A closer look at the massive restructure of THE WALT DISNEY COMPANY
In a bit of an unexpected shake-up last week, the Walt Disney Company announced a massive restructuring of its business units to streamline and simplify its operations.
Social media spheres were a buzz last week with the announcement which includes news that Parks and Resorts and Consumer Products are being combined into a single new hub meant to bring Disney characters and franchises to life. The new structure also consolidates the company’s Direct-to-Consumer Services, Technology and International Media Operations into a new SINGLE business unit with the goal of capitalizing on growth opportunities worldwide.
Many changes are expected over the coming months but most immediately Disney announced Bob Chapek was named Chairman of Parks, Experiences and Consumer Products and Kevin Mayer as Chairman of Direct-to-Consumer and International Segment. Below are detailed breakouts of the new divisions courtesy of Disney.
PARKS, EXPERIENCES AND CONSUMER PRODUCTS
The new Parks, Experiences and Consumer Products segment will become the hub where Disney’s stories, characters and franchises come to life. Disney’s worldwide consumer products business will be merged with Walt Disney Parks and Resorts under Mr. Chapek. Disney’s global consumer products operations include the world’s leading licensing business across toys, apparel, home goods, and digital games and apps; the world’s largest children’s publisher; Disney store locations around the world; and the shopDisney e-commerce platform. By uniting Disney’s consumer products business and Disney Parks’ robust retail and e-commerce operations, the Company will be able to share resources and best practices to provide consumers with incomparable branded products and retail experiences that only Disney can create.
Mr. Chapek has served as Chairman, Walt Disney Parks and Resorts, since 2015, overseeing the Company’s iconic travel and leisure businesses, which include six resort destinations in the U.S., Europe and Asia; Disney Cruise Line; Disney Vacation Club; and Adventures by Disney. Prior to that, he was President of Disney Consumer Products, where he refocused the business on a brand- and franchise-driven strategy while launching new products and retail experiences that combine technological innovation and creativity.
DIRECT-TO-CONSUMER AND INTERNATIONAL
The newly created Direct-to-Consumer and International segment will serve as a global, multiplatform media, technology and distribution organization for world-class content created by Disney’s Studio Entertainment and Media Networks groups. The new segment will be comprised of Disney’s international media businesses and the Company’s direct-to-consumer businesses globally–including the upcoming Disney-branded direct-to-consumer streaming service, the Company’s ownership stake in Hulu, and its soon-to-be-launched ESPN+ streaming service, programmed in partnership with ESPN.
The Disney-branded direct-to-consumer streaming service, which will launch in late 2019 and has yet to be named, will be the exclusive home for subscription video-on-demand viewing of the newest live-action and animated movies in the Pay TV window from Disney, Pixar, Marvel and Lucasfilm. It will also feature an impressive array of original and exclusive series and movie programming, along with thousands of titles from the Disney film and television libraries. Senior Vice President Agnes Chu will move to the Direct-to-Consumer and International segment and will continue to oversee programming for the upcoming Disney-branded streaming service.
BAMTECH, which is headed by Michael Paull, is developing both the Disney-branded and ESPN+ streaming platforms and will now house all consumer-facing digital technology and products across the Company as part of the Direct-to-Consumer and International segment. This center of excellence for technology and data platforms within the Direct-to-Consumer and International segment will provide the Company not only with increased quality and efficiencies, but also greater consumer insights that will allow for more personalization and substantially improved user experiences.
Management of global advertising sales for Disney’s media properties–including ESPN, ABC, Freeform and the Disney Channels–will move from Media Networks to the new Direct-to-Consumer and International segment, giving advertisers a one-stop-shop for reaching audiences across all of Disney’s media properties, including its online and direct-to-consumer platforms. Rita Ferro, President, Advertising Sales, Disney|ABC Television Group, and Edward Erhardt, President, Global Sales & Marketing, ESPN, will now report directly to Mr. Mayer. Advertising technology operations across the Company’s media properties will also be managed under the new segment.
In addition, to more closely align with the Company’s direct-to-consumer initiatives, the Company’s program-sales operations headed by Janice Marinelli—including global distribution of film and television content to the Disney-branded direct-to-consumer streaming service, Hulu and other third-party platforms and channels, as well as Movies Anywhere–will be integrated into the Direct-to-Consumer and International business segment. Ms. Marinelli will report directly to Mr. Mayer.
The Company’s International Channels—including the international Disney Channels—will also be consolidated into the new business segment. Disney’s International Channels are renowned for providing incomparable branded entertainment programming that is both universally appealing and locally relevant, and the production of localized content will continue to grow under the new structure.
The new Direct-to-Consumer and International business segment will also be responsible for the distribution of all direct-to-consumer services globally.
The Walt Disney International team of regional managers across EMEA (Europe/Middle East/Africa), Asia and Latin America will now report to Mr. Mayer.
During Mr. Mayer’s tenure at Disney, he has overseen the Company’s key strategic acquisitions of Pixar, Marvel, Lucasfilm, and most recently, its pending deal for 21st Century Fox. Prior to becoming Senior Executive Vice President and Chief Strategy Officer, Mr. Mayer served as Executive Vice President, Corporate Strategy and Business Development.
The Disney Media Networks business segment is co-chaired by Ben Sherwood, President, Disney|ABC Television Group, and James Pitaro, who was recently named President of ESPN and previously served as Chairman, Disney Consumer Products and Interactive Media. The Media Networks segment will remain virtually the same, with the exception of the international Disney Channel operations that are moving to the Direct-to-Consumer and International business segment along with management of global advertising sales/technology.
The Studio Entertainment business segment is led by Alan F. Horn, Chairman, The Walt Disney Studios, and remains virtually the same, with the exception of the management of program sales moving to the Direct-to-Consumer and International business segment. The Studio Entertainment segment includes Walt Disney Animation Studios, Disney Live Action, Pixar Animation Studios, Marvel Studios and Lucasfilm, as well as Disney Theatrical Group and Disney Music Group.
The Company expects to transition to financial reporting under the new structure by the beginning of fiscal 2019.