Guests: Bruce Orwall, Charles Gasparino, Mark Gunther, Kim Masters, Robert Evans
ANNOUNCER: DEBORAH NORVILLE TONIGHT.
DEBORAH NORVILLE, HOST (voice-over): Shakeup at Disney: He‘s been ruling the Magic Kingdom for 20 years.
MICHAEL EISNER, CEO, DISNEY: Today marks the dawn of a new era.
NORVILLE: Now after years of public personality clashes, declining stock.
EISNER: We will take creative risks while mitigating the financial risks.
NORVILLE: . and revolting shareholders.
ROY DISNEY: If I had enough rifles, we could have this thing over with.
NORVILLE: . Disney CEO Michael Eisner is stepping down.
Tonight, a look back at one of the most turbulent reigns in Hollywood.
STANLEY GOLD: We will not be happy until Michael Eisner is out of this company.
DISNEY: We need to do this because it‘s the right thing to do.
NORVILLE: The rise and fall of Disney mogul Michael Eisner.
EISNER: I love this company.
ANNOUNCER: From Studio 3-K in Rockefeller Center, Deborah Norville.
NORVILLE: And good evening, everybody. After 20 years at the helm, Michael Eisner has announced he‘ll be leaving the Walt Disney Company. But it‘s not happening anytime soon—in two years, when his current contract expires in the year 2006.
Eisner announced his future departure plans in a letter to the Disney board. And his plan to leave his post is big news in all the media circles and on Wall Street today. The story was carried this morning on the front page of “The Wall Street Journal.”
And joining me now is the “Journal‘s” Los Angeles Bureau Chief Bruce Orwall, who interviewed Eisner just before the announcement.
Bruce, you broke the story. It was front page, right-hand side of the “Journal” this morning. When you talked to Eisner before the announcement, did you have the sense that he was going to be making this move?
BRUCE ORWALL, L.A. BUREAU CHIEF, “THE WALL STREET JOURNAL”: Well, yes, that‘s why I spoke with him. I mean, I had been chasing for a while the notion that he was going to do something. A lot of people thought that, you know, Michael Eisner would never leave this company willingly, that he‘d be carried out of it someday.
And you know, I think over the summer a lot of—some insiders saw that there were signs that maybe he was moving toward a decision to try to take control of his own destiny a little bit with the critics and criticism that he‘s endured in the last year and maybe tried to control the situation a little bit.
NORVILLE: Why now? Why two years before his contract expires and about six months after the shareholder revolt that happened at the annual meeting?
ORWALL: Well, there‘s sort of a unique moment here that I think he‘s trying to take advantage of. After a long period of declining earnings, the company is in the middle of a financial turnaround right now that has started this year. And they‘re hoping to sustain it in the next couple of years.
He weathered the storms earlier this year in which shareholders like Roy Disney came after him and Comcast tried to buy the company.
But what a lot of people don‘t realize is that going into the fall and winter, there are other storms that are on the horizon. Roy Disney‘s campaign is going to continue. They‘re going to continue to trying to oust Eisner from the company. And I think he has a moment right now where he can do this a little bit on his own terms that he wants to try to take advantage of.
NORVILLE: Does he think that he has handled the affairs of the Disney Company in the last four or five years as well as he could have?
ORWALL: Michael Eisner does not admit big mistakes very readily. He will occasionally concede that a deal or two was wrong, or was maybe misdirected, or they overpaid when they bought the FOX Family cable networks, for example. He‘s admitted that they overpaid.
But by and large throughout that entire period, I feel that he has - I think that he has felt that he‘s had the company on the right course and that they‘ve, you know, endured some bad luck and what have you.
NORVILLE: And I guess it‘s no accident that his announcement comes after they announced third quarter earnings that were up something like 20 percent over the year before. I mean, he‘s doing this at a time when the news is good about the company.
Is it his expectation, do you think, that the next two years he can burnish up Disney and leave, you know, as a big star the way he was when he first came into the company?
ORWALL: I think that‘s definitely got to be his agenda. I mean when he—the first 13 years of this company that he was in control of the company, from 1984 to 1997, he was one of the biggest superstars in corporate America. The stock was flying, the earnings were high, the animated movies were hot, and they were doing great.
But you know, the last seven or eight years have really been marked by falling earnings, falling stock price, and the series of clashes with ex executives or current executives of the company, people like Jeffrey Katzenberg, who was the former studio chief, and then Michael Ovitz.
ORWALL: . who was briefly the president and things like that. And I think that now he - you know, he has an opportunity to try to—he‘ll never erase that stuff from the record, but if he can return the company to financial glory in the next couple of years, I think he can at least mitigate a little bit what, you know, what that says.
NORVILLE: You know, one of the things he said in the letter that he sent to the board members of Disney, he said, “I expect that the next two years will be critical to the future of our company, that we must take advantage of the positive projections we anticipate. The momentum has changed, but in a sense, it‘s harder to manage a company in success than in failure.”
That almost sounds like a little bit of a mea culpa. Hey, don‘t blame me. We‘ve made so much money there for so long to take the revenues from what $2 billion to $67 billion. Don‘t forget what I did in the past. And forgive me a few of the missteps lately.
ORWALL: They‘ve always been able to—he‘s always been able to say, even when the stock fell, even when the earnings were down, he‘s always been able to coast a little bit on the growth in the first 13 years, because it was just so enormous.
ORWALL: I mean, you know, the people who invested a small amount of money became wealthy off of their Disney stock. And you know, if they started in ‘84, and they still would be. It‘s just that, you know, I think when he says the next couple of years are critical, I think what he, in part, means, at least subconsciously, is that they‘re critical for him and his reputation.
NORVILLE: Yes, you bet, not to mention he‘s got, what, $320 billion -
· million worth of Disney stock right now.
We‘re going to expand our conversation now and be joined by “Newsweek‘s” Charles Gasparino and “Fortune” magazine senior writer Mark Gunther.
Gentlemen, as we look ahead, the big question now for the Disney Company is who replaces Eisner?
Mark, let me start with you first. Who were your top three best bets for replacing Mike Eisner?
MARK GUNTHER, SENIOR WRITER, “FORTUNE”: Well, I don‘t think you can count out Bob Iger, the president of the Disney Company. He‘s the number two guy. He‘s Michael Eisner‘s choice. He has personal relationships with the board members. He also has some negatives, but he‘s going to be a candidate. I think Meg Whitman is a strong possibility, the CEO of eBay. She‘s done a great job over there. She used to work at Disney. She‘s a very collaborative leader, unlike Michael Eisner.
NORVILLE: You don‘t believe her, though, when she says that she‘s not interested in the job?
GUNTHER: I would expect her to say that.
GUNTHER: . because she has a lot of people at eBay depending on her.
And I take her at her word, but it‘s a very attractive job in many ways. And the third person I‘d look to might be Paul Pressler, the CEO of Gap, another former Disney executive. Did a very good job at the theme parks there. Very well liked.
And again, if you ask any of these people, they will tell you I‘m very happy where I am now.
GUNTHER: But that‘s kind of standard boilerplate.
NORVILLE: Two outsiders who used to be insiders.
Charley Gasparino, who would you say?
CHARLES GASPARINO, “NEWSWEEK”: Well, Bob Iger obviously works there now, knows what goes on inside the company.
NORVILLE: And he has Mike Eisner‘s blessing, too. Eisner‘s publicly said he‘d be my pick.
GASPARINO: Right. Although, you know, given Eisner‘s record over the last couple years, that might be a negative.
GASPARINO: Meg Whitman, I think, would be a great choice, although, you know, I‘m a little less sure about that one. I think Mel Karmazin is the guy that‘s going to do it. That‘s my prediction.
NORVILLE: Having run the Viacom Company?
GASPARINO: Right, having run and being a guy that‘s very well respected by Wall Street. I mean, Wall Street really likes Mel Karmazin.
NORVILLE: Bruce, who do you pick?
ORWALL: Well, I‘m certainly going to agree with both of the other gentleman that Bob Iger is going to be a strong candidate here.
NORVILLE: Is it his to lose, do you think?
ORWALL: I don‘t think you can really say that yet. I mean, one of the things that he has to deal with is that even though he‘s had wide responsibilities at the company, including overseeing successful properties like ESPN and the consumer products division and things like that, you know, his legacy at the company is largely in broadcast television. And the ABC Network has not been doing that well the last few years. It‘s been an - it‘s held the company back at times.
And you know, I think he needs for them to have a strong fall season for him to become a real favorite somehow, if a favorite does emerge.
NORVILLE: Yes, And ABC is down 8.2 percent, according to the latest figures from the Nielsen people.
Mark, I‘m sorry, I want to ask you, a lot of people say that one the problems that Michael Eisner has failed to deal with is that the Disney assets are worth an awful lot. Probably what the share value is. It went up about a percent today. But that he hasn‘t unlocked the value and made it so that shareholders can realize that. Would you agree with that?
GUNTHER: Well, I guess I would put it a little bit differently. And that is to say that I agree with Bruce. He had a fabulous run for 12 or 13 years. And he‘s had a pretty terrible run since then.
The sense in which he hasn‘t unlocked the value of the assets, is really he hasn‘t unlocked the value of the people working with him at Disney and his partners and the rest of the media business.
Very, very tough guy to work for. Morale of the company has been dismal for sometime. And he‘s driven away a lot of very talented people. I mean, Jeffrey Katzenberg is only the most prominent example.
But had he not left Disney, he would not have had Dreamworks, he would not have had Shrek, the number one movie this year. And conceivably, Disney might still have the animation franchise today that they had throughout the late ‘80‘s and early ‘90‘s. So.
GASPARINO: Yes, I mean, you can‘t drive away that many people - that many talented people from a company and expect to survive as the CEO, especially if your stock price is going down. And let‘s face it, this summer he was toast. He cut a great deal.
NORVILLE: Yes. How much, Charley, do you think the shareholder revolt - I mean, 43 percent of the shareholder votes were withheld?
NORVILLE: A huge vote of no confidence. He seemed to survive that.
Or did he really?
GASPARINO: Well, I mean, I don‘t know. I could tell you this. You have two shareholders on the board, right? Roy Disney and Mr. Gold are on the board. And they‘re activists. And you know, listen, Roy Disney‘s watching his fortune. I mean, this guy is what you‘d call lucky sperm kit. I mean, that‘s - you know, he‘s endowed with this fortune from Disney.
He‘s watching it evaporate under Mike Eisner.
So, of course he‘s going to be an advocate to get rid of him. And he‘s not going to stop obviously.
NORVILLE: Of course, it grew under Mike Eisner, too.
GASPARINO: Sure, absolutely.
NORVILLE: . to be totally fair.
We‘re going to take a short break. When we come back, we‘re going to look into some of the missteps that were made along the way during the reign of Michael Eisner. A lot of money was made, but some people say not enough has been made lately. Missed opportunities—more in a moment.
NORVILLE: We‘re talking about Michael Eisner, who has announced that he is stepping down as the head of Disney, stepping down in two years.
Back with me is “The Wall Street Journal‘s” Bruce Orwall, who broke the story this morning, “Newsweek” magazine‘s Charles Gasparino, and “Fortune” magazine‘s Mark Gunther.
Gentlemen, I want to look at some of the missed opportunities that some say Michael Eisner did not take advantage of.
Charley, what would you say is the one glaring misstep?
GASPARINO: Well, paying Mr. Ovitz $140 million in that severance package. That was a huge screw-up.
NORVILLE: That just never worked.
NORVILLE: He came in, he was supposed to be his right-hand man, but Mike Eisner doesn‘t really have right hand people as it turned out.
GASPARINO: That‘s right. And he‘s lucky, you know, he‘s - you know, the company is located in California, because if it was here in New York, you know, Mr. Spitzer would be going after him to get that money back.
NORVILLE: For the shareholders.
GASPARINO: Yes, for the shareholders.
NORVILLE: Let me go to you, Mark Gunther. What do you think the next misstep has been? Or if you want to keep talking about Mike Ovitz, that‘s fine, too.
GUNTHER: Well, the Ovitz thing, interesting on the timing. That someone is trying to get the money back. That‘s a lawsuit that‘s been filed on behalf of Disney shareholders. And it‘s going to trial very, very soon in the state of Delaware. So, again, this was the one moment when Michael Eisner was kind of not under fire. The fires are about to start coming.
I would say rather than any single misstep, it has been the challenge that he has felt in—that he‘s experienced in terms of collaborating with people. It‘s just been difficult for him to do that.
Now in fairness, he probably wasn‘t the superstar we made him out to be in the first 10 or 12 years. He had a fabulous team of executives, including Frank Wells around him now - around him then.
GUNTHER: And he‘s probably not. He‘s certainly not to blame for a lot of the problems of Disney in the last five or seven years. I mean, people stopped going to theme parks because of September 11th. And that was Osama bin Laden, not Michael Eisner.
NORVILLE: What about the departure, Mark, of Jeffrey Katzenberg and the $100 plus million that he ultimately received from the Disney Company?
GUNTHER: Yes, that was very badly handled. It allowed Jeffrey Katzenberg to go out and start a competitor to Disney that drove up the costs of animation, that essentially took away Disney‘s franchise as the leading place to turn for animation. I would argue that, you know, the loss of people like Katzenberg and others has been the biggest problem he‘s had to deal with.
NORVILLE: And Mark, did Katzenberg leave for personality reasons? Didn‘t it have to do with the way the animation business was set up and his share of the profits?
GUNTHER: Well, there are different stories. But I think the heart of it is that he wanted to become the president of the company to become Michael Eisner‘s number two, after Frank Wells‘ death. And Michael Eisner didn‘t feel he was ready for that job. And that‘s why he left.
NORVILLE: Yes, and if Katzenberg‘s departure allowed the Dreamworks Company to be created, and the new animation competitor, it seemed, did it not, Bruce, that the partnership with Pixar and Steve Jobs was just a deal of a lifetime?
ORWALL: It did. And it was. And it‘s been that for Disney. I think it‘s a testament to how much tension there was between Steve Jobs and Michael Eisner in the last few years, that Pixar left earlier this year in the manner that it did because the deal that Disney had put forward to them was incredibly lucrative. It couldn‘t be matched anywhere else. There‘s no way that Pixar could get the kind of arrangement that it was about to get from Disney.
And yet, Jobs pulled the plug in large part because he was tired of working with Mr. Eisner.
NORVILLE: So, it makes sense, does it not, that the shareholder revolt took place last March at the - or February at the annual meeting, Bruce?
ORWALL: You know, it makes sense to Roy Disney and to his followers. You know, I think the shareholder revolt that happened last year took place for a lot of reasons. It was a combination of factors that started with Roy Disney and Stanley Gold‘s resignation from the Disney board.
And then, basically everybody that had a problem with Michael Eisner stood up and started taking their whacks at him. Steve Jobs did. And then, the—of course, the coup de grace was when Comcast came in and made the unsolicited takeover in the middle of it all. And it created the set of circumstances that, you know, couldn‘t have been predicted and probably can‘t be replicated.
NORVILLE: Yes, and now add to it - I mean we know Hurricane Ivan is bearing down on Florida yet again. And you mentioned September 11th was clearly a horrible blow for the entertainment business in the theme parks.
But Charley, isn‘t the hurricane continuum also problematic for the company, just financially?
GASPARINO: Of course. I mean, listen, I mean, they make a lot of money from these theme parks. And they‘ve been losing money on these theme parks. Although one of Roy Disney‘s complaints has been that the theme parks aren‘t as good as they used to be. They‘re not as clean as they used to be. So, you know, they definitely—he‘s had some problems in that area.
NORVILLE: And Mark Gunther, what about the Harvey Weinstein issue?
GUNTHER: Again, that‘s a partnership that has not been handled well.
Although in fairness, Harvey is a very difficult guy to work with, by all accounts.
NORVILLE: I mean, that really is two bulls in a china closet, wouldn‘t you say?
GUNTHER: It‘s a tough one.
And again, the theme parks are still making money. But they are not -
· again, according to the critics—as well managed and as attractive.
They‘re very high priced now.
But I would have to say that Michael Eisner is not to blame for all of Disney‘s problems today. Nor was he—nor did he deserve as much credit as we gave him back then.
NORVILLE: And looking ahead, then, where does George Mitchell, the chairman of the Disney Company come into all of this? What would you say, Mark?
GUNTHER: Well, I would say that it‘s surprising that they made him the chairman of the company because he was on the board during a period of time when the board clearly failed to do its job. He also had a conflict of interest because his law firm had Disney as a client when he was on the board. But he is now one of a number of key people.
And again, to his credit, to Michael Eisner‘s credit, the board is much stronger and more independent than it was two or three or four years ago. And I think they will conduct a vigorous and open search. And I don‘t think Michael Eisner is going to pick his successor. I do think it‘s going to be chosen by the board.
NORVILLE: George Mitchell is known internationally as being something of a diplomat, Bruce. Will he be able to pull off those diplomatic skills needed to help find the right successor for the Disney Company?
ORWALL: Well, the skills that you use in government, of course, are different than the skills that you use in the private sector. It‘s going to be a challenge. He himself, you know, I think came to the job reluctantly, in an emergency situation last year, when they were forced with the likelihood that they were going to have to strip the chairman‘s title from Mr. Eisner in the midst of the shareholder revolt.
So, you know, it‘s definitely going to be a difficult process. He is, though, a consensus builder. That‘s his—I think that is the thing that he takes away from government. And so, he‘s going to be working with the 11 board members trying to find the right leader.
NORVILLE: Well, we will have to wait to see who that right leader is. But as Michael Eisner says, when he looks ahead to his future, he says I‘m going to Disney World.
Mark Gunther, Charley Gasparino, Bruce Orwall, thank you very much for being with us.
When we come back, was it that makes Mike Eisner tick? As one of America‘s most powerful corporate leaders, he‘s also, as you‘ve heard, one of the most controversial. We‘ll be back.
NORVILLE: We‘re talking about Michael Eisner‘s announcement today that he‘ll be stepping down as CEO of Disney when his contract expires in two years.
Joining me now is National Public Radio correspondent Kim Masters. She wrote the book “Keys to the Kingdom: The Rise of Michael Eisner and the Fall of Everybody Else.”
Kim, nice to see you. Thanks for being with us.
KIM MASTERS, NATIONAL PUBLIC RADIO: Thank you for having me.
NORVILLE: I know you were listening to the conversation just a moment ago. And over and again, we heard that Eisner has difficulty dealing with other strong personalities. And talented executives have left time and time again. Why is he such a prickly person?
MASTERS: Well, I mean, I think that he—without trying to play analyst, you know, he is the son of a very wealthy family in New York. And I think he was brought up very much to the manner. And he was—there were very high expectations for him.
In some ways, he didn‘t really meet them. I think he was destined for the Ivy League. His family had a big track record with Ivy League schools and he ended up going to a smaller Midwestern college.
And I think that Michael Eisner, you know, is someone who is somehow a very isolated person, very difficult to get to know. I—in writing my book, I interviewed people who knew him through college, people who he sort of described as friends, who honestly felt like they didn‘t know him particularly well. So, I think he‘s a very sort of isolated individual.
NORVILLE: Do you think that he ever felt that he lived up to the family expectations?
MASTERS: Well, you know, I hesitate to play therapist, as I said. I get the sense from the interviews I did, not - you know, his mother had passed away. I don‘t—I think this was a very demanding person. And I think that the expectations were incredibly high.
And Michael Eisner has a very sort of short attention span. He‘s not an academically gifted person. He was sent to a very elite private boarding school, which I think he just sort of struggled in. And I think he did in some ways—I have a feeling, also, just with the sort of New York upper crust family that he‘s from, the entertainment business wasn‘t quite the thing.
So, even with all of his success, I‘m not sure that that‘s the sort of thing that might have impressed Mrs. Eisner.
NORVILLE: But having said that, you also, in your book, describe him as incredibly charismatic. Back - you know, when he can be at some of these board meetings, they‘re literally practically hurling tomatoes at him. And he handles it with just grace and aplomb.
MASTERS: Yes, it was really striking at the shareholder meeting in March. I mean, this was a meeting where he‘s standing up in front of hundreds of shareholders who are calling out loud for him to be ousted from that job and cheering his opponents, Roy Disney and Stanley Gold, and clearly out for his - the end of him as the head of Disney.
And he was unbelievably unflappable. He does not get rattled by this stuff. I talked to someone who has been with him through all of this crisis with the shareholder revolt and the Comcast thing. The only thing that really rattled him at all apparently was the Comcast offer. And that‘s gone away for now.
So, he has nerves of steel. And he—I think internally, he is a very icy character, even though outwardly, yes, he is very charismatic.
NORVILLE: Well, and I guess this next question is sort of reflective of both the ice and the nerves of steel that occasionally get a little bit frayed. Because in the book, you quote him having commented about Jeffrey Katzenberg and saying I think I hate the little midget. I mean, obviously, there was no love lost, but that‘s a pretty low-down thing to say.
MASTERS: It was quite a thing to say. And it was even more remarkable that he would walk into a trial, in Jeffrey Katzenberg‘s lawsuit against Disney, knowing that he was going to be publicly asked about that comment. And you know, I think it‘s the kind of thing that goes into your obituary when you finally go to the reward. You know, he said this.
It was a very unbecoming thing for the chairman of a family company like the Walt Disney Company to say. And yet, you know, there‘s an imperiousness to Michael Eisner that is not to be overlooked, I mean, and is actually pretty salient. So, that—in a way, I think that‘s typical of the thought. He‘s not a guy who actually likes people that much, I don‘t think.
NORVILLE: So, who does he confide in? It doesn‘t sound like he‘s got any friends in Hollywood. Is it just the family dog and his wife, Jane?
MASTERS: He has some friends.
But he does have a sort of a mantra. Never have a friend in this town is something that he used to say. And I think he‘s really lived to that. He‘s not a guy that you see running around the town. For a man who‘s been out here in Hollywood, who came up through ABC, then Paramount and then through Disney, he‘s not like a Barry Diller, who‘s always out at every social occasion and has these lunches, and people feel that they know him.
He is a guy who sort of keeps to himself. He does not have—if you had to say who‘s his best friend in Hollywood, I don‘t think—I could sort of answer, but I wouldn‘t say it‘s a model of a friendship that you and I would consider to be a friendship.
NORVILLE: Yes, it would be more of an acquaintance maybe to you or me.
What is the second act, then, for Michael Eisner? He clearly doesn‘t need the money. If he sold every share of stock he had right now, he‘d have over $300 million in his pocket. And that is not counting what is already in the bank account. So, what does he do next?
MASTERS: Well, that‘s a really big mystery, because he hasn‘t said that he is leaving Disney. He has said that he is stepping down as chief executive of this company.
NORVILLE: Oh, but in a million years, can you see him staying there?
How awful for the poor person who has to succeed him?
MASTERS: I think that poor person in his mind might be Bob Iger, who‘s had to put up with this for the last several years already, so he‘s had good training.
I think that, in his mind, there is at least a possibility that things go well or well enough that they can‘t really find a good choice, which is not going to be easy. And you know, George Mitchell has said, I do not want to remain as chairman of this company. George Mitchell is in his 70s.
MASTERS: So, we‘re now looking for a chairman and a chief executive. And I talked to analysts on Wall Street today who certainly see a possibility that Michael Eisner imagines that he could be chairman of Disney, and Bob Iger—he has put fort Bob Iger as his candidate.
And if you think about it, putting Bob Iger in the chief executive job is the only way of sort of maintaining the status quo for the board and keeping Michael Eisner in a position as potentially sort of a chairman and an emeritus figure at Disney.
NORVILLE: Now, Bob Iger has said he‘d love to have the job. Some analysts, CSFB being one, have said Bob Iger would be a great pick for this position. But there are others who have said Iger‘s not the go-to guy. He‘s too linked to the things that have caused some of the shareholder issues in last several years. Bob Iger, he can‘t buy a break, basically, can he?
MASTERS: He can‘t, but to some degree, he‘s the victim of a deal that he has made in this job.
I think that Michael Eisner picked Bob Iger because, you know, having been through the debacle with Michael Ovitz, which ended so badly and continues to haunt the company.
MASTERS: . he was looking for a guy who sort of looked and smelled like a potential successor, but wasn‘t really taken seriously on Wall Street in that role. And all this time there‘s been this feeling like that, you know, Iger is fine and Iger is capable. But there‘s that ABC problem and he‘s not really the guy.
And I think Michael Eisner has hugely benefited from that perception, because if he had been taken seriously, I think Michael Eisner would have had a hard time keeping the job last March, when 45 percent of the shareholders voted to get rid of him.
So, having said that, is it now time for Bob Iger to kick in the afterburners and be Mr. CEO, impress them with what he can do and go be brilliant at Disney?
MASTERS: Can Bob Iger do that? I‘m sorry. I missed part of the question.
NORVILLE: Yes. Would this not be the time for Bob Iger to do that if now.
MASTERS: I think he‘d love to. Unfortunately, ABC is poised to go into a fall season that the pundits are not so sure is going to work. And if it turns out that ABC doesn‘t do well, he‘s going to have some explaining to do.
Well, Kim, this is all fascinating, and that‘s why we‘re going to ask you to stick around. When we come back, Kim will remain with us. And also, one of Michael Eisner‘s good friends, we‘re told, legendary Hollywood producer Robert Evans will join us to explain how Eisner has managed to stay in the picture for so long.
NORVILLE: He‘s been running the Magic Kingdom for years. Now, his reign is coming to an end. More on Disney‘s Michael Eisner in just a moment.
NORVILLE: Back with Kim Masters. She‘s the author of “Keys to the Kingdom: The Rise of Michael Eisner and the Fall of Everybody Else.” And joining our discussion from his home in Beverly Hills is legendary film producer Robert Evans, who has been a friend and business associate of Michael Eisner‘s for nearly 30 years.
He‘s now putting the finishing touches on his new book entitled “The Fat Lady Sang.” One of the chapters in the book is about Mike Eisner. And tonight, we‘ll be getting an exclusive first peek at what Robert Evans has written about Mr. Eisner.
Mr. Evans, you guys known each other 30 years. How did the two of you first meet?
ROBERT EVANS, FRIEND OF MICHAEL EISNER: We met when Michael became president of Paramount Pictures. Actually, we met on the first day he became president. And we‘ve been friends and co-workers now since—close to 30 years.
NORVILLE: Sorry. Go ahead.
EVANS: And I don‘t know anyone like him. He‘s singular in our industry, or, for that matter, in any industry. I‘ll tell you more about him later.
NORVILLE: What is it that makes him so different? Because we‘ve heard everything. We‘ve heard people describe him as such a tough taskmaster and so unwilling to be collaborative that it‘s been a problem for him. Is that the Mike Eisner that you know?
EVANS: No, I don‘t know. I know the Mike Eisner that‘s a visionary. I know a Mike Eisner that‘s so instinctive that he‘ll make decisions on the moment. I know a Mike Eisner that will fight, be tougher than anyone in the world. And yet, on the outside, he‘s like a kid.
That‘s a quality that he has that very few people have. And he is a kid. He really is a kid. He gets so enthusiastic about things, he‘ll stay with it day and night. But if he makes up his mind to do something, get out of his way. He‘ll do it.
NORVILLE: Go ahead.
EVANS: You know, when his partner, Frank Wells, was killed, it was a very sad thing at Disney. Strange, isn‘t it, that they never replaced him? And for the last 15 years, he‘s run it without his partner. And I think if the head of production quit, the head of production quit, the head of marketing quit, I don‘t know if they‘d be replaced either. I think Michael thinks he can do everything.
And by the way, I think he can do everything. It‘s just too big a company, possibly. But he is that bright, that incisive. You know, instinct is a strange thing. You can‘t buy it. You can‘t be taught it. You can‘t find it through the travels of a headhunter. You either have it or you don‘t. And no one has better instinct Michael Eisner.
EVANS: This is not hyperbole.
NORVILLE: Do you think his instincts, Mr. Evans, are as good today as they were, say, when you handed him that eight-page article from “Esquire” that ended up being the Debra Winger movie “Urban Cowboy”?
EVANS: Well, let me answer that.
I wrote a book called “The Kid Stays in the Picture.”
EVANS: And Simon & Schuster were going to publish it. And they paid me an enormous fee to write the book. Quite frankly, it was for all the wrong reasons and I didn‘t realize it.
About two weeks after I turned the book, the final manuscript in, I get a call from the head of Simon & Schuster and the chairman of the board of what was then called Paramount Industries. By the way, since then, management has changed. But at that time, Dick Snyder (ph) told me that they‘re not publishing my book. Two weeks earlier, he had told me that it‘s his gift to the company. That‘s how much he loved it.
The man on top of him, a guy named Marty Davis, was chairman of the Board of Paramount industries. And something must have happened in that week, that they may have both gone into the urinal, and Marty took his thumbs and put it down when it came to my name, because, from being their prized property to putting it on the shelf.
Did I understand it? Not at the beginning I didn‘t. And I said, well, I‘ll buy it back. Let me have it back. He says, no, we own it. Are you telling me that you‘re not going to let it be published? He said, that‘s right. We own it. Then it came back to me in a split moment that the only reason they paid so much money for my book.
NORVILLE: Was to keep you quiet.
EVANS: . was they never wanted it to come out. They never wanted that book to come out. They didn‘t want the history of Paramount told through my mouth.
NORVILLE: Let me let Ms. Master in here, too, Mr. Evans.
Kim, want to respond to that, that tale?
MASTERS: Well, it‘s not unlikely that they had—that Marty Davis, who ran Paramount, was a cold customer who actually threw Michael Eisner and Barry Diller out into the street in 1984, kicking off the beginning of this Disney dynasty that Michael Eisner headed.
And I think Michael Eisner actually—he has told me himself, back in the day when he was still speaking to me, that he‘s crazy about Bob Evans, and he was crazy about his book. And he actually sent it to me on tape. I think Bob Evans, who, as you point out, is a legend in Hollywood, truly amuses Michael Eisner. And he has genuine affection for him.
NORVILLE: And Mr. Evans, in your new book coming out, you were kind enough to share an excerpt for us. And I want to read it for the folks at home.
You said: “Under Howdy”—and your nickname for Mr. Eisner was Howdy Doody—“Under Howdy‘s ingenious, all-American facade breathes the single most competitive, cunning, calculating, cantankerous, creative visionary that this hybrid industry art form has ever dealt with. Eisner sees it on the screen before it is ever made.”
That is a gift, and not many people have that. Where does it come from in Mike Eisner, knowing it for 30 years as you?
EVANS: Where does it come from? Nobody knows.
It‘s called instinct. And you can‘t buy it. It‘s there. I‘ll give you an example. I wanted to make a picture called “Players.” It was about tennis. And he said, Bob, tennis pictures just don‘t work. People won‘t go to see a tennis picture. I said, I really want to make this picture. He said, Bob, you don‘t want to make it. I said, what happens if I get Wimbledon. He burst out laughing. He says, if you get Wimbledon, I‘ll make the picture. I said, write that down. I want you to sign it on a piece of paper. This was in the commissary. And he signed it.
Well, I got Wimbledon, and the picture didn‘t work. It failed.
EVANS: And he got Disney. What can I tell you? That‘s Michael Eisner.
How about, I gave him an eight-page treatment on something called “Urban Cowboy.” It was written up in “Esquire” magazine by Aaron Latham. He reads the eight pages, says, make that movie. I don‘t care who is in it. That music is going to work. That‘s the coming thing. You can spend up to $12 million, which was a lot of money at that time.
EVANS: But I don‘t care if you use all unknowns, but make that picture and make it quick. Don‘t go in through layers and layers of executives upon executives upon executives upon executives. Michael Eisner, make it.
Conversely, I brought him a picture called “Inside Moves.” It‘s a wonderful book. And Dick Donner was going to direct it and Dustin Hoffman was going to star in it. And basketball was his background.
And he said, Bob, basketball pictures don‘t work. I‘m telling you that. I said, but this is not about basketball, Michael. It‘s like “One Flew Over the Cuckoo‘s Nest.” He says, it‘s still about basketball. So, I go to see Dustin, and Dustin wanted to make it so badly, he says, you tell Eisner I‘ll work for nothing, I want to make that picture so badly.
So, I feel great. I walk into Eisner‘s office. I said, Michael, I have Dustin Hoffman working for scale. I have Dick Donner working for scale. We can make this picture for under $5 million. He says, I still don‘t want it.
EVANS: So, how can you turn it down? He says, basketball just doesn‘t sell.
NORVILLE: Well, we‘re going to leave it on that note. Clearly, the sports movies.
EVANS: No, I‘d like to go further, if I may.
NORVILLE: Well, you‘re going to have to do it in 10 seconds, unfortunately. You know how that works.
EVANS: All right, I will. Dustin lost respect for me as a producer. Dick Donner made it and the picture didn‘t work. That‘s how smart Eisner is, OK?
NORVILLE: Eisner got it right again.
Robert Evans, you‘re a dear to be on with us. We appreciate it. We look forward to seeing your new book.
Kim Masters, thanks, as well.
We‘re going to take a short break. More with our guests in just a moment.
NORVILLE: Back now talking about outgoing Disney CEO Michael Eisner.
Our guests are Kim Masters and Robert Evans.
Ms. Masters, just a moment ago, Mr. Evans was talking about the rapid-fire way that Mike Eisner could make decisions about movies. Was that always a good thing for him?
MASTERS: You know, I think that his impulsivity, as Mr. Evans says, is in a way a kind of plus, that instinct.
But I think, if you look at his career, he always had people—up until 1994, when his No. 2 man, Frank Wells, was killed, he had people around him who could really check those instincts, Barry Diller and Frank Wells at Disney. And I think what happens is, since 1994, you‘ve seen Michael Eisner without those impulses checked, and you‘ve seen some very short-term decisions that have backfired and been very problematic for the company.
NORVILLE: And Robert Evans, did Mike Eisner ever feel that some of those decisions had backfired? Did he ever talk with you about his distress over maybe the Ovitz pairing not working the way they all envisioned?
EVANS: First of all, I don‘t think it was a distress. I think it was planned. But that‘s my own opinion.
I can tell you, though, he had instincts in 1994 to take my book, buy it, and wanting to make it the biggest book of the year, and overrode the publisher, who was a man named Bob Miller (ph). And unfortunately, he had a quadruple bypass after that. And when the king is lying with a triple bypass, his underlings aren‘t particularly sympathetic to what he likes.
And he came back. You must remember, when Michael Eisner came to Disney, it was a white elephants and he made it the Hope Diamond. And I worked at Disney. Do you know how square they were then? That the editors had to wear three-piece suits.
EVANS: Now, that‘s at a movie studio.
EVANS: That‘s how backwards they were. And I must tell you, they didn‘t take kindly to people of Michael Eisner‘s persuasion at that time either.
NORVILLE: I know you saw Mike Eisner over the summer. Did he talk to you about how the whole shareholder thing had gone down and how he had been so publicly criticized?
EVANS: Not at all. You know what he reminded me of? The opposite.
He reminded me of a basketball coach in high school.
NORVILLE: How so?
EVANS: He‘s that kind of—he‘s a kid. Now, I‘m not saying he‘s that way with his executives in the room. But when he makes a decision, he lives by it.
Now, he‘s a boss. And you know, there are very few bosses around. And when I look around at all the studios, the one man I think who has a good chance of being Michael Eisner is Tom Preston (ph), because he‘s a kid, too. And luckily, he‘s at Paramount now. But he‘s a dynamo. He‘s the closest resemblance that I can think to Michael Eisner.
EVANS: That is, if there is anyone like Eisner.
NORVILLE: Kim Masters, when you look at Mike Eisner and you hear Robert Evans speak so positively about a long history together, while you had said before he may not have personal friends in the way that most people would think, does he have a great professional network of people who think well of him and would endorse in whatever that next phase of his public career, if he has one, will be?
MASTERS: I would have to say not in this community. I think Mr.
Evans and a couple of other people are friendly with him.
But you know, true friendship—you know, I think in this town, Michael Eisner has just not endeared himself to a wide range of people. It has not been his interest to do so, and he hasn‘t done it.
NORVILLE: Mr. Evans, do you want to respond?
EVANS: Kim is absolutely right. In one way, Kim is absolutely right.
In another way, this is an industry where 95 percent of the people are unemployed, and five percent are employed. So, you don‘t become popular by saying no to many people.
EVANS: And especially when you‘re there that long.
Michael isn‘t looking—and, by the way, I‘m not a great social friend of him—of his. I‘d like to be. I‘m not. But I‘ll tell you this. I have great respect for him.
NORVILLE: I‘ve got to let that be the last word. I‘ve got to let that be the last word. Unfortunately, we‘ve got to go to a commercial yet again, pay the bills.
EVANS: All right.
NORVILLE: Robert Evans, thank you for being with us from Beverly Hills.
Kim Masters, our thanks to you as well for your perspective.
When we come back, a spaceship crashes to Earth, but not everything was lost. We‘ll explain in a moment.
NORVILLE: This week‘s “American Moment” proves that, just when you think all hope is lost, there can be some light at the end of the tunnel, or, in this case, at the end of a long space journey.
On Wednesday, that unmanned Genesis capsule plummeted from space when its parachute failed to open. Its reentry into the Earth‘s atmosphere was captured on camera. And it was pretty amazing watching it. Then it crashed into the Utah desert. Genesis was carrying solar atoms collected from the sun. And when it slammed into the ground at nearly 200 miles an hour, the capsule cracked open.
Guess what? Those atoms could explain how the sun was formed 4.5 billion years ago. And NASA scientists figured that the disc containing those items had simply sustained too much damage of being of any use. But after combing through the wreckage with flashlights and mirrors, NASA says they were surprised to find that some of the materials were intact and that many of the mission‘s goals will be fulfilled.
The capsule was damaged so badly, though, it could take months to collect all the solar atoms, but some will be retrieved and all is not lost, some good news in what has been a pretty lousy week for NASA. And that is this week‘s “American moment.”
You can send us your ideas and comments to us at email@example.com. We‘ve got some of your e-mails posted on our Web page at firstname.lastname@example.org. That‘s also where you can sign up for our newsletter.
That‘s our program for tonight. Thank you so much for watching.
All this weekend, do stay tuned to MSNBC for complete coverage of Hurricane Ivan. Coming up next, Joe Scarborough with “SCARBOROUGH COUNTRY.”
Thanks for watching. Have a great weekend.
Copy: Content and programming copyright 2004 MSNBC. ALL RIGHTS RESERVED. Transcription Copyright 2004 FDCH e-Media, Inc. (f/k/a/ Federal Document Clearing House Inc., eMediaMillWorks, Inc.), ALL RIGHTS RESERVED. No license is granted to the user of this material other than for research. User may not reproduce or redistribute the material except for user‘s personal or internal use and, in such case, only one copy may be printed, nor shall user use any material for commercial purposes or in any fashion that may infringe upon MSNBC and FDCH e-Media, Inc.‘s copyright or other proprietary rights or interests in the material. This is not a legal transcript for purposes of litigation.