Disney CEO Suggests He May Dump ABC and Other Networks: ‘May Not Be Core to Disney’

FABER Well you re ░░░░░░░░ through all the things ░░░░░░░░ we want to talk ░░░░░░░░ in the time that ░░░░░░░░ have here but I ░░░░░░░░ just to sort of ░░░░░░░░ up why you re ░░░░░░░░ I mean you said ░░░░░░░░ a memo to employees ░░░░░░░░ ve made important and ░░░░░░░░ difficult decisions You re ░░░░░░░░ of what you you ░░░░░░░░ accomplished But there s ░░░░░░░░ to accomplish before this ░░░░░░░░ work is complete So ░░░░░░░░ again what is the ░░░░░░░░ s transformative here And ░░░░░░░░ is the work that ░░░░░░░░ going to take another ░░░░░░░░ two years or even ░░░░░░░░ even after you do ░░░░░░░░ that needs to get ░░░░░░░░ IGER Well the transformative ░░░░░░░░ of course is making ░░░░░░░░ that our cost structure ░░░░░░░░ the the economic realities ░░░░░░░░ the business And that ░░░░░░░░ disruption Transformative work is ░░░░░░░░ with businesses that are ░░░░░░░░ growth businesses and what ░░░░░░░░ do about them and ░░░░░░░░ the linear business which ░░░░░░░░ are expansive in our ░░░░░░░░ about and we re ░░░░░░░░ to look expansively about ░░░░░░░░ there because clearly it ░░░░░░░░ a business that is ░░░░░░░░ to continue to struggle ░░░░░░░░ Well let s stop ░░░░░░░░ for a second and ░░░░░░░░ just and let me ░░░░░░░░ you about it We ░░░░░░░░ talking I guess ABC ░░░░░░░░ network the stations but ░░░░░░░░ the cable networks as ░░░░░░░░ IGER Yes Correct FABER ░░░░░░░░ NatGeo Is it possible ░░░░░░░░ would look to sell ░░░░░░░░ IGER We re going ░░░░░░░░ be expansive I think ░░░░░░░░ can you can interpret ░░░░░░░░ that word means You ░░░░░░░░ we re just getting ░░░░░░░░ that work But we ░░░░░░░░ to be open minded ░░░░░░░░ objective about the future ░░░░░░░░ those businesses Yes FABER ░░░░░░░░ that they re not ░░░░░░░░ to Disney IGER That ░░░░░░░░ may not be core ░░░░░░░░ Disney Yeah Now there ░░░░░░░░ clearly creativity and content ░░░░░░░░ they create that and ░░░░░░░░ s core to Disney ░░░░░░░░ the distribution model the ░░░░░░░░ model it forms the ░░░░░░░░ of that business and ░░░░░░░░ has delivered great profits ░░░░░░░░ the years is definitely ░░░░░░░░ And we have to ░░░░░░░░ and and we have ░░░░░░░░ call it like it ░░░░░░░░ And that s part ░░░░░░░░ the transformative work we ░░░░░░░░ doing FABER Right Well ░░░░░░░░ ve been having this ░░░░░░░░ for a very long ░░░░░░░░ now IGER Well I ░░░░░░░░ what I m saying ░░░░░░░░ it s FABER in ░░░░░░░░ of the erosion of ░░░░░░░░ linear business IGER Yeah ░░░░░░░░ and now it s ░░░░░░░░ of closer to obsolescence ░░░░░░░░ Well I you know ░░░░░░░░ I said when I ░░░░░░░░ back one of the ░░░░░░░░ I discovered was that ░░░░░░░░ disruptive forces that have ░░░░░░░░ preying on that business ░░░░░░░░ a while are greater ░░░░░░░░ I thought And so ░░░░░░░░ s it s eye ░░░░░░░░ you know There s ░░░░░░░░ reality to it that ░░░░░░░░ have to come to ░░░░░░░░ with and we have ░░░░░░░░ come to grips with ░░░░░░░░ now And by the ░░░░░░░░ another business that is ░░░░░░░░ has benefited from that ░░░░░░░░ model is ESPN but ░░░░░░░░ we re looking at ░░░░░░░░ differently FABER I want ░░░░░░░░ get to ESPN obviously ░░░░░░░░ just to understand so ░░░░░░░░ don t know what ░░░░░░░░ re going to do ░░░░░░░░ it comes to these ░░░░░░░░ the linear businesses But ░░░░░░░░ would be open to ░░░░░░░░ that would perhaps separate ░░░░░░░░ or change the structure ░░░░░░░░ some way as to ░░░░░░░░ to Disney crosstalk IGER ░░░░░░░░ I ll let I ░░░░░░░░ you speculate I m ░░░░░░░░ going to I m ░░░░░░░░ gonna do any speculating ░░░░░░░░ except to say that ░░░░░░░░ re very objective about ░░░░░░░░ future as part of ░░░░░░░░ asset base FABER All ░░░░░░░░ Well then when we ░░░░░░░░ about the other major ░░░░░░░░ of course dealing with ░░░░░░░░ the cable ecosystem it ░░░░░░░░ ESPN And so what ░░░░░░░░ the expectations there Since ░░░░░░░░ ve been back I ░░░░░░░░ you ve been thinking ░░░░░░░░ lot about it IGER ░░░░░░░░ have FABER What is ░░░░░░░░ conclusion in terms of ░░░░░░░░ future of that A ░░░░░░░░ of people have been ░░░░░░░░ much focused on when ░░░░░░░░ you going to take ░░░░░░░░ to a fully streaming ░░░░░░░░ and move it essentially ░░░░░░░░ from IGER Yeah FABER ░░░░░░░░ cable ecosystem But is ░░░░░░░░ more that you re ░░░░░░░░ about IGER Well let ░░░░░░░░ talk about sports first ░░░░░░░░ OK IGER which obviously ░░░░░░░░ s ESPN If you ░░░░░░░░ at today s media ░░░░░░░░ sports stands very very ░░░░░░░░ in terms of its ░░░░░░░░ to convene millions and ░░░░░░░░ of people all at ░░░░░░░░ There s almost a ░░░░░░░░ that that occurs It ░░░░░░░░ an advertiser s dream ░░░░░░░░ s a great demographic ░░░░░░░░ It lends itself to ░░░░░░░░ in many ways both ░░░░░░░░ terms of coverage distribution ░░░░░░░░ consumption And our position ░░░░░░░░ that business is very ░░░░░░░░ We have a great ░░░░░░░░ we ve had a ░░░░░░░░ business and we want ░░░░░░░░ stay in that business ░░░░░░░░ said we re going ░░░░░░░░ be open minded there ░░░░░░░░ not necessarily about spinning ░░░░░░░░ off but about looking ░░░░░░░░ strategic partners that could ░░░░░░░░ help us with distribution ░░░░░░░░ content But we want ░░░░░░░░ stay in the sports ░░░░░░░░ FABER What would a ░░░░░░░░ partner look like with ░░░░░░░░ or content then for ░░░░░░░░ IGER Well I think ░░░░░░░░ could again I m ░░░░░░░░ m I m I ░░░░░░░░ not going to get ░░░░░░░░ detailed about it but ░░░░░░░░ re bullish about sports ░░░░░░░░ general as a media ░░░░░░░░ There is an inevitability ░░░░░░░░ the way you raised ░░░░░░░░ to taking ESPN direct ░░░░░░░░ consumer FABER Yeah IGER ░░░░░░░░ haven t said when ░░░░░░░░ we do know that ░░░░░░░░ will happen FABER Is ░░░░░░░░ sooner than you had ░░░░░░░░ let s even say ░░░░░░░░ months ago IGER No ░░░░░░░░ think I m much ░░░░░░░░ certain about when but ░░░░░░░░ prepared to say when ░░░░░░░░ is I won t ░░░░░░░░ whether it s sooner ░░░░░░░░ not but I m ░░░░░░░░ m enthusiastic about it ░░░░░░░░ Why are you enthusiastic ░░░░░░░░ it IGER Because I ░░░░░░░░ sports again I think ░░░░░░░░ stands tall in a ░░░░░░░░ of tremendous choice and ░░░░░░░░ in in many respects ░░░░░░░░ advertisers dream and a ░░░░░░░░ dream I mean it ░░░░░░░░ a very very attractive ░░░░░░░░ is a very very ░░░░░░░░ medium And we have ░░░░░░░░ unique position and we ░░░░░░░░ that we should stay ░░░░░░░░ it But we d ░░░░░░░░ to FABER You re ░░░░░░░░ more and more money ░░░░░░░░ do that I mean ░░░░░░░░ keep the NBA to ░░░░░░░░ the NFL essentially renting ░░░░░░░░ content that keeps this ░░░░░░░░ alive I mean is ░░░░░░░░ the best use for ░░░░░░░░ capital IGER Well I ░░░░░░░░ a lot has been ░░░░░░░░ about renting versus owning ░░░░░░░░ if if you can ░░░░░░░░ it and and continue ░░░░░░░░ be profitable from renting ░░░░░░░░ which we have been ░░░░░░░░ we believe we will ░░░░░░░░ to be then there ░░░░░░░░ real value in staying ░░░░░░░░ it We re we ░░░░░░░░ we have great relationships ░░░░░░░░ Major League Baseball and ░░░░░░░░ the National Hockey League ░░░░░░░░ various college conferences and ░░░░░░░░ course the NFL and ░░░░░░░░ NBA And and it ░░░░░░░░ not just about the ░░░░░░░░ sports coverage of those ░░░░░░░░ those teams it s ░░░░░░░░ about all the shoulder ░░░░░░░░ that throws off on ░░░░░░░░ and what you can ░░░░░░░░ with it in a ░░░░░░░░ world You know as ░░░░░░░░ direct to consumer proposition ░░░░░░░░ talked about it being ░░░░░░░░ friendly FABER Yeah IGER ░░░░░░░░ a way There s ░░░░░░░░ much more that can ░░░░░░░░ done with it in ░░░░░░░░ of the way it ░░░░░░░░ distributed the way it ░░░░░░░░ consumed It s interesting ░░░░░░░░ thinking about the Apple ░░░░░░░░ of a few weeks ░░░░░░░░ and what the possibilities ░░░░░░░░ you know that that ░░░░░░░░ lends itself to in ░░░░░░░░ of sports FABER Right ░░░░░░░░ So I think I ░░░░░░░░ it s a business ░░░░░░░░ you know we want ░░░░░░░░ stay in we re ░░░░░░░░ because it has been ░░░░░░░░ FABER But what would ░░░░░░░░ the advantage of having ░░░░░░░░ strategic partner then What ░░░░░░░░ mean IGER Well it ░░░░░░░░ be it could be ░░░░░░░░ variety of things FABER ░░░░░░░░ it be a joint ░░░░░░░░ IGER It could be ░░░░░░░░ Could it be somebody ░░░░░░░░ an ownership stake I ░░░░░░░░ IGER Possibly yeah Everything ░░░░░░░░ on the table FABER ░░░░░░░░ why would you do ░░░░░░░░ I guess I m ░░░░░░░░ to understand IGER Well ░░░░░░░░ of it crosstalk FABER ░░░░░░░░ you would you already ░░░░░░░░ a 20 percent owner ░░░░░░░░ in Hearst IGER if ░░░░░░░░ come to the if ░░░░░░░░ come table FABER Yeah ░░░░░░░░ with value whether it ░░░░░░░░ whether it s content ░░░░░░░░ whether it s distribution ░░░░░░░░ whether it s capital ░░░░░░░░ it just helps derisk ░░░░░░░░ business to some extent ░░░░░░░░ that s wouldn t ░░░░░░░░ the primary driver But ░░░░░░░░ they come to the ░░░░░░░░ with value that enables ░░░░░░░░ to make a transition ░░░░░░░░ its direct to consumer ░░░░░░░░ then we re going ░░░░░░░░ be very you know ░░░░░░░░ re we re going ░░░░░░░░ be very open minded ░░░░░░░░ that FABER All right ░░░░░░░░ you ve told the ░░░░░░░░ now I mean but ░░░░░░░░ you already been looking ░░░░░░░░ that as an opportunity ░░░░░░░░ even having conversations about ░░░░░░░░ IGER We have been ░░░░░░░░ at as an opportunity ░░░░░░░░ ve had some conversations ░░░░░░░░ I I don t ░░░░░░░░ to elaborate.”