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Extreme makeover: mouse edition.

PEERING AT THE BOX OFFICE CHARTS the other day, I found myself asking, How did the bastion of Mickey Mouse suddenly morph into the home of "Hannah Montana" and "High School Musical"?

I don't really believe in the efficacy of corporate makeovers, but the radical re-invention of the Disney empire will surely inspire a myriad of business school case studies. It seemed only a couple of years ago that Disney was becoming the ultimate in bland brands. Even the core animation business, the plaything of old Walt himself, was mired in mediocrity.

When Robert Iger was brought in as the new CEO two years ago, few predicted that anything dramatic would happen. Iger, we were told, was a company man--one not attuned to shaking things up. Having come of age in the tumultuous era of Michael Eisner, Iger was more likely to covet "peace at last."

This analysis proved both right and wrong: Right, in that Iger has indeed turned out to be a cool-headed strategist, a "company man" who avoids noisy confrontations and never postures in the press; wrong, in that Iger clearly has charted a bold program of change and is fiercely determined to carry it out.

He doesn't fulminate like his predecessor, but those who deal with him daily testify that there's nothing mousy about the King of the Mouse House.

The Iger Era got off to a controversial start. The new CEO clearly paid too high a price for Pixar--and yet, again, he didn't.

In the two years since the acquisition, Pixar has put wind behind the Disney sails. Pixar's creative zeal has contributed not only in animation but also in theme parks, videogames and other arenas: Witness the $1.1 billion makeover of Disney's California Adventure theme park with Toy Story Mania as its centerpiece.

[ILLUSTRATION OMITTED]

Despite concerns about a recession, the company is betting billions on cruise ships, consumer products and other sectors not directly related to film or TV. In theme parks, as with its iTunes initiative, Disney is steadfast in courting younger, digitally savvy audiences. Culturally, it's a big leap from "Winnie the Pooh" to "Cars" and "Pirates."

Even in film, the Iger commitment is both brand-centric and opportunistic. There is less product, but more emphasis on the Disneyfied opportunities of the marketplace ranging from the sophistication of a "Ratatouille" to the teen frenzy of a 3-D "Hannah." The byword seems to be: Less is more.

Despite these transformative times at Disney, there's been an absence of corporate pronouncements. Indeed, Iger's behind-the-scenes style has lately been in evidence during the tense negotiations to end the writers' strike. When most Hollywood CEOs seemed to duck for cover, it was Iger and Peter Chernin, the chief operating officer of Fox, who took on personal stewardship of the talks even as the prospect of a protract stalemate loomed darkly.

"Bob Iger was personally appalled by the possibility that thousands of Hollywood artisans could face unemployment for months," says the top executive of a rival company. "He saw that the industry lacked focus and he invested more of his time and energy than anyone else in settling this mess."

In the face of all this, I asked Iger the other day if he wanted to philosophize about the problems facing Hollywood as well as the continued pace of change at Disney. Typically, Iger demurred.
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Title Annotation:Smoke & Mirrors: BEHIND THE SCENES OF THE BIZ'S DEALS, DECISIONS AND DIVERSIONS; Walt Disney Co.
Author:Bart, Peter
Publication:Variety
Date:Feb 25, 2008
Words:559
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