Bob Iger is showing off pictures he recently took of food. “We’ve got a Szechuan chicken burger, a Peking duck pizza shaped in a Mickey head,” he says in a demeanor one might call “CEO giddy,” as animated as one of the most polished leaders in corporate America gets. “There’s something called siu mai dumplings that are Shanghainese — they’re tremendous!” Seated in a conference room adjacent to his office at the Walt Disney Co. headquarters in Burbank, Iger scrolls his iPad through dozens of photos shot during one of his twice-monthly visits to the new Shanghai Disney theme park. What about a churro stand? “Believe it or not, yes,” he says. “I’ve tasted all the food at the park. Except I haven’t tasted the turkey legs yet.”
Iger, 65, is chatting with The Hollywood Reporter, which has named him the most powerful person in entertainment for his shrewd management of the world’s largest media company. This is just a few days before he took off on his most important trip to China, to christen the $5.5 billion park with leaders of the country’s communist party. Tragically, the day before the opening ceremony, Iger received news that 2-year-old Lane Graves was snatched and killed by an alligator in a lagoon at Disney’s Orlando resort. The horror hit the CEO and father of four (including two sons with wife Willow Bay) especially hard — he personally called the boy’s parents and dispatched his parks chief to Orlando — and illustrated the diverse challenges thrown at the New York native in his role as business executive, brand statesman and manager of the kind of bizarre news events that become amplified because of their association with Disney. “Yes, all CEOs have to deal with investors and to some extent the press, but we get a lot more attention than any other company,” he says before the incident, which occurred a day after Disney donated $1 million to victims of the Pulse nightclub massacre in Orlando (Disney employed two of the 49 killed).
In his 11 years atop Disney, Iger has become the most effective media CEO of his generation. When he was named to the post in March 2005 (a controversial choice, given his lack of film or parks experience), the former weatherman and longtime ABC executive inherited a company whose storied animation studio was in disarray and its stock price at $27.70 a share. Thanks to a management style colleagues describe as respectful yet decisive, growth initiatives at its cable channels and a series of big-ticket deals for Pixar Animation Studios ($7.4 billion), Marvel Entertainment ($4 billion) and Lucasfilm ($4.1 billion), Disney stock closed June 20 at $99.57. The company’s market cap of $163 billion helped earn Iger $46.5 million in 2015, among the top 10 paydays of U.S. CEOs. During his tenure, he has proved himself equally adept at communicating with business leaders (mending Disney’s relationship with Steve Jobs, which led to the Pixar deal), the creative community and a board that includes heavyweights Sheryl Sandberg of Facebook and Twitter’s Jack Dorsey. The Disney film studio has succeeded in the franchise business like none of its rivals (Finding Dory opened to $136 million during the June 17 weekend, a record for an animated film), and its Media Networks division, which includes cable TV, generated nearly $8 billion in operating income in 2015 (four times the film division and half the company’s profits). Just last Sunday, Game 7 of the NBA Finals delivered more than 30 million viewers to ABC, a record for the network’s basketball coverage.
Despite all that, the challenges thrown at Iger only have increased in recent months. Lower subscriber numbers at ESPN have dragged down the company’s share price lately (and the stocks of other media companies; such is the power of Disney), and a fourth-place showing at ABC this season led new TV chief Ben Sherwood to replace network president Paul Lee. Disney delivered record profits in the most recent quarter thanks to Star Wars: The Force Awakens and Zootopia, and its parks, consumer products and film units are firing on all cylinders. But ESPN was all analysts wanted to ask Iger about. “Disney needs to sustain moderate growth on its cable channels, specifically ESPN,” says Steven Birenberg of Northlake Capital. “The Street is very skeptical.”
The Shanghai park represents a legacy play for Iger, which made recent comments by Wang Jianlin, chairman of Dalian Wanda and China’s richest man, especially irksome. “They shouldn’t have entered China,” said Wang, who is launching his own parks. “We have a [saying]: One tiger is no match for a pack of wolves.” Disney has been attacked in the U.S. this year as well for its use of the H-1B visa program, which led to laid-off Disney employees having to train their outsourced replacements. And Iger, a Democrat and Hillary Clinton supporter whom many believe has his own political aspirations, got into a public spat with Bernie Sanders (via Facebook, of all places) over Sanders’ claim that Disney underpays staff. Even outside of Disney, Iger suffered a setback in February when the NFL relocated the Rams to Inglewood over a plan Iger pushed to bring two teams to L.A.
And then there’s Iger’s biggest challenge of all: replacing himself before his retirement in 2018, a task he admits he has yet to fulfill after chosen heir Tom Staggs failed to impress the board. None of these topics were off-limits when Iger sat for a 90-minute interview in his office suite, which features a giant photo of Daisy Ridley in Star Wars and a wax statue of legendary NFL coach Vince Lombardi, which Iger found at an ESPN Zone restaurant.
Before you got this job, you explained your vision to the board for many months. Will that vetting process go on now with your potential successor?
Yes. It has been a rigorous process. The process is far from over, obviously. And the people being considered will be asked very much about who they are and what they are made of. What makes them tick? What their passions are, what their curiosities are, what they bring to the table in terms of their ability to run a company as large, as complex, as important, as valuable as this.
The question you hate: If you can’t find someone, would you stay on?
(Laughs.) I said repeatedly, I have no intention of staying on.
But that phrasing leaves it open.
That’s what everybody else says! I’m leaving in 2018.
Tom Staggs is said to have failed to impress the board with his vision for what he would do with the company.
I think that’s a little too specific. It wasn’t about vision. I don’t want to go back over old territory, but Tom spent a year as COO, and the succession process took place during that period of time. So it gave the board and, myself included, a chance to fully assess who Tom was, even though he worked for the company for a long time. What he represented, what he could do, how he fit in, how he might live up to the criteria that the board and others would expect of the CEO of the Walt Disney Co. And what was ultimately concluded is something I don’t really need to discuss, but that very much was part of a succession process. Does that make sense?
Without characterizing what he lacked, what he had, etc.
Pixar, Marvel and Lucasfilm are run by individuals who operate outside the traditional Hollywood system and report to Alan Horn. John Lasseter and Ed Catmull do their thing in the Bay Area, mostly. Kevin Feige at Marvel operates as an island. And Kathleen Kennedy is running Lucasfilm from London and San Francisco and here.
I would turn that around. The essence of what they do is they are extreme insiders at how they manage, how they care for, where their passions lie for their own storytelling, their own brands and the meaning of Star Wars and Lucasfilm, Marvel, Pixar, Disney Animation. No one knows and has more passion about those stories and storytelling and those brands than they do. And that contributes greatly to their successes. What I’ve really tried to do is to not disrupt that.
Catmull’s book is very much about how he and John maintain the separate cultures of Pixar and Disney Animation while imparting to Disney Animation the essence of what was working at Pixar. That’s very tough.
I spent a full day at Pixar thanks to Steve Jobs and John Lasseter and Ed Catmull when I had broached to Steve the idea of buying Pixar. We began a conversation and I said, “I need to spend a day there. I need to go into the tent for a day.” And he said, “Absolutely.” I went completely alone. I didn’t have a piece of paper and a pen. I had nothing to take notes on. I met every director; they each pitched me seven or eight films. I met everyone. And my takeaway was that there was a culture there that was extraordinary. And that the worst thing that we could do as a company would be to destroy or damage it in any way. When we valued Pixar, everybody said we spent too much for those assets, but a large chunk of what we were valuing was what would happen if we could actually infuse in Disney Animation a culture that wouldn’t be exactly like Pixar but borrowed elements from it and ultimately turn the fortunes of Disney Animation around. Here we are in 2016, we look at Zootopia, which [grossed] a billion dollars coming off of Big Hero 6 and Frozen and Tangled and Wreck-It Ralph. It’s all rooted in the knowledge that Ed and John, the so-called outsiders to Disney but insiders to Pixar, brought to the table. Usually it’s the opposite: You buy a company and basically destroy the company.
Should Star Wars fans be worried about Rogue One doing reshoots?
I’ve seen Rogue One. I’ve seen not only an edited picture but I’ve seen significantly more footage than was even in that picture. That’s actually going to be a fine film.
You have another Lucasfilm property, Indiana Jones, and Steven Spielberg has agreed to make a fifth film. Will there be an Indiana Jones universe, eventually, like Star Wars?
Not like Star Wars, no. But we hope … right now, we’re focused on a reboot, or a continuum and then a reboot of some sort.
From left: Han Zheng, Communist Party secretary of Shanghai; Wang Yang, China’s vice premier; and Iger during the opening ceremony of the Shanghai Disney park on June 16.
Reboot? You’ve got Harrison Ford for this movie, and then the presumption is there will be a younger …
Well, we’ll bring him back, then we have to figure out what comes next. That’s what I mean. It’s not really a reboot, it’s a boot — a reboot. I don’t know.
THR has been using the term “requel” for these sequels that reboot the franchise.
Requel. (Laughs.) We [got] Harrison Ford as Indiana Jones in the film. But then what’s the direction? I’ve had discussions about what the direction is, [but] I don’t want to get into it.
But you do see making more films?
Yes, I do. I don’t think it reaches the scale of the universe of Star Wars, but I see making more. It won’t be just a one-off.
Why do you think the Wanda guys have shown such public animosity toward Disney?
One Wanda guy.
The one Wanda guy who matters.
I have no idea. I was as perplexed by that as anybody else. He owns AMC Theatres. Last I checked, we’re a pretty significant part of that business, given the movies we make and they distribute. We’ve done nothing in terms of Shanghai Disneyland to in any way antagonize or intimidate any potential competitors. China is a big enough land from a people perspective and geography to house far more than one theme park company.
From left: Then-Disney CEO Michael Eisner, Make-A-Wish Foundation CEO David Williams and then-Disney CEO-elect Iger in July 2005.
Have any of your executives been to the Wanda park that is open?
We’ve sent people to that, but I don’t want to comment on what they’ve seen. I don’t even want to comment on Wanda parks, except that we’re not in the same business as they’re in.
Speaking of people who have said things about Disney, let’s talk about the Bernie Sanders thing.
That was pleasant!
It was a little unusual to see you respond like that on Facebook.
Bernie Sanders. Bernie Sanders. I thought about what he said, I thought about how misleading it was, how fact-less it was, how one-sided and unfair it was. I decided it was irresponsible and then I said, “He doesn’t just have a right to tee off on us without someone responding.” And who best to respond in terms of making a point and getting attention than me? And that’s what I did. And by the way, if he does it again, I’ll do it again!
This interview will come out after the California primary, so he may be less of a factor.
He criticizes us about wages, for instance. We’re one of the first companies to commit to taking our minimum wage up to $10, which we did. Without anybody putting a gun to our head, we did it. It was the right thing to do. We said a few years ago we were going to hire veterans, and we’ve hired thousands of veterans. We’ve made huge investments in U.S. infrastructure. What we did at California Adventure [in Anaheim] a few years ago, that was more than $1 billion of investment and thousands of jobs. On the ground. In California. And the other thing that he pointed to, which I do not want to get into much detail about, but this whole notion of using people under the H-1B visa plan, that has been completely misconstrued.
We had a technology group in Orlando that was essentially trained in legacy technology that we were moving away from. We decided that we had to upgrade technology, and the best way to do it was to use a company from the outside to provide that help. That affected 250 jobs. So we went to 250 people and said, we’re basically eliminating your jobs because we need this higher, more modern technology. We found jobs in our company for 100 of those people. That’s nowhere to be found in the stories. So 150 of them were affected, which I don’t take lightly. Although, in this changeover to new technology, we created another 170 jobs for other people. So the net result was actually more jobs rather than fewer. The mistake that was made is that we asked people who were leaving to help train their successors. That’s common in the business, but it doesn’t necessarily mean that it’s right. And looking back, I’m sorry that we did that because there’s something insulting about that. That got a huge amount of attention and rubbed people the wrong way, and I completely understand why it would. It just does not pass a smell test, even if it is common practice.
Some people say your post-Disney life will be in politics.
Yeah, I’ve heard that. A lot of people — a lot — have urged me to seek political office. All kinds of different jobs. Everybody has got a different idea for me, except all roads lead through my wife. (Laughs.)
But you wouldn’t rule out a run for, say, governor of California?
I will not be specific about any office. I wouldn’t rule in or rule out … Honestly, I’m interested in politics, I’m interested in giving back in some form, performing some sort of civic duty. But I’m not exploring a run for governor or senator or anything along those lines. I’m focused on running Disney. Does that answer the question?
Sure. What did you learn from your experience with the NFL and trying to bring the teams to L.A.?
Oh, God, I’m 65 years old and still learning things. The only thing I really learned was that I misread the chances going in. I actually thought the chances that we had — myself and the partnership with the Raiders and the Chargers — I thought the chances were better in the end than what I discovered they were. There was a very, very strong leaning going into that process to bring the Rams here, and I misread how strong that was. That’s all. I wish, by the way, the Rams do great, [that] they build a great stadium.
Will you be a season-ticket holder?
I’m a lifetime Green Bay Packers fan. I doubt I’m going to be a season-ticket holder [in L.A.]. I’m going to keep my allegiance to the Packers.
And now you’ve got Aaron Rodgers’ brother on The Bachelorette.
Some speculated NFL owners wanted to send a message that the NFL is bigger than Disney. Do you agree with that sentiment?
I have no idea. That’s the first I’ve heard of that.
Would you ever be involved in owning another sports team?
Everyone asks, what is the fix for ESPN? You’ve said an improved digital offering is coming. Can you give a timeline for the ESPN digital rollout and what’s going on there?
Well, first of all, when people say “fix,” that usually suggests something is really broken, and it’s not. ESPN is not broken at all. ESPN, like a lot of other media entities, is facing challenges that they haven’t faced before that are due to some very obvious circumstances, which is technology’s effect on media both on the creative side, the distribution side and the consumption side. There’s more competition, the [power] shift from the distributor and the creator to the consumer is pretty apparent. And it’s critical to be as present as possible on all platforms, which ESPN is — but also to monetize them in as effective a way as possible. So what ESPN is exploring, they’re creating more product that can be sold directly to the consumer, while at the same time doing what they can to make the product they sell to the distributors as vital as possible. In terms of timeline, I can only tell you there’s a significant amount of work going on as we speak to move more ESPN product onto new platforms as fast as possible.
So there will be a stand-alone, live-sports, ESPN equivalent of HBO Now or CBS All Access?
I’m not going to say that. Is it inevitable that ESPN will have a more direct consumer product in the marketplace? Yes. What that product is, to what extent it mirrors the product they have now and to what extent it is … I’ll call it an offshoot. I can’t get into those details. I don’t think it’s safe to assume ESPN is going to take the product it has now and immediately take it over the top like HBO did to sell directly to consumers.
It’s even more complicated because many believe ESPN is propping up traditional distributor businesses as people subscribe to their bundle to get live sports.
ESPN plays a vital role in the health of the multichannel bundle, yes. That goes back to the old question of, to what extent are you a disruptor, to what extent do you allow yourself to get disrupted? That’s a debate we have all the time.
ABC finished in fourth place this season, and some of the news properties are softening in ratings. How do you think Ben Sherwood is doing running the Disney-ABC TV Group?
Ben Sherwood is doing great. Ben Sherwood is a great competitor, meaning he loves to compete. And he also is realistic about the challenges that his businesses face, and he has a keen understanding that business as usual is not a successful strategy in a world that has become so unusual.
Kelly Ripa felt blindsided by Michael Strahan’s move to Good Morning America. Do you think that situation could have been handled differently?
(Laughs.) Here’s what I’m not going to do here. I’m not going to extend that narrative.
With Apple CEO Jobs in September 2006.
People said it was Ben’s first public challenge in that role.
He’s had many other challenges.
Hulu, which Disney co-owns, is going to offer live TV channels, which seems to be a rival to the traditional cable bundle. How do you reconcile those?
I don’t mind that. I like aiding and abetting more opportunity for content owners, channel owners. And I like the idea of it entering the marketplace as an alternative to other forms of distribution, because there are many alternatives cropping up.
It’s an interesting situation for Comcast, which backs Hulu and has its massive cable business. And now Hulu is in the distribution business.
Right. When Comcast bought NBCUniversal, what’s the difference? Make my day, Comcast. (Laughs.) Come after us because we’re going into the distribution business. Didn’t you go into the content business and the theme park business? Really?
And Comcast is investing heavily in theme parks and coming after you in animation [with the purchase of DreamWorks Animation].
I saw someone’s comment from the investor community, “My goodness, they’re biting the hand that feeds them” or “What signal does this send to their distributors?” Well, what signal does this send to the content owners when the distributors go into the content business? I haven’t lost sleep over that, but it happens.
I haven’t heard it described that way.
But that’s what it is! It’s the exact same thing. If anything, you could argue that it’s less so because Hulu is an upstart, whereas they bought NBCUniversal! They bought cable channels, they bought theme parks, they bought a movie studio. They went into direct competition with us in broadcast TV, in local TV, in cable TV, in the theme park business and in movies. That’s a lot. By the way, I’m not complaining about it, but it’s hard to believe that us taking Hulu into the direction of becoming a multichannel distributor is something that anybody should be worried about in terms of the message that it sends.
Do you think there will be a correction in the value of sports-rights deals?
There isn’t one in sight.
Even if ESPN stops pumping up prices?
Well, ESPN was pumping them up and Fox and Comcast and Time Warner [too]. I last saw Twitter bought some [NFL] rights. Yahoo is bidding on rights. Who knows what Verizon will do. I don’t see one in sight.
Maybe in five years, seven years?
When I’m governor of California. (Laughs.)
When you’re the governor, do you see the same number of Hollywood studios? Will there be consolidation? Will a tech company buy something?
I don’t think I would describe them as studios. Not that there aren’t studios today. I think there’s a general belief — general among not just the industry we’re in but an expanded set of the industry that includes tech companies and various new entrants into media — there’s a general belief that content is king. You will see more investment in that and that will mean more entrants into it. I wouldn’t conclude that they would become studios per se, but makers of content, as you’ve already seen in TV and movies with Netflix and Amazon. I saw Jeff Bezos not long ago, and he was describing what he was doing. He’s making movies!
Amazon had a great party at Cannes.
Is [Amazon] a studio? What is it? Netflix. Studio?
Do you think Wanda or another Chinese company would take a stake in Paramount if it becomes available?
Now you’re back to Wanda. I don’t know what Wanda is up to. I do not know.
Speaking of Paramount, are you close at all with Sumner Redstone?
No. I had dinner with Sumner twice that someone arranged, but I have no relationship with Sumner.
How will that Viacom saga play out?
Your guess is as good as mine. You know what, we’re fortunate as a company that we don’t have any of that kind of complexity.
Which of the other media moguls are you close to?
I’ve been in the business for 42 years and I’ve been in this job for almost 11. So yes, I know Philippe [Dauman] and Sumner and Brad Grey, Jeff Bewkes, Kevin Tsujihara a little bit. Ron Meyer, Jeff Shell, Steve Burke, Brian Roberts, Michael Lynton, Jim Gianopulos, Rupert Murdoch.
Iger and Bay with sons Robert “Maxwell” Iger (right) and William at the 2011 NBA All-Star Game at Staples Center.
Do you know the sons?
I know Lachlan and James. Not well, but yeah.
The sense is the entertainment industry has taken a backseat in terms of prestige and attention to Silicon Valley. Do you agree?
They’re the ones that are trying to get into our business!
Where does that put entertainment in terms of the pecking order?
I won’t speak for the entertainment industry. I speak for Disney. I’ve seen people in the industry come to work every morning paranoid about what the other person or other company is doing. That means you’re spending time and focus on somebody else’s business instead of your own.
What is success to you for the Shanghai park?
Well, the first thing is just making sure people thoroughly enjoy the experience and that it is operationally smooth, meaning everything is working, crowds are being maintained effectively, the food is good.
I read about the dollar dumplings.
Speaking of dumplings, about 70 percent of the food is Chinese and a lot of it is Shanghai food, although we actually have a restaurant that has seven different areas in it that represent seven different areas of China and their food.
One thing I find amusing about the park is there is no Main Street USA.
That was my doing. I’m pretty well steeped in park lore, and I certainly knew that Main Street was based on Walt’s drive from his hometown. I like Main Street a lot, but I did not think it would resonate with the people of China in any way.
Daughters Kathleen (right) and Amanda with Bay and Iger.
Do you have Jack Sparrow from Pirates of the Caribbean in the park?
And Johnny Depp’s personal problems?
Not worried about it.
The scandal will pass?
I don’t know whether it passes or not. We have Jack Sparrow.
You think people separate.
How’s your relationship with Marvel CEO Ike Perlmutter these days?
My relationship with Ike is good.
But you allowed Marvel’s Kevin Feige to move from under Ike to under film chief Alan Horn. That didn’t rankle Ike?
Sure it did.
Do you see Ike being a major player at this company for a while?
What does a major player mean?
Major stockholder. Influencer.
I have no idea what he does with his stock. He’s made a lot of money on the Marvel transaction, and he’s made a lot of money on Disney stock since he took it as part of the transaction and bought more since then. And he gets a big dividend. I’m actually not in his head in that regard, so I don’t know and he doesn’t in any way discuss it with me. He likes to call me at seven in the morning. Sometimes I’ll say, “Ike, I’ve just pushed the button on the coffee maker and I haven’t had my first cup yet, so I need 10 minutes.”
Who do you lean on when making decisions? Who are your confidants?
I have a great team. I have [communications chief] Zenia [Mucha], a great general counsel [Alan Braverman], chief strategy officer [Kevin Mayer],I have a very strong and relatively new CFO [Christine McCarthy], and I have a great head of HR [Jayne Parker]. That’s the core corporate team. And then the business unit team, Alan Horn is right down the hall and Ben [Sherwood], who is relatively new. This is a team I work very closely with. For instance, we have lunch every Monday. We had lunch today for an hour and a half, and the first thing I did was show them a seven-minute video of Shanghai … just to get everybody in a good mood. Then we did a business update, we talked about Wanda, we talked about some of ESPN’s issues, we congratulated ourselves that we have the Warriors and the Cavaliers in the NBA Finals. It’s a mutually supportive environment. There’s always politics in any company, but it’s a fairly politically free senior team. I’m going to share everything with you. If you burn me, that ends the sharing process.
This story first appeared in the July 15 issue of The Hollywood Reporter magazine. To receive the magazine, click here to subscribe.