The Walt Disney Co.’s board named director James Gorman as chairman of its succession planning committee.

Succession has been a big issue for Disney. Replacing CEO Michael Eisner was messy before Bob Iger got the job in 2005. Iger’s replacement, Bob Chapek, was a washout, prompting Iger to return to the job in 2022.

When Iger, now 73, returned, he and the board said finding the company’s next CEO would be a priority.

Gorman, who joined the board this year, oversaw the process that found his own successor as CEO at Morgan Stanley, where he continues to serve as executive chairman.

“James is a highly respected leader, and we’ve asked him to serve as the new Chair of the Succession Planning Committee given his deep succession planning experience and long-term strategic mentality,” said Disney board chairman Mark Parker, who had served as the head of the succession committee.

“Succession planning is a top priority of the board, and I am eager to continue collaborating with James on the committee as we advance the important work we have already been doing to identify and prepare the next CEO of The Walt Disney Company,” Parker said.

In addition to Gorman and Parker, Disney directors Mary Barra and Calvin McDonald will continue to serve on the succession committee.

The board has said it is reviewing internal and external candidates for the CEO post. Internal candidates are going through a preparation process that includes mentorship from Iger, external coaching, and engagement with all board directors.

The Walt Disney Co.’s board of directors elected Susan Arnold as chair of the board, effective Dec. 31, when she will succeed former CEO Bob Iger as chairman.

Arnold has been a director of Disney for 14 years and independent lead director since 2018.

She was an operating executive of The Carlyle Group from 2012 to 2021. Before that, she was president, global business units, at Procter & Gamble.

“Susan is an incredibly esteemed executive whose wealth of experience, unwavering integrity, and expert judgment have been invaluable to the company since she first joined the Board in 2007,” said Iger, currently executive chairman as well as chairman of the board. “Having most recently served as independent lead director, Susan is the perfect choice for chairman of the board, and I am confident the Company is well-positioned for continued success under her guidance and leadership. It has been a distinct honor to work with Susan and our many other talented directors, and I am incredibly grateful for the support and wise counsel they have provided during my tenure.”

Iger has been chairman since 2012. He stepped down as CEO in 2020 and was replaced by Bob Chapek.

Also: Bob Iger Sells Off Half of His Disney Stock Holdings

"On behalf of the Board, I would like to express my deepest gratitude to Bob Iger for his extraordinary leadership over the past decade-and-a-half,” Arnold said. 

“Bob has led Disney to amazing heights both creatively and financially, with his clear strategic vision for delivering high-quality branded storytelling, embracing cutting-edge technology, and expanding internationally, and he’s left an indelible mark on The Walt Disney Company that will be felt for generations to come," she said. "As I step into this new role as Chairman of the Board, I look forward to continuing to serve the long-term interests of Disney’s shareholders and working closely with CEO Bob Chapek as he builds upon the Company’s century-long legacy of creative excellence and innovation.” ■

The Walt Disney Co. said pay for its top executives dropped in 2020 as incentive plan compensation dropped to zero in a year when its theme parks closed, its films couldn’t play in theaters and thousands of employees lost their jobs.

Bob Iger, who gave up the CEO title in February and remains executive chairman, received total compensation of $21.03 million in 2020, compared to $47.52 million in 2019. Iger’s salary fell to $1.569 million from $3 million. Last year he got $21.75 million in non-equity incentive plan compensation.

In its SEC filing, the company said that while executives performed admirably amid the challenges presented by the COVID-19 pandemic, “management and the Compensation Committee believe that in light of circumstances this year, that no bonus should be made” to its named executive officers.

Bob Capek, who followed Iger as CEO, got total compensation of $14.163 million, including a salary of $1.81 million.

CFO Christine McCarthy’s total compensation dropped to $10.997 million from $14.974 million in 2019.

Zenia Mucha, senior executive VP and chief communications officer, received $4.946 million, down from $7.562 million.

Chief Human Resources Officer and senior executive VP M. Jayne Parker’s compensation was 7.292 million, down from $9.021 million.

Rich Greenfield, the analyst who is outspoken in his belief that streaming will demolish the traditional TV business, said he was wrong about his recommendation to sell stock in the Walt Disney Co.

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In a post entitled “Upgrading Disney to Neutral: We were Wrong,” Greenfield and his colleagues at Lightshed partners, said he under-appreciated how quickly business would return to “normal” despite the continuing COVID pandemic and underestimated how completely Disney management would throw itself into its pivot to streaming.

“While we cannot fix our mistake, we believe investors will find it valuable for us to analyze why our call went off the rails, particularly in the past couple of months,” he said.

Read Also: Rich Greenfield Urges Investors to Sell 'Money-Losing' FuboTV

In particular, Greenfield said they were surprised that new Disney CEO Bob Chapek has gone all-in on streaming. They were “blown away” that Disney plans to increase content spending to more than $8 billion by 2024.

“Honestly, we felt Disney had given the CEO job to the wrong person,” Greenfield said. Instead Chapek has "impressed us” by leaning hard into the streaming playbook.

Read Also: Analyst Rich Greenfield Launches LightShed Partners

Greenfield also said that Disney has been managing its business to get the most possible subscribers and not prioritizing average revenue per unit or other shorter-term financial metrics. The company is also moving toward unifying its streaming products, putting ESPN into Hulu and pushing the Disney Plus-ESPN Plus-Hulu bundle.

Finally, Greenfield and Co. were surprised that the market no longer cares about the performance of ESPN and Disney’s other traditional TV properties.

“We believed Disney was moving slowly in streaming to sustain the health of those legacy TV assets,” they said. “While virtually every investor we talk to would like to see Disney spin-off its legacy broadcast/cable network assets, especially ESPN as we have suggested, they believe any value from a direct-to-consumer sports streaming business is a net positive compared to the legacy business simply evaporating over the next five to six years.”

Disney stock was down 0.69% to $177.35 in mid-day trading Friday.

When The Walt Disney Co. acquired 21 Century Fox, there were questions about how a grown-up brand like FX would fit in with Mickey, Luke, Buzz and Captain America.

At a time when attention is shifting from cable networks to streaming networks, the FX brand has found a home with Disney’s Hulu, and FX chairman John Landgraf seems to think that a good thing.

Also Read: Cable/Streaming Hybrid FX on Hulu Premieres

During Disney's investor day focusing on its direct-to-consumer strategy, Landgraf, who coined the term “Peak TV” to describe the abundance of content available to viewers, talked about how FX was adjusting to the new media world.

Landgraf said that over 20 years, the FX brand has moved from being a location on a cable channel guide to a destination for exceptionally compelling original stories and characters through a string of shows like The Shield, Nip/Tuck, Sons of Anarchy, American Horror Story, The Americans and Better Things.

Also Read: Landgraf on Getting FX Shows Over Finish Line During Pandemic

Those shows have generated remarkably high scores with critics and viewers. Landgraf said that FX shows averaged a seven and a half among IMDb users, while 74% of FX shows did 80% or better on Rotten Tomatoes. FX shows average 86% on Rotten Tomatoes, he said.

But these days, “linear channels are just not the optimal location for a couple of thousand great episodes of television,” Landgraf said. “And that fact caused many FX original series to be licensed and scattered across numerous other platforms, sometimes resulting in confusion as to which brand was actually responsible for fostering these beloved shows,” he said.

“But along came Disney, which acquired both the FX and a majority stake in Hulu and then enhanced the growth of FX as a brand by creating an FX-branded presence on Hulu, which has now become the singular U.S. streaming location at which the past, present and future of FX’s great shows could be gathered," he said.

Landgraf skipped a bit of history. FX bought the rights to nearly all of its shows and launched a subscription service FX Plus in 2017. It was shut down in 2019 after FX was acquired by Disney so that the shows could be available through Hulu.

Being part of Hulu has helped FX’s shows. “The average audience of FX scripted series launched on Hulu has increased 120% over their audience on our channels and VOD site alone--120%. And with the expansion of distribution that Hulu provides, every single one of FX’s returning series has posted year-over-year viewership increases,” Landgraf said. 

Also Read: 'Fargo' Finally Set to Premiere? You Betcha!

FX has also begun creating original FX series that appear exclusively on Hulu.

“So the addition of the FX brand has significantly expanded the audience reach for FX and added to the outstanding results Hulu has already been achieving with their own excellent original programming but the best is still to come,” Landgraf said. Because of production delays due to COVID-19 the full benefit of FX's hit current programming has yet to be realized. However, most [00:15:59] of our shows are back up and running and we expect to begin rolling out shows again early next year.”

Also Read: 'It's Always Sunny in Philadelphia' Gets Four-Season Renewal

Among the shows coming back is It’s Always Sunny in Philadelphia, which was renewed for four more year, making it the longest running live-action sitcom in television history, surpassing Ozzie & Harriet.

FX will be making more shows now that it’s aligned with Disney and Hulu, Landgraf said. 

“The FX brand will quickly be able to double our output making and marketing about 30 original programs each year,” he said. “While I know that doesn't sound like a huge number in the air of peak TV, I assure you that these 30 shows will punch vastly above their numerical weight just as FX originals always have because we will strive as always to ensure that every single one of them will be excellent,”

Among the series on the way is a series based on the Alien films that will be set on Earth. Another is a two-season series that will trace the rise of the Rolling Stones as the World’s Greatest Rock and Roll Band from the early 60s to 1972. The Stones are participating in making the show. FX is also working on a remake of Shogun.

Landgraf told analysts that making all those shows would prove to be a good investment. 

“Today's new programming is tomorrow's perpetual library, because of this FX and all of Disney's many brands can create incredible long-term value for fans and shareholders because we know that streaming subscribers will now be able easily and conveniently find, treasure and share their favorite series and characters,” he said. 

Ravi Ahuja, CFO and president of business operations for Disney’s TV operations, said he plans to leave the company following a restructuring of the business that separated the creative operations from business and distribution.

Ahuja, who came to Disney when it acquired 20th Century Fox, will stay on as a consultant until a new head of operations and finance is named for the new Disney General Entertainment unit, which is headed by Peter Rice.

“With the reorganization of our business and our pivot to wholly focus on the creation of programming while operations of the networks and management of the P&L moved to [the Disney Media and Entertainment Distribution group]. Ravi’s role as president of Business Operations and CFO significantly changed,” Rice said in an email to staff. “As much as I hoped he’d stay on, ultimately he decided to take this change as an opportunity to find a new challenge, and I understand and respect his decision.”

Rice noted that at Fox, Ahuja “was a terrific partner to me in operating our domestic and international sports and entertainment businesses across broadcast, cable, direct-to-consumer and the studios. Ravi played an integral role in the acquisition of the Yankees Network and our positions in Roku, Draft Kings, Aftershock Studios and National Geographic including the setting up of the joint venture.”

The Disney Media and Entertainment Distribution group is headed by Kareem Daniel and oversees Disney’s TV networks and streaming services, including operations and ad sales.

“I am leaving the company to pursue other challenges,” Ahuja said in his own email. 

“I have not come to this decision easily. I am very excited about the future of The Walt Disney Company and Disney General Entertainment. This is an amazing company, and ours is a tremendous team. There are very bright days ahead,” Ahuja said.

“Though the impetus for my decision has been the change in my role, I want to relay the pride I feel for helping to put together the group here and what we have accomplished since the Fox deal closed in March of 2019. We have seamlessly melded two big TV companies – Disney|ABC Television and Fox Networks. We have made incredibly popular and culture-defining television. We have a leadership team that works supportively with each other and in the best interests of our company and viewers. We are navigating through a once-in-a-century pandemic, and we are repositioning ourselves for the future of our company and our industry,” he said.

With streaming competitors still wondering how they’re going to compete with a robust Disney+ platform debuting with a low, low $6.99 price, The Walt Disney Company has announced a pricing strategy sure to spur even more antacid use in executives suites spanning from Los Gatos to Cupertino and Burbank.

Disney has announced that it will bundle Disney+, ESPN+ and the base, ad-supported tier of Hulu for $12.99, starting November 12 with the launch of Disney+.

Netflix’s most popular tier, which allows HD streaming and two simultaneous streams, retails at $12.99 a month. AT&T’s upcoming HBO Max, meanwhile, will be priced at around $17 a month.

At $12.99 a month, the Disney bundle offering represents a 27% discount over the $17.97 users would pay if they ordered each of the services individually. Disney+ is priced at $6.99 a month, with ESPN+ going for $5.99 and base-tier Hulu priced at $4.99.

Never mind that ESPN+ will, over time, as major league sports broadcast licensing deals get renegotiated, will have an incumbents inside track to such huge live franchises as the NFL, NBA, Major League Baseball and NCAA Football, just to name a few of ESPN’s current rights deals that will eventually transition to retail.

And never mind that Hulu represents a fairly significant SVOD smorgasbord.

Just listen to Disney CEO Bob Iger’s description of the Disney+ offering during Tuesday’s second-quarter earnings call:

“Disney+ will offer more than 600 hours of premium content from National Geographic at launch, along with almost 300 hours of family entertainment from the Fox Studios library,” Iger told investors. “Disney+ will ultimately become the exclusive streaming service for our vast library of movies and series, National Geographic content, all upcoming Disney, Pixar, Marvel and Star Wars movies and a robust slate of high-quality original programming from the creative engines that drive our entire company.”

National Geographic Global Networks president Courteney Monroe has signed a new contract to continue in her post as the network becomes part of The Walt Disney Co.

Monroe will continue to report to Gary Knell, chairman of National Geographic Partners.

She will continue to oversee global programming, operations and marketing for the National Geographic channels around the world and oversee NG Studios.

“We’re very excited to build on Courteney’s successful strategy, which has resulted in year-over-year growth, generated unprecedented critical acclaim and significantly raised the profile of National Geographic,” said Knell. “I have no doubt that Courteney will continue to drive growth and success for our brand around the world.”

At National Geographic Channels, Geoff Daniels was named executive VP, global unscripted entertainment, He’d been doing the job on an interim basis. Also Carolyn Bernstein becomes executive VP, global scripted content and documentary films.

Daniels and Bernstein both report to Monroe.

Cisco Systems said it will work with The Walt Disney Studios on the StudioLAB, an initiative focused on developing new technologies, designs and prototypes focused on video production.

The 3,500 square-foot StudioLAB facility will be based on the Disney studio lot in Burbank and lean on a mix of Cisco hardware and software products in areas such as storage, network, orchestration and collaboration.

Some areas of focus will include enhanced remote collaboration for creatives and studio leadership, more seamless and secure connections for filmmakers, the studio and third parties, and more efficient and reliable ways to deliver production data and assets from the set to the cloud, they said.

The Walt Disney Studios produces films for units that include Walt Disney Animation Studios, Pixar Animation Studios, Marvel Studios and Lucasfilm, and brings music and stage plays to consumers through The Disney Music Group and Disney Theatrical Group.

Cisco said it’s on board as a founding member and “Innovation Partner” of Disney’s StudioLAB, announcing the partnership during its first XR On the Bay Conference, hosted by Cisco’s Advanced Imaging Society at the company’s corporate campus in San Jose.

In March, Accenture announced it was selected as Innovation Partner for the StudioLAB project.

“We are very pleased to welcome Cisco as a StudioLAB Innovation Partner, as we combine the best of Silicon Valley and Hollywood to help our storytellers tell their very best stories. Through this partnership, we can push the boundaries of how content can be created and consumed,” Benjamin Havey, VP, technology innovation group, at The Walt Disney Studios, said in a statement.

“This partnership is a game changer for the media industry, and we are excited for the opportunity to work closely with The Walt Disney Studios team to prototype, develop and showcase new technology at StudioLAB,” added David Ward, SVP, CTO and chief architect at Cisco. “This will be the place where true innovation comes alive in media entertainment.” 

Netflix shares are down more than 3% Wednesday morning in the wake of news that The Walt Disney Company will stop distributing new release movies to Netflix in 2019 as it prepares to launch new direct-to-consumer OTT offerings, but concerns about the effect that decision will have on Netflix’s ability to gain and retain subscribers is overblown, an industry analyst says.

“There is no dispute, Disney and Pixar movies are fantastic collections of entertainment content. The Netflix service, or any service, is better off having them (at the right price),” Todd Juenger, analyst with Bernstein Research, said in a research note issued Wednesday. “However, there is evidence from Starz that losing Disney movie output doesn't necessarily have any visible impact on subscriber growth, as long as the entirety of the service is a good value proposition to consumers.”

RELATED: Disney Set to Launch Direct to Consumer Services

Juenger recalls that Starz lost rights to Disney movie output beginning in 2016 as Netflix acquired them in a three-year deal that expires at the start of 2019.

“Since then, there has been no discernable impact on Starz subscriber acquisition, churn, or net paid subs,” Juenger added. “If losing Disney movie output hasn't impacted Starz, then it shouldn't impact Netflix.”

Related: Disney's Streaming Move Creates New Questions for Distributors

He also points out that the change in Netflix’s rights structure with Netflix only affects the OTT provider in the U.S. (Netflix doesn’t have international rights to Disney movies, save for some countries where it has independent one-off deals), and that most of Netflix’s growth is now coming way of its international expansion. In fact, Netflix’s international subscriber base has surpassed its U.S. base following a strong Q2.  

Juenger said Netflix has about two years to plan for the change, adding that there’s no current impact on Netflix’s rights to Disney’s TV content, including Marvel-branded series.

“The idea that Disney wouldn't be willing to engage with and create/license content for Netflix over time, we think, is a very low (essentially zero) probability,” the analyst wrote.

The Walt Disney Co. said it plans to begin launching Disney and ESPN branded direct to consumer products.

Disney said it acquired a majority ownership in BAMTech LLC to serve as the technology backbone for the new products.

RELATED: Disney Buys One-Third of BAMTech for $1 Billion

The announcements came as the company announced lower profits in its third quarter.

RELATED: Michael Paull Named CEO of BAMTech

Disney said it will pay $1.58 billion to acquire an additional 42% stake in BAMTech, the technology services and video streaming spin-off of MLB Advanced Media (MLBAM).

RELATED: BAMTech CTO: OTT Providers 'Have to Produce Every Day'

The first direct to consumer products will be an ESPN-Branded multi-sport video streaming service that will launch in early 2018. It will be followed by a Disney braded streaming service in 2019.

Read more at B&C.