×

"Fast Money" Speaks with CNBC Host and Former Disney CEO and Now Founder of the Tornante Company, Michael Eisner

WHEN: Thursday, February 7th, 5PM ET
WHERE: "Fast Money"

The following is the unofficial transcript of a CNBC interview with Michael Eisner, Former Disney CEO and now founder of The Tornante Company and host of CNBC's "Conversations with Michael Eisner," on "Fast Money" today at 5:30PM ET. All references must be sourced to CNBC's "Fast Money."

In the interview with CNBC's "Fast Money," Michael Eisner tells host Dylan Ratigan and the "Fast Money" traders that a deal has been made to end the writer's strike.

DYLAN RATIGAN: WE WELCOME ONCE AGAIN MEDIA MOGUL EXTRAORDINARE, FRIEND OF THE SHOW, RATHER TALL MAN, MICHAEL EISNER.THE MEDIA NAMES IN GENERAL ALL HAVE PUT UP RATHER LOVELY NUMBERS AND THE STOCKS IN GENERAL HAVE PERFORMED WELL THIS WEEK. CURIOUS, HOW IT IS THAT A MEDIA COMPANY PERFORMS IN GENERAL IN AN ECONOMIC SLOWDOWN? IT'S PECULIAR TO SEE STRENGTH GOING INTO AN ECONOMIC SLOWDOWN FROM A MEDIA COMPANY?

MICHAEL EISNER: I THINK MOST PEOPLE KNOW MEDIA COMPANIES ARE RESISTANT TO SLOWDOWNS. DISNEY AND TIME WARNER, ONLY 20% OF THEIR EARNINGS COME FROM ADVERTISING AND THE MULTIPLE SOURCES FROM THEIR CABLE, EVEN NEWS CORP AND VIACOM ONLY 40% THEY'RE WELL-RUN COMPANIES. DISNEY, I THINK, IS A PARTICULARLY WELL-RUN COMPANY. RUPERT MURDOCH PUT OUT A SUCCINCT PLAN FOR THE FUTURE. IF YOU LOOK AT THE INTRINSIC VALUE OF THESE COMPANIES OVER A LONG PERIOD OF TIME BROUGHT BACK TO TODAY, ONLY 10% IS THE FIRST YEAR. I ACTUALLY THINK THE RECESSION HAS ALREADY BEEN BUILT INTO THE MEDIA COMPANIES' STOCKS. I THINK THE MEDIA STOCKS ARE UNDERVALUED AND MOST OF THE COMPANIES ARE VERY WELL RUN. AND WILL DO WELL IN THIS KIND OF ENVIRONMENT.

RATIGAN: WE HAVE A VALUE INVESTOR IN THE ROOM, KAREN. HOW DO YOU LOOK AT THE MEDIA STOCKS AS A VALUE PROPOSITION RIGHT NOW?

FINERMAN: IT WAS VERY INTERESTING WHAT YOU JUST SAID. WHEN YOU'RE LOOKING AT A DISCOUNTED CASH FLOW MODEL AND YOU THINK 10% OF THE VALUE IS 08. IS THAT PARTICULAR IN MEDIA COMPANIES OR IN GENERAL.

EISNER: I THINK ALL COMPANIES ARE DONE THAT WAY. IF YOU LOOK AT DISNEY OR TIME WARNER, THESE BRANDS SUSTAIN THEMSELVES. DISNEY IS CROSS PLATFORMED IN THEIR EARNINGS CALLS. THEY TALK ABOUT THE HANNAH MONTANA AND THE MICKEY AND THE WINNIE THE POOHS. THEIR SYNDICATION VALUES GOES FOR A LONG PERIOD OF TIME. THESE GO OVER A LONG PERIOD OF TIME OR A SESSION WILL LAST A YEAR, MAYBE TWO YEARS. THOSE INTRINSIC VALUES GO OUT OVER 7, 8, 10 YEARS BROUGHT BACK TO TODAY. YOU CAN'T SAY THE SKY IS FALLING UNLESS YOU'RE MAKING "CHICKEN LITTLE" AS A MOVE.

RATIGAN: WHERE DO WE STAND ON THE WRITERS STRIKE?

EISNER: IT'S OVER. THEY MADE THE DEAL. THEY SHOOK HANDS ON THE DEAL..IT'S GOING ON SATURDAY TO THE WRITERS IN GENERAL.

IT'S POSSIBLE THAT THE CONTITUENCY OF WRITERS -- I DON'T THINK IT'S POSSIBLE.IT'S IMPOSSIBLE TO TURN IT DOWN. DEAL HAS BEEN MADE, AND THEY'LL BE BACK TO WORK.

MACKE: THIS IS RECENTLY LARGE BREAKING NEWS, BUT AS FAR AS THE DEAL FOR THE WRITERS STRIKE IS OVERMENT.

EISNER: I KNOW IT'S OVER. NOW, I DON'T HAVE A JOB, SO I HAVE NOTHING TO LOSE.

MACKE: WE DON'T HAVE WRITERS.

EISNER: I HAVE SOME FRIENDS IN CERTAIN PLACES. I BELIEVE THAT THERE WAS A HANDSHAKE LAST FRIDAY. I BELIEVE IT'S GOING DAY AFTER TOMORROW TO THE WRITERS THEMSELF. IT'S POSSIBLE THEM TURN IT DOWN. IT WOULD BE INSANE. IT'S UNLIKELY THEY WILL TURN IT DOWN THEY WILL BE BACK TO WORK QUICKLY.

RATIGAN: WHAT ARE THE IMPLICATIONS OF DEAL AS YOU UNDERSTAND IT.

EISNER: BECAUSE THE COMPANY THAT IS OWN THE CONTENT ARE SO LARGE LARGE, YES, MOST OF THESE COMPANIES WILL HAVE TEENY WRITEDOWNS AND SOME OF THE SYNDICATED VALUE WERE DELAYED BEING PRODUCED. THEY WILL BE DELAYED BACK TO INTRINSIC VALUE OVER THE LONG TERM. I DON'T THINK IT WILL HURT THESE COMPANIES. IT WILL HURT THE WRITERS, IT WILL HURT SHORT-TERM EARNINGS SCHOOLS, INSURANCE, HOUSE MORTGAGE. IT'S NOT OF NO CONSEQUENCE. IT'S DISRUPTIVE, BUT I DON'T THINK IT'S EARTH-SHATTERING.

RATIGAN: LET ME ASK YOU ANOTHER QUESTION. A LOT OF WRITERS HAVE THEIR DEALS TORN UP AFTER THEY WENT ON STRIKE. THESE WERE MILLION DOLLAR PEOPLE, WHO HAD SUBSTANTIAL INCOMES IN LOS ANGELES THAT WATCHED EVERYTHING TORN UP. THERE'S NO MORE DEAL. ONCE A NEW DEAL IS CREATED, WHERE DOES THE BALANCE OF THE WRITING COMMUNITY STAND IN TIMING OF RE-ENTERING THE WORK FORCE.

EISNER: I SAID AND I GOT IN TROUBLE I THOUGHT IT WAS ILL-TIMED STRIKE. IF THERE WAS A STRIKE, IT SHOULD HAVE BEEN THREE YEARS FROM NOW WHEN YOU NEW THE DEFINITION OF THE ONLINE BUSINESS AND WHERE THE REVENUES WERE COMING FROM. A LOT OF WRITERS LOST THEIR DEALS AND WILL NOT BE REINSTATED -- ONE OF THE REASONS THEY DON'T HAVE THIS ECONOMIC PROBLEM IS THEY CUT BACK ON BIG DEALS. IT'S UNFORTUNATE. PEOPLE WILL RECOVER. THE ONE THING THAT IS GREAT IS TALENT WILL WIN OUT. FOR THE SHORT-TERM, I THINK IT WAS A MISTAKE.

RATIGAN: YOU BELIEVE THREE YEARS FROM WE WILL KNOW A MUCH BETTER HANDLE ON WHAT CONTENT IS WORTH IN A DIGITAL ENVIRONMENT.

EISNER: I THINK, FOR INSTANCE, MORE MOVIES WILL BE VIEWED ONLINE THAT PAY-PER-VIEW AND CABLE. I THINK THE ONLINE IS REAL, BUT RIGHT NOW THE ADVERTISERS HAVENT QUITE FOUND -- IT WILL TAKE TWO OR THREE YEARS BEFORE IT BECOMES THE BUSINESS THAT AFFECTS WRITERS.

RATIGAN: THANK YOU FOR BREAKING THE NEWS HERE.

EISNER: I'M NOT BREAKING THE NEWS.

RATIGAN: IT'S JUST A GUY TALKING.

EISNER: ARE WE ON THE AIR? OH. I WAS GIVING YOU A RUMOR. I HEAR IT'S OVER. I'M GOING TO BE IN BAD SHAPE IF IT'S NOT.

RATIGAN: MICHAEL EISNER, THE RESUME TOO LONG TO COUNT. THE BIG NEWS, THE WRITERS STRIKE ACCORDING TO PEOPLE FAMILIAR WITH MICHAEL EISNER OVER. "POPS AND DROPS" HERE RIGHT AFTER THIS.




About CNBC:
CNBC is the recognized world leader in business news, providing real-time financial market coverage and business information to more than 340 million homes worldwide, including more than 95 million households in the United States and Canada. The network's Business Day programming (weekdays from 5:00 a.m.-7:00 p.m. ET) is produced at CNBC's headquarters in Englewood Cliffs, N.J., and also includes reports from CNBC news bureaus worldwide. Additionally, CNBC viewers can manage their individual investment portfolios and gain additional in-depth information from on-air reports by accessing http://www.cnbc.com.

Members of the media can receive more information about CNBC and its programming on the NBC Universal Media Village Web site at http://nbcumv.com/cnbc/.