A Disney World Pervert’s Take On: The Existential War Of Investor Aggression
In capitalism, there is no such thing as a company that is too large or diversified or profitable to escape altogether the existential threat of impatient investors. Take, for example, the Walt Disney Company, which in 2023 Forbes ranked as the 87th-largest company in the world, and which at its height employed something like a quarter of a million people.
Disney has shown year-over-year growth—not just profit, but growth, as in this year's number being larger than last year's—in 42 of the last 56 fiscal quarters, a period that includes both massive upheaval in one of its core business areas and, you know, a global pandemic. There's an entire conversation to be had about the baseline insanity of that—about the extravagant lengths that a company of that size and ubiquity must go to in order to grow more-or-less ceaselessly in years 87 through 100 of its existence—but the point is that however deranged that particular game may be, Disney is playing it reasonably well.
Despite all that success, Disney's stock has lost value over the last five years. In the incredibly rational world of Big Business, this kind of thing is considered normal as hell. Since hitting a high of about $202 in March of 2021, shares of Disney have fallen in price by approximately 45 percent, to a Thursday midday trading price of around $111. The company's market cap—the total value of all outstanding shares—has dropped by a whopping $160 billion, much more than a third of its March 2021 height.
This is because investors and Knowers Of Big Business do not always share the common person's idea of what makes for a successful company. Where you or I or the vast overwhelming majority of Disney's couple of hundred thousand employees conceive of business as the selling of a quality product or service to a customer at a profit and using that profit to pay for things like salaries and benefits, Big Business Knowers understand that all of everything that I just typed is horseshit. Big Business Knowers understand that True Business—again, entirely rational and good—is in fact about becoming vastly larger, at every checkpoint, no matter what, forever.
Here is a mild but conveniently close-to-home and neatly comprehensible example: A couple of media reporters at the New York Times published a blog Tuesday about small digital media startups using unconventional structures—in this case "unconventional" should be interpreted to mean "not yet entirely owned by ravenous capitalist shitheads"—to stand themselves up in an otherwise insanely bleak and beshitted industry landscape. As we at Defector know a thing or two about this phenomenon, a bunch of us read this story with great interest, and were disturbed to find within it this disheartening sequence of words:
Of course, nothing in media lasts forever—particularly in the fast-changing digital world. So there’s no guarantee that the early success of these companies will translate into sustained growth.
New York Times
I'm going to go out on a limb and suggest that if you asked the workers behind a healthy majority of these new media startups—and one in particular—to list their priorities for their fledgling businesses, Growth would fall somewhere down the list, far below things like Do Good Work and Exist One Year From Today and Please For The Love Of God Allow Me To Contribute Income To My Poor Starving Household. A healthy number of media workers would rank Growth behind Protect Me And My Work From All Growth Imperatives. But because these Times reporters are savvy types—and because they have to signal their business savvy to the Times' Big Business Knowing readers—obviously they cannot be allowed to take small media startups very seriously unless those startups are hoping to one day drain the world's oceans so they can find and kill God. Most ideas about modern business operate with the baseline assumption that if your ambitions do not include conquering the world, at best you will only be allowed to survive in your disgusting plebeian complacency until a stronger force comes along in your industry—a proper world conquerer—and summarily karate-kicks your head off.
In the case of the grotesquely overgrown Walt Disney Company, which has been in the hands of straightforwardly evil Big Business Knower freaks for longer than anyone at Defector has been alive, Growth doesn't only outrank Good Work and Continue To Exist as a priority of the company's stewards; Growth's preeminence as an investor objective has reached the point now where doing good work and continuing to exist can be said to undermine the company's very purpose. This, too, is just a part of the lifecycle of an investor-owned business: Good work is after all more expensive to produce than shoddy work; existing undeniably costs so much more in terms of overhead than ceasing to exist. A company whose growth has stalled—and, more specifically, one whose capacity for growth has finally been maximally exploited, by its having been cartoonishly diversified—cannot any longer meet its responsibilities to its investors as easily by continuing to exist as it can by fracturing into things that can be sold piecemeal for cash to other companies.
There are big powerful investors in the Walt Disney Company who believe the time has come for this behemoth of an entertainment conglomerate to get aggressive about strategically losing limbs. In Big Business, it is not considered an abandonment of principles or otherwise any sort of conceptual reversal to call for a sale of assets after having supported as recently as nine minutes ago the bold and often reckless sequence of expansions and mergers and wild extravagant investments that grew your company into a bloated monstrosity in the first place. These courses only seem to express opposing theories of corporate stewardship, until you are reminded that the Friedman doctrine has made the primacy of shareholder value the equivalent of a natural law of modern business. The lifecycle of a business is thus pretty well pre-ordained; the socially responsible Business Knower understands that expansion makes sense exactly until the very moment that it ceases to deliver maximum value to shareholders, at which time the thing that makes sense is the exact opposite. If there is still a company at the far end of that curve, hey, sweet, time to do some expansion.
Bob Iger, during his first stint as Disney's CEO, was the point person for an era of wild expansion; as Iger is once again Disney's CEO, he might reasonably have experienced some remotely humanity-adjacent reluctance to take on the nasty work of putting asunder that which he himself in happier times coupled together. But unless you are his personal therapist, you would have a hard time detecting any humanity in his actions: Iger announced a plan in November to slash an astonishing $7.5 billion from the costs of Disney's businesses, via restructuring and a workforce reduction that last year included a whopping 7,000 layoffs. This bloodbath helped keep profits up, which was a boon to Disney's investors: In a February earnings release, per Financial Times reporting, Iger announced a $3 billion stock buyback program and an increase in dividend payments of 50 percent. This is a sweet deal for Disney shareholders, who can expect from this course of action both income and an increase in the value of their shares, and for the low moral cost of stripping jobs from thousands and thousands of the company's workers.
This has not been enough to appease the feistiest of the company's most powerful shareholders. Billionaire investor Nelson Peltz, CEO and founder of activist investment group Trian Partners, which FT says controls something like $3 billion of Disney stock, wants to overthrow Disney's board of directors and seize control of the Disney ship, and has recruited into the effort another activist investment group, Blackwells Capital. Peltz, according to a Disney business filing, has tried 24 times in two years to get onto the company's board; he launched his latest proxy attack in November, after Trian declared in a statement that Iger's month's long effort to "right the ship" had failed to deliver the goods to shareholders.
Trian's case, laid out on a website with the title "Restore The Magic," is that Disney's stock has underperformed the S&P 500 for too long, that Iger's plans for the future of the company in general lack specificity, and that Iger's handpicked board nominees do not have the experience or impartiality to hold him accountable for performance. Peltz has nominated in their stead himself (naturally) and a man named Jay Rasulo. Rasulo, notably, was chief financial officer at Disney before resigning in a huff in 2015 after Iger passed him over in his succession plans in favor of the bumbling and hostile Bob Chapek. There's nothing that says Rasulo would've done a better job, but it's worth noting that Iger is back in the saddle today because Chapek was an absolute catastrophe at the head of the company. Chapek's defining move at Disney was to throw breathtaking sums of money into fighting the streaming wars, and then working to recoup some of that cash by boosting to even more obscene levels the prices and fees charged to visitors at his company's popular theme parks, accomplishing the rare feat of inspiring hostility to the Disney corporation in people who have willingly conditioned themselves to squeal in delight in any occasion where they spot three circles arranged just so.
Wagons are being circled: Another Disney investor, activist hedge fund ValueAct Capital, jumped to Iger's defense in January, pledging to support Disney's nominees for the board of directors at the company's annual meeting in April. Jamie Dimon, the powerful chief executive of JP Morgan Chase, the world's largest bank by market capitalization, issued a statement Wednesday supporting Iger and Disney's nominees to the board. Notably, Disney has paid JP Morgan Chase a whopping $160 million in fees since 2014, per Financial Times. Peltz, meanwhile, evidently has the backing of billionaire investor Isaac Perlmutter, who is one of Disney's largest individual shareholders and who sold Marvel Entertainment to Disney in 2009 for $4 billion. Perlmutter, who was a Disney executive for most of 14 years following the sale, himself participated in the irksome effort to shove Peltz onto Disney's board; for his efforts, he was among the 7,000 employees laid off in 2023.
Perlmutter is a confidant of Donald Trump; the intensely private billionaire weirdo was at Mar-a-Lago in December 2016 for transition meetings with the then–president elect. There is a non-zero chance that part of Perlmutter's hostility toward Iger has to do with Disney going woke and opposing sweaty pig Ron DeSantis's campaign of governmental hostility toward gay and trans Floridians, a feud that spawned the establishment of a new governmental agency for the all-but-express purpose of antagonizing a theme park.
All of this proxy maneuvering shit will come to a head on April 3, when Disney holds its annual meeting and formally selects its board of directors. Disney, as a globe-spanning conglomerate, is facing a dire and perhaps overdue existential crisis. You could almost forget amid all of this turmoil that Disney has a wildly successful movie production business; it's got several of the biggest and busiest tourist attractions on the planet; it's got a growing fleet of enormously popular cruise ships; it rakes in tens of billions of dollars in profit every year; and it's got legions of some of the most psychotic devotees in the history of fandom.
Hey, while we're on the subject of Disney fandom, I, a sick Disney World Pervert, have some key pointers for whichever monstrous anti-human faction of ravenous investors manages to take control over this nightmare abomination of a company.
Item 1: I Should Be Allowed To Continue Riding Rides At Disney World Theme Parks After Closing
For years and years, Disney World had a feature called Extra Magic Hours, which allowed guests of Disney-operated hotels ("guests" is the word Disney World uses instead of "patrons" or "visitors" or "customers") to stay an extra couple of hours at a given theme park after it closed to the general public. One night it would be two hours at Animal Kingdom (generally a waste of time, except that the park is gorgeous after dark), the next night it would be two hours at Magic Kingdom (the best possible good time known to humankind). Then, like a lot of things, Extra Magic Hours went away during the pandemic, when park access became more limited and (importantly) Disney ruthlessly shit-canned thousands and thousands of theme-park workers.
Extra Magic Hours are back now, only now they're called Disney After Hours, and, instead of being for all guests of Disney-operated hotels, they are now only for guests of Disney's ultra-expensive "deluxe" resort hotels. As I am a simple blogger who cannot afford to participate in "deluxe" things, this, to me, is bullcrap. Please fix this immediately, if not by restoring the old system then by giving me and only me a special pass for Disney After Hours access, and possibly even a special secret entrance.
Item 2: I Do Not Like This New Cirque du Soleil Show At Disney Springs
Disney World has this large commercial area with shops and restaurants, called Disney Springs. This area used to be called Downtown Disney, when it was even less themed and was basically just a place for [freakish Disney] adults (like me) to have a nice dinner among other [freakish Disney] adults, after a day of jamming out at the theme parks. It's much bigger now and has some water features and has been renamed Disney Springs. There's a Jaleo and a two-story Masaharu Morimoto joint, and the Planet Hollywood was en-sleeked and stripped of its psychedelic cheesiness, which has somehow made it even less tasteful. There is a huge, fancy, enclosed performance space at one end of Disney Springs, and it is occupied by a permanent company of Cirque du Soleil, the insanely cool Canadian contemporary circus producer.
For many years the Cirque du Soleil show at Disney Springs was called La Nouba, and it was perfect. It was powerfully weird, even spooky; the music was incredible; the clowns were the best ever. (An aside: I have been pulled on stage during performances of La Nouba at least three times that I can remember, including one time where I had to lay on the floor between two clowns while the show's bicycle stunt people did increasingly elaborate jumps over my neck. Turns out the ticket program tends to seat adult childless couples in a narrow handful of spots, so that the performers know where to look for a dopey man to pull on stage for some crowd-pleasing humiliation.)
Over time La Nouba became less popular, for two reasons: First, these shows are not cheap and once you've seen it, uh, 11 times, you start to wonder if that 12th time is quite worth the investment. Second, word got around via the incredibly many websites devoted to Disney World tourism that La Nouba was not necessarily suited for people who are younger than, say, 12 years old, which I'm sure you can imagine is not great for business at a large theme park for small children.
La Nouba also went away during the pandemic, and the theater sat closed for years. When the doors finally reopened, in Nov. 2021, Cirque du Soleil debuted a new show, Drawn to Life. Drawn to Life, unlike La Nouba, is full of Disney-specific material, and is about animation and childlike wonder and so forth. The stunts still whip mondo ass, of course, but the story is heavy-handed and wack and the production badly misses the eerie weirdness of La Nouba. This fits an ongoing trend at Disney World, of attractions ("attractions" is the word they use at Disney World to cover shows and rides and every other thing you might stand in line to experience) becoming more explicitly tied to existing Disney intellectual property. Instead of an interesting new environment, each new ride and land and parade and nighttime spectacular is now directly tied to at least one Disney or Disney-owned movie or television show. It's stinks. Cirque du Soleil's producers and Disney's vaunted Imagineers alike are having their styles severely cramped by this relentless cross-promotion.
Please replace Drawn to Life with something that is less wack and has no cartoon characters.
Item 3: I Would Like To Ride The Upcoming Tiana's Bayou Adventure Attraction Before Summertime
Disney World recently closed up forever the famous and beloved but deeply problematic Splash Mountain attraction and has been working to reskin it with theming from The Princess and the Frog. This new ride—still a meandering and toe-tapping river journey with a thrilling log-flume finish—will be called Tiana's Bayou Adventure. I realize that I just griped about Disney's recent effort to tie everything in all its parks to something from its catalogue of motion pictures, but I am nevertheless looking forward to riding this ride. It is slated to open up this summer, which seems like a reasonable timeline, except that I will not be visiting Florida in the summer (an even more hellish than usual time to be in central Florida). Instead I will be visiting Florida in April, and it would please me greatly if Disney carved out an opportunity for me to ride Tiana's Bayou Adventure at that time.
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