How Disney CEO Bob Iger Dismantled One of Chapek’s Biggest Decisions

After Bob Iger’s first earnings call back as the leader of Disney, we gained a little more insight into his plans during his two-year contract, which includes undoing a lot of what Bob Chapek had done.

Bob Chapek was hand-picked to lead Disney by then-CEO Bob Iger, but he didn’t prove to be the leader the company needed. Now that Iger has returned to “set the strategic direction” of Disney, he has dismantled what Chapek built seemingly overnight. Here’s how he did it.

At the first company earnings call since his return, Iger announced his plans to restructure Disney effective immediately. When Chapek took over in 2020, he created the Disney Media & Entertainment Distribution (DMED) division — which Iger says “was a mistake.”

“We thought we made the right decision when we chose Bob [Chapek] in 2020. The board decided in November he wasn’t the right person for the job and made a change,” Iger shared.

One reason Disney brought Iger back was to “set the strategic direction for renewed growth” at the company, including “organizational and operating changes” at Disney. Now we know those changes were aimed mostly at DMED.

When Chapek took over as CEO in 2020, he made the announcement of sweeping changes to Disney’s structure, and DMED was born. Focusing on cost-cutting measures to bring profits up after the pandemic and losses caused by streaming, Chapek created DMED to “further accelerate the company’s Direct to Consumer (DTC) strategy.”

DMED was now responsible for distributing and marketing content globally, while the creatives were responsible solely for making content. The new DMED group was now responsible for “all monetization of content” and the oversight of Disney’s streaming services.

Content creation was split into three groups: studios, general entertainment, and sports.

Ultimately, this structure didn’t prove to be successful, and Disney continued to struggle in the streaming department. In November 2022, we learned that Disney’s streaming business had a loss of nearly $1.5 billion, which was one of the reasons Chapek was fired.

But now, Iger is back and has officially announced the new structure of The Walt Disney Company, “aimed at returning greater authority to our creative leaders.” Disney is now organized under three divisions:

DISNEY ENTERTAINMENT

This division will be led by Alan Bergman, who was previously the chairman of Disney Studios, and Dana Walden, who was previously the chairwoman of Disney General Entertainment Content.

Iger said that the company will be taking “a hard look at the cost of everything we make in TV and film.”

ESPN

Jimmy Pitaro will continue to lead ESPN as its own division.

DISNEY PARKS, EXPERIENCE, AND PRODUCTS

Josh D’Amaro will continue to lead Disney’s division that manages the parks, resorts, cruise lines, and consumer products.

Iger stressed that the reorganization will provide “a more cost effective, coordinated and streamlined approach” to the company’s operations, and that it will tie content decisions more closely to financial results.

When it comes to Disney’s streaming business, talk shifted from profits and expansion to a reduction in losses. The streaming business and its mounting losses have been the biggest concern for Disney shareholders.

Iger assured investors that streaming was his top priority at the Walt Disney Company, and Iger and McCarthy projected that the division will attain profitability by the end of Fiscal Year 2024.

The 2023 Disney annual shareholders meeting is taking place on April 3rd, and we expect to learn more about the future of The Walt Disney Company — including the battle for seats on the board, so keep an eye out for updates.

We’ll be looking for more Iger and Disney updates, so stay tuned to AllEars for more.

Does Disney CEO Bob Iger Regret Choosing Chapek? We Have the Answer.

What do you think Iger’s next move at Disney will be? Tell us in the comments.

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