When You Wish Upon Two (Web) Stars: CEO Bob Iger Talks About the Next Digital Direction for Disney
[On weekends, we will be re-posting some pieces from the previous week that we wanted to call attention to again that some readers might have missed.]
After Disney named two longtime Internet execs–Playdom’s John Pleasants and Jimmy Pitaro of Yahoo–as co-presidents of its Internet unit, BoomTown did a longer interview with CEO Bob Iger about the entertainment giant’s next Web moves.
I always enjoy talking digital with Iger–who is pictured above in an interview I did with him in 2006 at the fourth D: All Things Digital conference–since he has been one of the old media moguls who seems unafraid of the challenges of new media.
While appropriately wary, Iger acted early and often in exploring digital initiatives at Disney (DIS) that others in Hollywood’s and New York’s media worlds were loath to consider.
“I have tried to keep two obvious philosophies,” Iger said in a phone interview yesterday. “First, that our current business not get in the way of adopting new technologies, and, second, that our business belongs on these new platforms.”
Easy to say, of course, but it’s still nice to hear, given the longtime, incessant and ultimately wearying push-and-pull between those who make bucks making content and those who make bucks making technology.
“My premise is that technology is about an opportunity for us,” said Iger. “And we cannot will it away and should not…because you can’t stop these things from happening.”
That’s presumably the impetus behind the hiring of Pleasants and Pitaro (picture here, left to right).
With an assist by recent Disney board member and Facebook COO Sheryl Sandberg, Pitaro came to his attention earlier this year, Iger said.
Pitaro left his job as SVP of Media at Yahoo (YHOO) last week.
And Pleasants was CEO of Playdom, the online social gaming company that Disney acquired for $763 million in late July.
The pair, who will report directly to Iger as co-chiefs of the Disney Interactive Media Group, replace outgoing head Steve Wadsworth.
The shift is a big move by the entertainment giant and yet another attempt to clarify and bolster its Web strategy, which has had a long and often rocky history.
Under the previous regime of former CEO Michael Eisner, for example, Disney bought search engine Infoseek and tried to create a portal called Go.com.
That failed, and was one of many efforts to define the media company’s Web goals.
More recently, in 2008, Disney gathered most of its Internet properties within DIMG under Wadsworth.
Still, money-making has not been part of the mix. In its most recent quarter, DIMG lost $65 million on revenue of $197 million.
In the interview about the new structure, Iger said: “I think we’ve built a framework of assets, and now is the time to create a structure in a more focused way. In splitting the divisions, we can focus more on them better and in a way they deserve.”
He outlined the new set-up, which will have Pleasants focus on the online gaming and mobile landscape and Pitaro on the Web arena.
Iger said he felt Pleasants and Pitaro brought different backgrounds to the task, as well as longtime experience in the Internet arena.
He said that upon considering a fresh approach, he felt that Wadsworth was “spread too thin,” given all the various online arenas for Disney.
In fact, today, Disney owns a number of big Internet properties, including Disney.com, Family.com and Club Penguin, although there does not seem to be a particularly cohesive strategy among them.
Of course, that’s no surprise, given it is all part of a multifaceted media company with a variety of businesses.
Due to its powerful content assets, said Iger, it might be a perfect time for a more cogent plan. With the explosion of devices, such as the Apple (AAPL) iPad and others, the importance of cooperation between content and technology is more critical than ever.
“I think a lot of technology companies are really finally ready to handle more premium content in a way that is beneficial to all of us,” said Iger.
And, he added, it was time for Disney to get more involved in technology, which was the reason for the purchase of Playdom. The move has made it more a publisher than a licensor.
“If we wanted to get significant in size, we need the investment to be greater,” Iger said about the big payout to get into the fast-growing social gaming arena.
And that has meant less emphasis on console games, on which he said Disney had focused too much in the past.
No longer–now Iger said he has planted Playdom, as well as its purchase of the Tapulous music app start-up, in a spanking new facility in Palo Alto, Calif., right in the heart of Silicon Valley.
“We need to be part of the culture and world there in a significant way,” said Iger. “And I believe I have convinced the senior team within Disney that Playdom is a huge opportunity for them.”
That includes online gaming related to units such as sports at ESPN, as well as other Disney brands, such as the theme parks or Marvel, into Playdom games.
While Pleasants will run his part of the show from Silicon Valley, Iger said, Pitaro will work out of Los Angeles on Web initiatives and in upgrading the Disney online experience.
“We want to make Disney sites more of a community and entertainment center than a marketing hub,” said Iger. “Where is gets complicated is the levels of exclusivity and the other places we want to distribute our content.”
That includes being part of the premium Hulu online video site, as well as perhaps even creating a Disney-branded pay service, but also being open to working more with Netflix (NFLX).
And that means a multifaceted approach to all kinds of payment models for Disney online, from subscription to advertising-supported to pay-per-view.
“In certain areas, we will be very aggressive with our content and in others less aggressive, to the extent that each offers us revenues,” said Iger. “Obviously, where there is potential cannibalization, we will be a little more careful…but we are going to push forward.”
When asked about the most obvious management issue–the possibility of clashing with two heads of one division (MySpace, anyone?), Iger said that while there was overlap, he thought the jobs Pitaro and Pleasants had to do were also wide-ranging and different enough.
Plus, added Iger, “They both report directly to me and I am there to see to it that it works.”
In other words, as Disney continues to move forward into the digital future, the content and technology buck stops, as it should, at Iger.