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Ross Restructures Disney Studio with Eye on Digital Future

Ross Restructures Disney Studio with Eye on Digital Future

In order to understand why Disney chief exec Bob Iger is handing the reins of the studio over to Rich Ross, all you have to do is read this Time Magazine feature on the success of Disney’s cable division. As Disney Channel chief, Ross nurtured a succession of teen stars (Miley Cyrus, Selena Gomez, the Jonas Brothers and Demi Lovato), pushing them through the Disney system–TV show, recording contract, concert tour and merchandise–earning literally billions for the studio:

ABC is struggling, sales are way down at Disney’s theme parks and stores, most of its non-Pixar movies have been wan performers, and revenue from DVDs is shriveling. The cable networks, which in addition to the Disney Channel include ESPN, ABC Family, Soapnet and Disney XD, brought in 26% of the company’s $26.3 billion in revenue and 58% of its $4.8 billion in operating income during the nine months ending June 27. In the past three years, they have represented 80% of Disney’s revenue growth.

Since Iger took over the chairman’s reins from Michael Eisner in 2005, he has been more than willing to adapt to the changing technological landscape without regard for the way that things have been done in the past. Studio chairman Dick Cook was out the door two months ago, and after Ross took over the studio, studio president Mark Zoradi also left, followed by marketing chief Jim Gallagher. Miramax head Daniel Battsek is gone, but the specialty division was always a bit of a square peg in a round hole at Disney. The Weinsteins always chafed at corporate oversight. One could hope that this new studio management team–which has just laid off 20 more staffers–would figure out a way to reinvent the label. But that is unlikely.

Ross is overhauling the Disney studio’s marketing, distribution and operations structure.

Bob Chapek moves from president of Disney home entertainment to run distribution for movies and television–theatrical exhibition (still headed by Chuck Viane), home entertainment, pay TV, digital formats and new media. Chapek will hire a new marketing chief to oversee live-action, animation, Miramax Films, DreamWorks, and Home Entertainment. Chapek built up Disney’s live-action and animated direct-to-video business, as well as the innovative KeyChest digital distribution initiative. Before that he was toiling in the salt mines as chairman of the Digital Entertainment Group, the industry confab that has been functioning as a go-between for theaters and studios on upgrading theaters to digital as well as other technological transition issues in music and consumer electronics.

Studio president Alan Bergman, who has been running business and legal affairs and finance (and oversaw the Pixar and Miramax acquisitions, the Weinsteins exit deal and the DreamWorks distribution deal), will also oversee franchises, post-production, Disneynature and The Muppets Studio. Former Pixar technology honcho Greg Brandeau becomes the studio’s chief technology officer and exec v-p. Ex-marketing chief Oren Aviv will continue to run production to provide continuity as a number of major movies run through the pipeline: Tim Burton’s Alice in Wonderland, Jerry Bruckheimer’s Prince of Persia: The Sands of Time and The Sorcerer’s Apprentice, plus the hugely expensive digital thriller Tron Legacy.

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