Disney Debates the Outsiders
Last month, Disney unintentionally revealed its shortlist of potential CEO replacements for Bob Iger.
Now, a new report suggests the likeliest two candidates who don’t currently work for The Walt Disney Company.
One of these names is familiar to anyone who has paid attention to Disney’s palace intrigue. The other is…quite the shock.
Yes, Disney is debating a pair of outsiders as the company’s next CEO. Let’s talk about what we just learned.
The Obvious Choice
Bob Iger hasn’t done much wrong during his tenure as Disney CEO. Nobody earns the reputation of the greatest media CEO ever accidentally.
You must demonstrate sustained excellence for many years and make few mistakes.
Quick, what’s the worst thing Bob Iger did as CEO! I suspect all of you know this one. It’s inarguably Iger’s selection of Bob Chapek as his replacement.
While some would argue that Iger dealt Chapek a losing hand which the pandemic made worse, the reality is that Disney suffered under Iger’s replacement.
The problem grew so dramatic that under cover of darkness, Disney fired Chapek while he was waiting to appear live at a Disney+ event. It was brutal.
Iger’s return signified a return to happier times for Disney fans. However, the executive has indicated that he’s not in it for the long haul.
Presuming that we believe him, Iger possesses the rare opportunity to right a wrong.
In December 2019, I wrote this article based on what I was hearing from within Disney.
The gist was that Iger recognized the shortcomings of his lieutenant, Chapek, and decided that another Disney executive made more sense as CEO.
That person was Kevin Mayer, who had spearheaded the creation of Disney’s three-headed streaming strategy, the so-called Disney Bundle.
Before that, Mayer had proved integral in the purchases of Marvel, Lucasfilm, and BAMTech.
In short, many of Iger’s greatest successes were also Mayer’s. As I mentioned in a discussion of Iger’s autobiography, he mentioned Mayer 12 times.
Chapek only came up anecdotally as a special thanks and in reference to a tragedy they experienced together.
Kevin Mayer was Bob Iger’s favored candidate, and it’s always been odd that the current Candle Media executive didn’t get the job.
Now, Iger could fix that wrong by naming Mayer CEO.
The Other Named Candidates
Last month, I suggested that four people had risen to the top of the list as potential successors to Bob Iger.
Those individuals are (in order of last month’s power rankings): Parks Chairman Josh D’Amaro, Co-Chairmen of Disney Entertainment Dana Walden and Alan Bergman, and ESPN Chairman Jimmy Pitaro.
While I don’t want to read too much into a single report, Dana Walden is the only current Disney executive mentioned by Fox Business and other corresponding reports.
D’Amaro, whom I’d previously listed as the favorite, comes across as an also-ran here, as do Bergman and Pitaro.
Notably, we shouldn’t dismiss them as candidates. The unnamed sources work within Disney, making them more likely to be inside the loop.
So, I’m not ruling out any of Bergman, D’Amaro, or Pitaro as a candidate. I do think it’s interesting that only Walden merits special mention, though.
According to a Fox Business report on Friday, March 3rd, Disney has created an internal shortlist for Iger’s successor.
Walden represents the only current Disney employee on this shortlist.
Mayer, a former Disney executive, doesn’t count since he’s been away from Disney for three years.
Meanwhile, Disney CFO Christine McCarthy doesn’t even get a mention here, which will prove important in the next section.
When some outlets reported that McCarthy had taken the pole position as Iger’s successor, I flat-out said that I suspected someone in her camp was the source.
The same logic applies to the other candidate we should discuss…
The Shocking Name
Adam Silver currently works as the Commissioner of the National Basketball Association.
He’s the hand-picked successor of David Stern, quite possibly the greatest sports commissioner ever.
Stern got right what Iger got wrong. The late, great Stern mentored Silver and prepared him to take on the role of the head of the NBA.
Then, Stern walked away on top, leaving Silver well-positioned to excel, which he has.
In fact, the person most likely to hold an argument as a superior sports commissioner to David Stern is his protégé, Adam Silver.
The NBA has set records for television licensing rights in recent years, partially thanks to Disney’s ESPN.
Soon, the NBA will sell long-term rights again, as the current agreements with Warner Bros. Discovery and Disney end after the 2024-2025 season.
Meanwhile, Adam Silver’s contract as commissioner runs through 2024. Feasibly, the rights could expire under the tenure of a new commissioner.
That’s the supposition if Silver does the unthinkable and becomes CEO at Disney.
According to Fox Business, Silver’s name is among the three people on the shortlist alongside Walden and Mayer.
How weird is that? Well, I won’t undersell it. Silver’s primary work experience comes from work as a lawyer, followed by his NBA tenure.
Silver has never helmed a Wall Street corporation per se, although we’re splitting hairs. No, the NBA doesn’t trade as a stock or anything, but it’s a business.
In 2013, the last year that David Stern ran the NBA, the average team franchise held a valuation of $509 million.
For 2022, that number had more than quintupled to $2.86 billion.
You could argue that Silver has succeeded while standing on Stern’s shoulders. Then again, Chapek couldn’t do that.
Evaluating the Outsiders
We’re in 2023, which means Silver’s NBA contract expires next year. This is a time when negotiations ensue for a contract extension.
NBA owners face a problem here, as Silver makes “only” $10 million. While that may seem like a lot to most people, Silver is only the third-highest-paid sports commissioner.
The NFL’s commissioner, Roger Goodell, earns more than $60 million annually, while MLB commissioner Rob Manfred makes $17.5 million.
On the best day of Rob Manfred’s life, he possesses a fraction of Adam Silver’s skill as an executive…but he is paid 75 percent more.
In short, Adam Silver can rightfully claim that he is underpaid relative to the NBA’s success under his tenure.
Meanwhile, NBA owners have operated under the assumption that he didn’t want to leave. So, they had little incentive to offer him a pay increase.
So, I believe this situation is akin to the prior instance with Christine McCarthy wherein the most likely source for this is Adam Silver or someone within his camp.
“I could leave to become Disney CEO” provides an exceptional bargaining chip at the negotiating table.
Still, Silver possesses some unique Disney history. He was the person who pushed the idea of the NBA Bubble at Walt Disney World, which saved the 2020 season.
During his time there, Silver could have impressed Disney executives with his instincts and leadership. He’s a smart man, and I’d definitely trust him to lead my company.
Still, I believe strongly in institutional knowledge, and I think Iger does as well.
If Disney does select an outsider as Iger’s CEO successor, I’ve said all along that I believe Kevin Mayer’s the choice.
This move allows Iger to right a previous wrong. Silver’s a fun name, but I believe he and Iger have mutually agreed to this leak.
The news allows Iger to demonstrate he’s considering outside-the-box candidates who are supremely qualified.
Meanwhile, Silver can use this as leverage for a better contract extension.
Later, the strong working relationship between Iger and Silver could lead to a better ESPN agreement for NBA rights beyond the 2024-2025 season.
Perhaps the most intriguing element of this shortlist is that Walden is on it, while D’Amaro isn’t. How much should we read into that?
I honestly don’t know, but right now, I’m more convinced than ever that the three frontrunners for Disney’s next CEO are Walden, Mayer, and D’Amaro.
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Feature Photo: Disney