DANIEL VAUGHAN: Disney blames Ron DeSantis for its own institutional collapse

 May 19, 2023

You must give Disney this: some intelligent communications people work at the House of Mouse. The New York Times breathlessly reported that Disney was "pulling the plug on an office complex that was scheduled for construction in Orlando at a cost of roughly $1 billion. It would have brought more than 2,000 Disney jobs to the region, with $120,000 as the average salary."

Additionally, Disney decided to shut down a year-old Star Wars-themed hotel and continue with layoffs and cuts across the organization. The Disney memo leaked to the New York Times didn't mention Governor Ron DeSantis, but Disney made sure the New York Times filled in all the correct names.

The news story perfectly encapsulates a clean hit in political media. Disney pawned off cuts and layoffs that were already coming and blamed it all on Florida and Republican Governor Ron DeSantis. The political press happily publishes this hit because they don't read financial news or the latest earnings reports that show none of this was new news.

New York Times publishes a Disney hit piece.

First, the New York Times focuses on the Lake Nona campus, a development proposed under Disney CEO Bob Iger's predecessor, Bob Chapek. The Times added, "Mr. Iger, who came out of retirement to retake Disney's reins, was much less enthusiastic about the project — even before the company became mired in its battle with Mr. DeSantis. As soon as he returned to Disney, Mr. Iger began telling lieutenants, for instance, that it made little sense to move Imagineering so far away from Disney's movie studios."

To say Iger disliked Chapek is an understatement. The Wall Street Journal did comprehensive reporting on how Iger instigated a "coup" to replace Chapek in 2022. The WSJ reported that Chapek got undermined, deflated, and countered by Iger at every turn. Whatever plan Chapek had, Iger tried to sabotage it.

The Lake Nona campus was near the top of the list of reveals for Iger. In other words, Disney and Bob Iger are using Ron DeSantis to finish off a C-Suite rivalry that led to a well-documented takeover by the CEO.

Disney blames DeSantis for a hotel it couldn't fill.

The New York Times also added that Disney was shutting down its high-end Star Wars-themed hotel, implying DeSantis was involved here too. But that's also false: the Star Wars hotel "Galatic Starcruiser" was an abject failure. Reports were coming out in March of 2023 that Disney couldn't fill rooms, customers weren't filing slots, and the hotel was shutting down mid-week because it didn't have enough bookings.

Disney's other cuts in the New York Times report align with previously announced cuts from their Q1 and Q2 announcements of budget cuts, layoffs, and more.

Left out of the Times reporting are other Disney issues. Will we blame Ron DeSantis for Disney losing subscribers to its streaming service? A week ago, Disney's stock collapsed nearly ten percent after announcing subscriber losses after Wall Street expected gains. Iger has also had streaming content on the chopping block, with losses and layoffs mounting at the House of Mouse.

Is DeSantis to blame that Iger's planned reorganization of the company isn't going well? In the second quarter of this year, Iger made a big splash by announcing layoffs across the company, including places like ESPN and ABC News. Outlets like FiveThirtyEight are effectively in the process of folding while Iger's reorganization takes place.

Disney uses DeSantis as a foil for its own failures.

The backdrop for this is the media winter that has destroyed revenue across all media outlets. I've often pointed out that places like CNN are struggling, which is why they've got a death grip on Donald Trump to save themselves. Disney plans to fire people and reduce costs.

Iger's plan to cover for all these losses and layoffs is to blame Ron DeSantis. In terms of corporate messaging, it's a valuable strategy because outlets like the New York Times, which doesn't regularly cover business news, are reporting out Disney's memos like press releases. Most financial news outlets don't reprint the press statements of a company without a disclaimer; the New York Times saw no problems.

Bob Iger is blaming Ron DeSantis, but the real culprit is that Disney is losing money. Iger hated his predecessor and is doing everything possible to wipe out Chapek's legacy at Disney. Whether this all works is another story, but the truth is very simple: Disney is losing money, and Iger is desperate to pawn off his failures on someone else.

For now, Ron DeSantis is that man. Unfortunately for Iger, most Americans agree with Ron DeSantis. Score another one for the Republican Governor in Florida, who is on the verge of launching a Presidential bid.

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