Fool on the Street: Disney
At the 2006 Goldman Sachs
Communacopia conference last month, Disney
CEO Bob Iger showed up for an extended Q&A session with analysts. To give you the inside scoop on what these analysts know that individual investors don't, I listened in and wrote up my thoughts.
... The technology buzz
The launch of Disney movies on Apple
's iTunes service shows Disney's willingness to blaze a trail into the digital unknown. Apple CEO Steve Jobs' presence on the Disney board of directors likely played a role in that move, too. Iger calls Jobs "a tremendous sounding board," always ready with ideas on how Disney can ride technology into the future of entertainment. "I think we're lucky to have him," Iger says, and it's hard to disagree with that assessment; Jobs is one of the market's most exciting innovators and visionaries.
... What's in a brand name?
Speaking of the Disney brand, Iger spent some time discussing the value of its Big Three household names: Disney, ABC, and ESPN. At the heart of the matter, he said, is the need to create great content under these brands, and then leverage those assets in every way possible, including an expected relaunch of the online Disney.com site in early 2007. Leveraging could mean taking a hit movie like Pirates of the Caribbean
and turning it into a television show, computer games, retail shopping items, theme park rides (in a bit of cyclical irony), educational materials, music, and so on.
The upshot is that when Disney takes care to start from something great, the company subsequently requires less effort and money spent to market it across all these channels. The best advertising in the world is positive word of mouth. That's the idea behind giving the Pixar crew creative power within the Disney animation studio, and also the reason for scaling the film release schedule down to about ten live-action movies per year -- hopefully, ten really good
ones. These are the sparks that should start the fires of customer acceptance and brand loyalty.
... Doing the A-B-Cs
"We don't view ABC as just a broadcast television network today," Iger said. "We view it as a platform that side-by-side with other platforms will be used to essentially generate revenue to invest in great creative content, and then to move that content rather seamlessly across platforms, to reach as many people as possible and generate as much revenue as possible."
That's more of the content-first idea, seen from the other side of the issue. ABC will become a multi-platform outlet for Disney creativity, pulling in local and national television network resources alongside its online presence, and monetizing the content through all of these conduits.