IN “RATATOUILLE”, the most recent animated film from Pixar, a film studio owned by Disney, a talented cook named Remy, who happens to be a rat, finds his way into the kitchen of a once-great restaurant. Its head chef has given up on creativity and instead plans to churn out ready meals branded with the name of the restaurant's revered founder, Auguste Gusteau. Eventually the chef loses control of the restaurant, the frozen meals are tossed out and Remy's cooking helps it regain its reputation and inventive flair.
Something similar appears to have happened at Disney. Four years ago it was in turmoil, with its then chief executive, Michael Eisner, under siege from shareholders who accused him of stifling the firm's creative culture. Today under Bob Iger, who took over as chief executive in 2005, Disney is enjoying a remarkable and profitable run of hit TV programmes and films. “Disney's creative momentum is so strong now that there's no comparison between it and other big media companies,” says Lawrence Haverty, a fund manager at Gabelli Asset Management.
In the past Disney concentrated mainly on the very young, but in recent years it has found a new audience among “tweens”, or nine- to 14-year-olds. In 2006 the Disney Channel in America started showing “Hannah Montana”, a TV series about an ordinary girl with a double life as a rock star, and broadcast “High School Musical”, a television film about a romance between two pupils from different cliques at school. Both turned into huge hits with staying power: in fiscal 2006 and 2007 combined, Disney made over $100m of operating profit from “High School Musical” and various spin-off products. Coming soon is “Camp Rock” a Disney Channel film starring the Jonas Brothers, a wholesome boy-band which has already sold over a million CDs for Hollywood Records, Disney's recorded-music label.
At the same time Disney's broadcast-TV network, ABC, is benefiting from a number of hits, such as “Desperate Housewives”, “Lost” and “Ugly Betty”. Disney has also improved the fortunes of its film business, which earned $1.2 billion in operating profit last year, up from $200m in 2005. Some of the increase came from the firm's acquisition of Pixar for $7.4 billion in 2006, but the performance of Disney's live-action films, such as “Enchanted”, drove most of the improvement. On April 8th Disney laid out ambitious plans for ten new animated films in the next four years.
What accounts for this renaissance? Mr Iger's management style is said by many to have unlocked Disney's creativity. “There was already creativity inside Disney, but Bob removed the barriers to it,” says Peter Chernin, chief operating officer of News Corporation, a rival media group. “Michael Eisner was all about his own creativity,” says Stanley Gold, a former Disney board director who led a campaign to oust Mr Eisner in 2004, referring to the way in which the former boss meddled in the detail of Disney's parks and movies. In contrast, he says, “Bob pushes creative decisions to the people below him.”
In addition, Mr Iger's acquisition of Pixar, a studio that insists on creative originality, has sent a signal to people inside and outside Disney. “A few years ago we weren't necessarily seen by the creative community as the place to be,” says Tom Staggs, Disney's chief financial officer, “but now that has changed and people want to work here.” Mr Iger immediately put Pixar's top people in charge of Disney's animation business, and last year he put an end to the practice of making cheap direct-to-video sequels of old favourites, such as “Cinderella II: Dreams Come True”—Disney's equivalent of frozen food.