“Insanity.” That’s how former Disney (NYSE: DIS) CEO Michael Eisner described the writers’ strike during an interview with Neil Cavuto at the Media & Money Conference. Eisner’s current role is internet entrepreneur and investor through his investment firm The Tornante Company. Eisner, seldom at a loss for words, explained his business strategy and provided opinions on a variety of topics:
– Writer’s strike: “Insanity.” “There’s all of this rhetoric by the media companies about this ‘great new digital business’, which is a small, growing business that will one day be dominant (but it isn’t, yet there’s no money there yet.” Because all of the entertainment folks are talking up digital, the writers assume there’s a lot of money there. Take Prom Queen: “We made history, but we didn’t make money. … I’m doing it because I think it’s fun; I think it’s the future. … For a writer to give up today’s money for a piece in three years is stupid.” The studios can’t give in because there’s nothing to give. “The studios deserve what they’re getting, because they’ve been announcing how great it is.” But it’s only great in theory. “They made deals with Steve Jobs, who takes them to the cleaners. Who’s making money? Apple.” Entertainment executives can’t admit that they’re not making money. Writers should be striking in Cupertino. (Hard not to see this as a slam on Disney successor Bob Iger, who cut the first video deal with iTunes.)
– Broader economy: “There are some horrible signs, everyone knows what they are. Leverage. The pain is only beginning.”
– Tornante’s Topps acquisition: Goal is to take the Topps brand, which produces a Pavlovian response in the American male, into the digital age. “Topps is about hero worship for males.”
– Distribution: Eventually broadband will be the major mode of distribution, but that does not mean that other modes of distribution forms will disappear. “One plus one equals 2.5 or 3″. The business expands” The previous forms of distribution may get smaller and will realign. Research says that young people won’t read a newspaper, but the same research indicates that they don’t care about the source. “Right now, the internet is a democracy turning into an oligarchy… it is out of control, where the computer is the king and the human brain is discounted, … Any single brand in this room is more interesting and more complex than all of the computers in this room.” Gave an example of the Golden Girls translated into French. “Estelle *Getty*’s ‘I have to take a pee’ is cute” Translated into French, it’s ‘I have to take a piss.’ Not cute.” Humans are needed to appreciate that subtlety.
– Professional content vs. user gen:“The fact of the matter is that it’s not easy to write, direct and cast. … How many times can you watch a kid get hit in the groin? YouTube can be indiscriminate about how bad it can be.” There’s still a need for big-pocketed people to find and fund talent. Big companies aren’t going away. Rupert et al aren’t stupid troglodytes. “You’re going to need someone to bring it together. Everybody can’t do it, it is about talent.”