Global Entertainment Business Strategy

John Byrne, Executive Editor of BusinessWeek, interviewed the CEO of The Walt Disney Company, Robert A. Iger to gain his insight on the changing world of entertainment. In the interview they discuss the changes Disney had to make to keep up and stay on top of the highly competitive entertainment industry. After Iger was appointed CEO, he quickly took action to ensure Disney kept up to date with the ever changing entertainment industry.

Robert Iger is the sixth CEO in the Walt Disney Company’s 83-year history and was appointed on October 1, 2005. Before becoming CEO, Iger served as President and Chief Operating Officer since June 2000. In this role, he oversaw all aspects of the company's worldwide operations including its filmed entertainment, theme parks and resorts, media networks and consumer products. Mr. Iger also became a member of Disney's board of directors at this time. (Disney.com, 2009).

Mr. Iger began his career at ABC in 1974, and over the next 32 years he held a series of increasingly responsible senior management positions at the company. As President and Chief Operating Officer of Capital Cities/ABC he guided the complex merger of ABC with The Walt Disney Company. ABC saw tremendous growth during Iger's career there, becoming a market leader in broadcast television and expanding into numerous cable and related ventures. During Mr. Iger's years with ABC, he oversaw its broadcast television network and stations, radio, publishing and cable television businesses, which include the market leading brands of ABC, ESPN, Lifetime, A&E and The History Channel. He officially joined the Disney senior management team in 1996 as Chairman of the Disney- owned ABC Group and in 1999, was given the additional responsibility of President, Walt Disney International. (Disney.com, 2009)

When Iger was appointed CEO at Disney internal management called it a rouse and a fix, which nearly brought the company to a corporate equivalent of a floor fight. Many experts believe the same, but in the first two years Iger increased Disney’s market value by 15 billon dollars, making the company a more creative enterprise. Robert Iger is known for unchaining Disney with his calm and low-key management style and moving the company back to its roots as a creative, imaginary and innovative powerhouse of the entertainment industry. Soon after become CEO Iger approved the selling of ABC episodes on Apples iTunes, which changed Disney’s view on new digital distribution. A short time later he bought Pixar Animation Studios for 7.4 billion dollars, and introduced the marketing campaign “The Magic is Back at Disney.”

While Robert Iger did not agree, some people said that Disney paid too much for Pixar; he viewed it as an investment in the future and a way to bring talent back to Disney, just as Walt Disney would have wanted. Pixar Animation Studios is an Academy Award ®-winning computer animation studio with the technical, creative and production capabilities to create a new generation of animated feature films, merchandise and other related products. Pixar's objective is to combine proprietary technology and world-class creative talent to develop computer-animated feature films with memorable characters and heartwarming stories that appeal to audiences of all ages. (Pixar.com, 2009) Since the release of Snow White and the Seven Dwarfs by Disney in 1937, animated films have become one of the most universally enjoyed forms of entertainment. (Pixar.com, 2009) The Relationship between Pixar and Disney has grown over the years. In 1991, Disney and Pixar entered into the Feature Film Agreement for the development and production of up to three computer animated feature films to be marketed and distributed by Disney. The first film developed, produced, and distributed was Toy Story. Later they entered into a Co-Productions Agreement (which superseded the Feature Film Agreement), to produce five original computer-animated feature-length theatrical motion pictures for distribution by Disney. The five original Pictures under the Co-Production Agreement were A Bug's Life, Monsters, Inc., Finding Nemo, The Incredibles, and Cars. (Pixar.com, 2009) On January 24, 2006, Pixar and The Walt Disney Company agreed to a merger. (Pixar.com, 2009)

Over the years, brand management has changed for The Walt Disney Company, due to technological advancement. Iger explains that Disney does not want to change the way their consumers look at their brand but, change and create different ways that the consumer can keep consuming the Disney brand. With the addition of Pixar, technology made the Disney brand better with and helped to distribute the brand more broadly and effetely. Two important brand attributes are to differentiate and remain relevant. Technology has both helped Disney differentiate from their competitors and kept them relevant in new markets. Consumers are using new technology, such as iTunes and Pixar, to consume products and in order for companies to compete with Disney, they must embrace this new technology. Disney puts their products in place where they are more visible to customers. By using cutting edge technologies Disney has been able to bring its products to its consumers more effectively and has completely changed the perception of the brand and grow their business.

After reviewing the growth The Walt Disney Company gained form embracing new technology one must question why every company is not doing the same. The world is changing everyday with new technology and the Internet, new social networks are being created each year and computers are being used more and more for entertainment. As a new company owner in the entertainment industry, technology must be part of my business in order to compete with other companies. Even though my company, AMP Booking LLC, is not in the same market as The Walt Disney Company, I still feel that I can use the ideas that Robert Iger implemented to make Disney the a leader in the ever changing entertainment industry.

Disney has not changed its product or services, they just embraced the new technology to change the way these products and services are consumed. I focused on those same ideas when starting up AMP Booking. In the past, if an artist wanted to book a concert they would just pick up the phone and call the venue or agent; now the phone is almost obsolete in booking a tour or concert, due to widespread use of the Internet. Understanding this change in technology is why AMP Booking is where it is at today. While the use of the Internet over the phone does not seem like a big change, it is very helpful in the day-to-day operations of a booking/promotions company. The Internet has made it possible to book and promote shows on your own time, instead of playing “phone tag” with the venue or agent. This allows my team and I to book shows on our own schedule, 24 hours a day.

Promoting concerts and tours has changed since the introduction of the Internet. Disney welcomed new technology to bring their products to its consumer in different ways and AMP Booking is doing the same by using the Internet to promote shows. Previously, if a band or promoter wanted to promote an upcoming event they would make posters and flyers and distribute them across town. With the introduction of new technology, the posters and flyers are posted not just on street poles but also all over the Internet. Social networks such as Myspace, Facebook, Reverb Nation, and Twitter, have reduced the need to post promotion materials all over town. Becoming members of these sites are key to keeping on top of the competitors, but it is important to keep these sites updated at all times because more people are turning to the Internet for their entertainment information. With new devices coming out each year it is very important to stay current with new technology and trends.

By using some of the ideas The Disney Company used, AMP Booking will welcome new technology to the company in order to make a stronger brand and keep up with current times. Robert Iger explained it very well when he said, “No matter how much research you do about a market and technology you will miss something before you release that product or service.”(Digitalhollywood.com, 2009) For this reason, it is important to keep up with then newest and hottest things in your market.

Global Entertainment Business Strategy (PDF)