Bob Iger spent the past 12 months overseeing the endgame for Marvel’s Avengers franchise and the last installment of the Star Wars Skywalker saga. This week, the longtime leader of The Walt Disney Co. unveiled one more curtain call: his own. In a move shocking as much for its timing as its substance, Iger stepped down Tuesday as Disney’s CEO and named another Bob — top lieutenant Bob Chapek — as his replacement. Iger had telegraphed his retirement plans for years, and Chapek was long considered a potential replacement. But there had been zero indication he’d step down before his contract ran out at the end of 2021 or that he would hand over the keys to the Magic Kingdom without a hint of warning. Not surprisingly, the sudden announcement prompted plenty of questions (and at least a few Succession quips). Here are four of the most pressing ones.
Who is Bob Chapek, and why did he get the gig?
First and foremost, he’s a company man. Chapek, 60, joined Disney in 1993 and has spent two-thirds of his professional life inside the Magic Kingdom. The bulk of his Disney career has been in distribution, figuring out new (and profitable) ways of managing the Mouse House’s enormous library of intellectual property. In the 1990s, his focus was on home video: He was the architect of the so-called Disney “vault†strategy, in which the company limited the supply of key movie titles in order to goose demand. Later, Chapek also helped Disney’s distribution arm transition to emerging formats, first from DVDs to Blu-ray and then from physical media to digital downloads like iTunes.
During the 2010s, Chapek got more involved in the consumer-facing aspects of Disney’s business. He took over consumer products — everything from toys to apps to retail stores — in 2011 and was given oversight of theme parks and resorts in 2015. (The Succession parallels really are a bit creepy.) Chapek’s tenure overseeing theme parks ushered in big changes, including the launch of Star Wars: Galaxy’s Edge at Disneyland and Disney World last summer, as well as the opening of Shanghai Disney in 2016. In 2018, Iger consolidated theme parks, consumer products, and so-called “experiences†(like Disney cruises) into a single unit and put Chapek in charge.
While the timing of Iger’s announcement shocked most in Hollywood, Chapek’s selection isn’t a complete surprise. He’s been mentioned as a possible heir to Iger for years, in part because he’s overseen so many key parts of the company. That said, over the past year or so, media and Wall Street speculation about a successor had focused on Kevin Mayer, who runs Disney’s direct-to-consumer TV arm (think Disney+ and Hulu). Such conjecture was reasonable, given how important streaming is to Disney’s future and in light of the blockbuster launch of Disney+. Mayer clearly has a better understanding of where Disney’s video future is headed than Chapek, and he also has a deep understanding of the importance of building a direct relationship with consumers.
But per some industry experts, Chapek is just as skilled on the latter front, perhaps even more so. “Disney is now a consumer-facing company not just with theme parks and products, but also with media,†tweeted Alex Kruglov, CEO of mobile game app pop.in, who previously spent six years as head of content acquisition at Hulu. “The DNA of delighting the consumer is what will make them succeed. Media coverage that implies Chapek doesn’t have consumer experience is absolutely nonsensical.†And Michael Nathanson, Wall Street analyst at MoffettNathanson, told CNBC on Wednesday that Chapek was “probably the best-qualified person in the company to take this job. His history in all the divisions that really matter really is very supportive of him taking on that role.â€
Iger may have also decided he wanted someone who had a better grasp of a wider range of the company’s core assets. On Thursday, media and tech analyst Ben Thompson wrote that Iger ignored the sexier business — streaming — in favor of an exec with a broader portfolio. “As compelling as Disney’s direct-to-consumer video businesses are, they are still a relatively small part of the company and, crucially, only make strategic sense because of the rest of the company, particularly the parts under Chapek’s management,†Thompson argued. “It is easy to imagine Mayer, taking over Disney after having successfully launched Disney+, falling into the trap of letting the tail wag the dog. Disney+’s full potential comes not from beating Netflix but rather from making Disney as a whole far stronger and more integrated. Chapek, with his background in not just Parks and Resorts but also Consumer Products, is likely to be much more cognizant of the whole, even as Disney+ gets all of the attention from people like me.â€
Why did Bob Iger step down now?
Iger’s Disney contract extends through the end of next year, leading industry types to figure any successor wouldn’t take the reins until 2022 at the earliest. The decision to simply put Chapek into Iger’s old role as CEO right away, and to do so with an out-of-the-blue announcement on a random Tuesday afternoon, left Hollywood and Wall Street shell-shocked. There was social media chatter that perhaps Iger had decided to launch a last-minute bid for president, speculation repeated to me in phone calls from at least two senior media execs. For the record, Iger laughed off that notion in an interview with the New York Times, saying a transition plan has been in the works for months. “It’s only abrupt in other people’s eyes because we haven’t been talking about it publicly,†Iger told the Times, adding that the Disney board had “identified Bob actually quite some time ago as a likely successor.â€
And it’s not as if Iger has just walked away from Disney. While no longer CEO, he’s still at the company and retains a degree of control. His new title is executive chairman, and he’ll be focusing on “creative matters†— like what’s next for Marvel and Star Wars. Chapek has day-to-day oversight of the Mouse House, but he reports to Iger until December 31, 2021. That’s when Iger’s contract will expire and, barring new developments, he’ll officially retire from Disney.
Iger apparently opted against an extended transitionary role for Chapek because he didn’t want to create doubt Chapek would eventually get the CEO gig. In 2015, Disney unofficially identified Tom Staggs as Iger’s successor, positioning him in an interim role widely seen as a pathway to the top spot. Barely a year later, Staggs was out. By contrast, naming Chapek CEO now gives him latitude to start doing the job right away, even as Iger remains his boss and trains him on creative matters. What’s more, Iger told the Times this setup gives him time for “getting everything right creatively … I could not do that if I were running the company on a day-to-day basis.†This seems logical: Following a blockbuster year, Disney finds itself facing creative resets with many of its key franchises, including Star Wars and Marvel. Iger will be able to oversee the execution of new visions for both those brands, even as he shows Chapek the ropes in dealing with Hollywood talent.
How will Disney’s new boss connect with Hollywood?
Chapek will clearly need Iger to act as Yoda to his Luke Skywalker when it comes to Tinseltown. It is no exaggeration to say the town pretty much has no clue who he is. When I emailed a very senior exec at a major Hollywood talent agency to get his take on Chapek — this is someone who will made deals worth hundreds of millions of dollars and knows virtually every key player in the business — he had a two-word response: “No idea.â€
Veteran entertainment business reporter Cynthia Littleton of Variety perfectly captured Chapek’s challenge in her analysis of the transition. Chapek, she wrote, “has no hands-on creative experience, unlike Iger, who came to the job after years of experience with entertainment and sports programming from his earlier tenure at ABC. Chapek’s ability to schmooze with talent and court top filmmakers will be tested at a time when there’s no shortage of studios chasing A-listers.â€
One Walt Disney Co. insider who knows the new CEO a bit predicts mastering the ways of Hollywood could prove a challenge. “I think he is a good choice … but the fact that he beat out Mayer is surprising,†the staffer said. “Kevin is the more dynamic figure. Bob is a little bit more reserved. But he’ll learn those things.â€
This could be one reason why Iger designed such a long transition phase: Over the next two years, Chapek will likely shadow Iger in countless meetings and negotiations, observing the unique peculiarities of talent relations and creative decision-making. Wooing the next J.J. Abrams is a different skill set than figuring out the fastest way to get Baby Yoda plush toys into production. Still, the Disney insider says it’s worth noting how much of a departure Chapek is from the Disney CEO template: Both Iger and Michael Eisner, who ran the company from 1984 until 2005, had deep Hollywood roots before taking the top spot.
What happens next?
Since many in Hollywood and Wall Street considered Mayer the odds-on favorite to succeed Iger, the fact that he didn’t get the promotion raises the question of whether he’ll now start looking for new job opportunities. “My guess is, this was a gut punch to Kevin,†the Disney insider told me. There’s certainly precedent for execs’ calling it quits when they’re passed over for expected promotions, and given Mayer’s phenomenal success overseeing the Disney+ launch, he’ll no doubt have plenty of suitors at rival entertainment conglomerates looking to lure him away in the coming months. One source with deep knowledge of the media business predicts it’s almost a given Mayer will move on within less than two years.
Then there’s the question of what changes Chapek will make once he gets situated in his new role. He’s known for being ruthless in his pursuit of growing profits at his divisions, often through cost-cutting. Disney has already been slashing jobs in the wake of its purchase of Rupert Murdoch’s Fox assets, and some Hollywood insiders believe Chapek will speed up the process, especially on the TV side. Disney already has multiple TV production labels as well as at least one severely underperforming cable network in Freeform. “He will go in there and cut the fat,†predicted one executive familiar with Chapek’s management style. The Disney insider told me there was already lots of internal gossip, even before the CEO shift, of changes in the works at Disney+, including talk of a new role for Dana Walden, who heads up Disney TV Studios and ABC Entertainment and oversees scripted programming for Hulu. “You’re going to see some dominoes fall,†the Mouse House source said.