Why Is Dick Cook Leaving Disney?
Even Hollywood insiders were shocked by the news late Friday that Dick Cook, the Walt Disney veteran and beloved chairman of Walt Disney Studios is stepping down immediately. Just last week at Disney's big expo, D23, I spoke to Cook about his plans to revive Disney's studio and innovate with 3-D technology in the home. The fact that Disney's studio has gone through a rough patch this year is responsible for this surprise news. The studio lost $12 million in the company's most recent quarter, down from a $97 million profit in the year-ago period and CEO Bob Iger has singled out the studio as a drag on company results.
What now for Disney ? Disney bought Pixar for $7.4 billion in 2006, earlier this year made a deal with Steven Spielberg and Stacey Snider's DreamWorks to distribute their films, and just last month acquired Marvel Entertainment for $4 billion. Industry insiders tell me—and this makes sense—that Disney could be moving towards a model of dramatically cutting back its own creative development. Instead Disney would focus entirely on distributing films from Pixar, DreamWorks, Marvel Entertainment, and Jerry Bruckheimer films, and perhaps also Disney Animation. DreamWorks plans to release six movies a year, Pixar generally produces one a year, Marvel is shooting for two a year, and if Bruckheimer releases two a year: that alone is 11 films for Disney to release annually.
The idea would be that Disney would reserve its powerful "Walt Disney Pictures" brand for a select few theatrical products (cutting its production overhead way back) and let its crackerjack marketing and worldwide distribution pipeline deploy the DreamWorks, Marvel, Pixar brands. Some of my Hollywood sources are speculating that Mark Zoradi, currently president of Walt Disney Studios Motion Pictures Group, which oversees marketing and distribution, would be a natural fit to take over the studio if it does indeed shift away from production.
Despite the studio's under-performance, Cook's departure is still such a surprise because he was so well-liked by key producers and big talent in the industry. Executives at Disney, DreamWorks and Marvel all say they were surprised by the news. Johnny Depp is quoted in the Los Angeles Times questioning whether he'll want to continue playing his key role in "Pirates of the Carribean" sequels without Cook heading the studio. Steven Spielberg and Stacy Snider are both huge fans of Cook and that relationship was key to establishing their distribution deal with Disney. (Rumors that Snider would go take over Disney's studio are easily dispelled as Snider is in a contract at Dreamworks, and her leadership is also key to Reliance's financing deal with the studio).
Why push Cook out now? (And it does appear that he was pushed out). It's been a rough summer for Disney's studio performance and it appears that "Surrogates," which will be released next week could be a big disappointment. But perhaps more importantly, Disney's fiscal year ends on Sept. 30. Some have speculated that the company wants to take the hit of paying out Cook's contract in a lump sum this quarter, when earnings from the studio are sure to still be weak, and flush out that salary hit before starting a new fiscal year.
- Click Here for After-Hours Disney Quotes
Questions? Comments? MediaMoney@cnbc.com