coming back, I realized the company is facing a lot of challenges, some of them self-inflicted,” he said in Thursday’s interview.

At the top of his list, he said, is determining whether regular TV is a worthwhile investment. Specifically, he said channels like ABC, FX, National Geographic, and Freeform “may not be core to Disney.”

Listen:

The relevant part of the interview began with Iger talking about the “transformative” work he’s hoping to accomplish before he leaves in 2026.

“Transformative work is dealing with businesses that are no growth businesses and what to do about them, and particularly the linear business, which we are expansive in our thinking about. And we’re going to look expansively about opportunities there because clearly, it’s a business that is going to continue to struggle,” he said.

By linear, he meant regular TV.

“Linear TV is defined as the traditional form of TV, which is programmed and watched as scheduled through satellite or cable, and is not streamed to a specific user on demand. It generally caters to prime time viewing, which is when most people are in front of their screens,” according to the marketing platform Mntn.

Interviewer David Faber then cut in to ask whether he was talking specifically about networks like ABC and FX.

“Is it possible you would look to sell them?” he asked.

“We have to be open-minded and objective about the future of those businesses, yes,” Iger replied.

“Meaning that they’re not core to Disney?” Faber asked.

“That they may not be core to Disney,” Iger confirmed.

“The distribution model, the business model that forms the underpinning of that business and that has delivered great profits over the years is definitely broken. And we have to call it like it is,” he added.

As noted earlier, his remarks sent shockwaves through the industry:

That said, Iger went out of his way to note that he wasn’t talking about ESPN, which is also owned by Disney — and which, FYI, is just as “woke” as Disney.

He did say, however, that he’s interested in selling an equity stake in ESPN to a strategic partner.

“Disney has held early conversations with potential partners that could improve an ESPN streaming service by extending its distribution and adding content, Iger said. He declined to name specific partners. Disney currently owns 80% of ESPN. Hearst Communications owns the other 20%,” according to CNBC.

“Disney has held off from putting its prime ESPN content on its ESPN+ streaming service as it continues to make billions of dollars in revenue each year through traditional cable TV. Still, millions of Americans cancel their cable subscriptions each year, and that number has accelerated in recent years.”

During the same interview, Iger also slammed writers and actors — in addition to their unions — for striking.

“It’s very disturbing to me. We’ve talked about disruptive forces on this business and all the challenges we’re facing, the recovery from COVID which is ongoing, it’s not completely back. This is the worst time in the world to add to that disruption. I understand any labor organization’s desire to work on behalf of its members to get the most compensation and be compensated fairly based on the value that they deliver,” he said.

“We managed, as an industry, to negotiate a very good deal with the directors guild that reflects the value that the directors contribute to this great business. We wanted to do the same thing with the writers, and we’d like to do the same thing with the actors. There’s a level of expectation that they have, that is just not realistic. And they are adding to the set of the challenges that this business is already facing that is, quite frankly, very disruptive,” he added.

These particular remarks prompted a massive backlash from the left:

Vivek Saxena
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