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- Overview
- Iger’s succession plan
- Big Bob and Little Bob
- Relationship breakdown
- Dividing the company
- Awkward situation
- The Scarlett Johansson controversy
- A fight in Florida
- Chapek’s mild triumph
- Chapek’s sudden demise
After pushing back his retirement four times, Bob Iger finally made the leap. On Feb. 25, 2020, he announced he would step down as Disney’s CEO. His hand-picked successor, Bob Chapek, then Disney’s parks chairman, would take over the day-to-day job of running the company, effective immediately.
As part of the changing of the guard, the Disney board suggested the new CEO should take over Iger’s expansive office at Disney headquarters in Burbank, California.
There was just one problem. Iger had no interest in moving out. He wasn’t truly leaving Disney, anyway. His succession plan allowed him to stay on as executive chairman for 22 months. Chapek would report to him and the board. Iger would also “direct the company’s creative endeavors” — nebulous phrasing suggesting he would retain control of movie and TV content and operations.
There was a practical reason Iger didn’t want to move out of his office. It had a private shower, built for former CEO Michael Eisner, and a vanity for shaving. Iger, now 72, consistently woke up around 4:15 a.m. to work out and then shower at the office. On evenings when Iger was heading out for a Disney premiere, award show or benefit, he would often take a second shower in the office.
Iger told Chapek that he lived for those “two-shower days,” according to people familiar with the conversation.
Iger chose Chapek, now 64, as his successor because of Chapek’s integrity and business acumen, not his interest in Hollywood socialization. Chapek has the outward corporate demeanor of a Midwestern businessman — or, as one colleague jokingly put it, “a tuna salad sandwich who sits in front of spreadsheets.” He’s a risk-taker who’s not afraid to upend the status quo, but he’s not a schmoozer by nature. Whereas Iger holds court around his Brentwood mansion — a short stroll from celebrities, producers, super-agents and other Disney executives — Chapek lives about an hour’s drive from downtown Los Angeles, in Westlake Village. Iger enjoys yachting; Chapek is more of a power-boating and kayaking kind of guy.
Iger’s decision to step down as CEO not only shocked the entertainment and media worlds, it took even his close associates by surprise. Disney’s head of streaming, Kevin Mayer, whom many outsiders had pegged as Iger’s likely replacement, found out minutes before Iger’s public announcement. “I didn’t know that was coming at all,” Mayer told CNBC in 2021.
But Iger figured the timing was right. He was getting close to 70 and he’d been CEO for almost 15 years. The company’s recently launched streaming service, Disney+, was an instant success. And Iger was convinced Chapek was the right caretaker to continue his legacy.
Chapek grew up in Hammond, Indiana, “the son of a World War II veteran and a working mother,” as he has described it. His family took annual trips to Walt Disney World when he was young, seeding his genuine love for the company’s theme parks. He studied microbiology at Indiana University and got his MBA from Michigan State University. He joined Disney in 1993 and by 2015 had risen to become chairman of the parks division.
For more than two decades, Chapek earned Iger’s respect as a shrewd cost-cutter and a low-drama manager. Iger especially valued Chapek for his integrity and operational expertise. At each of the divisions Chapek led at Disney — home video, consumer products and parks — profit and revenue soared under his watch. He also benefited from some good timing, running the home video division when Disney animation hits such as “The Little Mermaid,” “Aladdin” and “Beauty and the Beast” were first sold on VHS and piloting consumer products just as “Frozen” launched.
Chapek cemented his reputation with Iger and the board during the construction of Shanghai Disney, the $5.5 billion theme park that opened in 2016 after months of delays. Iger and Chapek traveled to Shanghai, China, together more than 10 times as Chapek got the cost overruns and construction headaches under control. His success helped Iger move on from former Chief Operating Officer Tom Staggs, who was then in line to take the CEO job after Iger. Staggs left the company just before Shanghai Disney finally opened.
It was Iger’s experience with Staggs — who didn’t secure Disney’s top job after being promoted to COO specifically to be Iger’s heir apparent — that made Iger decide Chapek should start as CEO immediately. He told board members he didn’t think Chapek needed to audition for the role.
In “The Ride of a Lifetime,” Iger recalls watching Eisner leave the Disney lot on his last day at the company: “It’s one of those moments, I imagine, when it’s hard to know who exactly you are without this attachment and title and role that has defined you for so long.”
Just weeks after Iger announced his departure, Chapek began to wonder if Iger had regrets, according to people familiar with his thinking. Equally soon, Iger started to think he’d made a mistake.
At first, the signals were tiny. When Iger announced his departure to staff on Disney’s Burbank studio lot, he jokingly called himself “Big Bob” and Chapek “Little Bob,” a light reminder to employees about who was still the boss.
On March 10, 2020, about two weeks after the handoff, Chapek, Iger, Chief Financial Officer Christine McCarthy and a small handful of other Disney executives flew from Los Angeles to Raleigh, North Carolina, for Disney’s annual meeting.
At the front of the plane, Iger and Chapek were going over logistics and fretting about coronavirus. Iger caught Chapek off guard with some news. Chapek, not Iger, would lead the question-and-answer portion of the meeting, an annual ritual Iger called “stump the CEO.”
During his 27 years at the company, Chapek had only attended one annual meeting — as a guest in the audience.
Just days later, the two men had their first strategic disagreement. Chapek wanted to furlough about 100,000 parks employees after Disney World closed its gates. Iger advocated waiting for the government’s Covid-19 relief act to kick in so the furloughed employees would have some government money to hold them over. Iger called then-House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer, both Democrats, to ask them how close the U.S. government was to passing the bill. Ten days, they told him. Though it wasn’t a creative issue, Iger overruled Chapek. Disney didn’t furlough employees until April.
Around the same time, New York Times media columnist Ben Smith published a story about the pandemic’s disastrous impact on Disney. After “a few weeks of letting Mr. Chapek take charge,” Smith wrote, Iger had “effectively returned to running the company.” Iger didn’t deny this. “A crisis of this magnitude, and its impact on Disney, would necessarily result in my actively helping Bob and the company contend with it, particularly since I ran the company for 15 years!” Iger said in an email to Smith.
Chapek was furious. He called Iger and told him he didn’t need a savior, dropping a carefully placed expletive or two, according to people with knowledge of the call. It was the first time in more than 20 years that Chapek and Iger had had a major argument. Iger would tell people no colleague had ever spoken to him like that before in his life.
Chapek also complained to the Disney board about the story, demanding to be given a seat immediately; Disney had promised him one but had not set a date. Chapek did not want Iger and the board talking about him or his job status while he wasn’t there, according to people familiar with his thinking. Three days after Smith’s story ran, Disney complied. Arnold privately had a strongly worded conversation with Iger about setting him up for success rather than undermining him, according to people familiar with the conversation.
Arnold declined to comment for this story.
The relationship only deteriorated from there. Iger began privately grumbling that Chapek wasn’t involving him in company decisions. He told colleagues that he felt like he was on a bus that the other passengers wanted him to drive but he couldn’t reach the steering wheel. He began to understand that Chapek was not going to be an “obedient lieutenant,” as Roy Disney and Stanley Gold had once theorized Iger, himself, would be as Eisner’s chosen CEO.
When Chapek took over Disney, it was clear that Wall Street cared more about its streaming results than any other division of the business. Iger had already begun to reposition the company accordingly: “We’re all in,” he said when he unveiled Disney+ in April 2019. It added more than 10 million paying subscribers in 24 hours.
However, Chapek saw two major problems with the streaming operation. First, he believed there were too many people making decisions about what content was slated for Disney+. Iger and Mayer had tasked this responsibility to Agnes Chu, senior vice president of content, and Ricky Strauss, president of content and marketing for Disney+. Both Chu and Strauss have since left Disney.
Others wanted a say, including Mayer, Chu and Strauss’s boss, as well as Marvel Studios President Kevin Feige, Lucasfilm head Kathleen Kennedy, and the heads of Walt Disney Television and Walt Disney Studios. Mayer told Chapek the structure was messy and needed fixing.
Chapek brought a business school mentality to this challenge, which naturally rubbed creative executives the wrong way. He often cited the concept of ARCI — which stands for “accountable, responsible, consulted and informed” — as a framework for ensuring clear decision-making structures. Chapek would often say, “Who’s got the A?” — referring to accountability. With streaming, the answer wasn’t clear.
Second, Chapek understood that streamed movies were still seen as less prestigious than those with a traditional theatrical release. The chair of Walt Disney Studios, Alan Bergman, and his direct reports were reluctant to give projected hits to Disney+ or Hulu. Actors and directors overwhelmingly still wanted a box-office release. Even during Covid, Disney didn’t abandon exclusive theatrical releases, unlike WarnerMedia, which put each of its 2021 films on HBO Max and in cinemas on the same dates.
But box-office returns weren’t driving investor sentiment — streaming was. And during the early months of Covid, Disney had limited inventory because production on new TV series and movies had ground to a halt. Chapek wanted to put premium programming on Disney+ as soon as possible.
Throughout all this, executives who had lost power under the new structure were frantically complaining to Iger, who told them he didn’t agree with the reorganization — an assessment Chapek heard only indirectly — but that there was little he could do.
Many veteran Disney creative executives viewed the reorganization as an example of poor decision-making. Chapek loyalists saw it as a necessary change to modernize Disney, which they felt was being sabotaged by petulant TV and movie executives, with Iger’s tacit backing, according to people who were directly involved in the reorganization.
Around this time, in late 2020 and into 2021, Disney executives throughout the company started to feel increasingly awkward about the Iger-Chapek relationship. McCarthy warned Chapek that Iger’s criticism was reaching an increasingly wide audience.
McCarthy declined to comment for this story.
Most tried to ignore the rift and just do what they were told.
Zenia Mucha, who had been Disney’s head of communications since 2002, before Iger started as CEO, took a more active approach. Reminding Chapek of his predecessor’s legacy and stature, she urged him to portray a united front with Iger.
The first half of 2021 was good for both Disney and Chapek. The share price was rising. Disney+ topped 100 million subscribers in March, blowing away Netflix’s gains throughout the year. The world was getting vaccinated and returning to theme parks.
During a June board meeting in Hawaii at Disney’s Aulani resort, members heaped praise on Chapek, according to people familiar with the proceedings. This time, instead of asking Iger to stick around at the end for a private executive session, they asked Chapek. It was a small gesture, but one Chapek interpreted as the board viewing him as the true leader of the company, according to people familiar with his mindset at the time.
Chapek told colleagues he was finally feeling more comfortable in the job. More specifically, Chapek felt as though Iger had lost his path to return.
In hindsight, it may have been the peak of Chapek’s tenure. Only a month later, Chapek found himself back on shaky ground.
In March, Chapek and Daniel had made the decision to launch “Black Widow” — a Marvel movie starring Scarlett Johansson — for a premium additional price on Disney+ and in theaters on the same day, July 9, 2021.
There was one hitch: Johansson’s contract stipulated that her compensation was based on an exclusive theatrical release for up to four months. Since her contract was negotiated before Covid, this type of issue hadn’t arisen before. Her agent, CAA partner Bryan Lourd, spent months negotiating with Disney executives throughout the organization, warning Bergman and Chapek that Johansson would sue for remuneration if they proceeded with their plan, according to people familiar with the discussions.
A little more than a month into Chapek’s tenure without Iger at the company, Florida Gov. Ron DeSantis, a Republican, introduced the Parental Rights in Education Act — which critics called the “Don’t Say Gay” bill. The legislation would prohibit “classroom instruction by school personnel or third parties on sexual orientation or gender identity.”
Disney is one of the largest taxpayers and employers in Florida, and Chapek and Morrell were soon fielding media inquiries about the company’s stance on the matter. And employees — particularly animators at Pixar and Disney Animation — wanted to know how the company planned to react.
Iger tweeted his thoughts. “If passed, this bill will put vulnerable, young LGBTQ [lesbian, gay, bisexual, transgender and queer] people in jeopardy,” he wrote.
During Iger’s tenure as CEO and chairman, he had freely pontificated about an array of causes, including climate change, diversity and abortion. In a series of virtual meetings after the killing of George Floyd, Iger had told Disney employees that making their voices heard was the best way to bring about change, according to people on the calls.
Chapek wanted to chart a different path. Weeks before DeSantis introduced his planned legislation, Morrell had outlined a new communications strategy to the board. He wanted Disney to stay out of political skirmishes entirely and instead signal its values through “three Cs”: content, culture and community organizations supported by Disney.
Chapek and Morrell had assumed they’d have months to explain their strategy internally. But Iger’s tweet dialed up the pressure on Chapek to say something.
The “Don’t Say Gay” debacle was hardly an ideal prelude to Chapek’s contract renewal talks in the spring, which were led by Arnold. But, once again, he did have good news to highlight. Disney had weathered the Covid pandemic. In the first quarter of 2022, Disney’s parks, experiences and products segment saw revenues more than double, to $6.7 billion, compared with the prior-year period. It was time to look to the future.
Chapek outlined a bold vision to the board. He wanted to transform Disney into a modern media company, with Disney+ a globally dominant streaming service. Disney research showed the main complaint among Disney+ users was its lack of general entertainment. Chapek intended to push Hulu and Disney+ together to give adults more options — a “hard bundle,” he later called it.
He also hoped to figure out a role for Disney in the metaverse and hired 50 employees to focus on “next generation storytelling,” consciously avoiding the term “metaverse” to deter derision. Several Disney executives privately mocked the effort anyway, given the vagueness surrounding the entire concept. They wondered if Chapek was trying too hard to distinguish himself from Iger, according to people familiar with their thinking.
Without Iger on the board, Chapek also felt emboldened to rethink ESPN and Disney’s other TV properties. In particular, he wanted to consider spinning off or selling ABC and ESPN — a concept Iger had consistently dismissed (but later floated in a July 2023 interview with CNBC). When Iger was chairman, Chapek was so reluctant to broach the subject of selling legacy media assets that he’d carefully massage the language in slide presentations to avoid annoying Iger, according to people familiar with the matter.
Chapek argued that ESPN, under Disney, could have a future as a standalone digital business, unbundled from traditional pay TV — “the hub of all streaming sports,” as he and Pitaro put it. Chapek wanted fans to be able to watch any game on an ESPN app, no matter who owned the rights. To make that happen, Disney would need to strike partnership deals with both the leagues and competing services such as NBCUniversal’s Peacock, Apple TV+, Amazon Prime Video and Paramount+, which may or may not have been feasible.
Chapek was also starting to gain traction with the Hollywood community. He’d brokered peace on Johansson with Lourd and repaired that relationship. Dana Walden, who replaced Rice to lead Disney’s TV division, invited Chapek to her house to meet A-list showrunners and directors.
Iger spent the summer of 2022 vacationing in the South Pacific on his yacht; working on his second book; attending the funeral of former Capital Cities/ABC CEO Thomas Murphy, a longtime mentor; making some personal investments; and taking meetings with venture capital firms and tech startups that wanted to enlist him as an advisor. In September, he joined the board of venture capital firm Thrive Capital, founded by Josh Kushner.
Yet, as Chapek suspected and feared, Iger’s heart remained at Disney. One friend described Iger at that time as “bored out of his mind,” though others noted he appeared to be enjoying retirement. Privately, Iger continued to talk with past and present Disney executives about Chapek and the future of the company, with several urging him to return to Disney, according to people familiar with those conversations.
In the first half of 2022, Disney was the worst performing stock in the Dow Jones Industrial Average, down nearly 40% as part of the “great Netflix correction.” Netflix’s lack of subscriber growth in January, combined with rising interest rates and the end of the pandemic, had caused the market to revalue streaming companies. Suddenly, simply growing Disney+ wasn’t enough reason for investors to pump up Disney shares.
During the summer, Iger reached out to Schake, the new communications head, to wish her luck in her role. In turn, Schake invited him to dinner. They shared common acquaintances — specifically, former President Barack Obama and former first lady Michelle Obama. Iger and the Obamas are friends, and Schake was Michelle Obama’s former communications director.
Fearing Chapek may interpret the meeting the wrong way, Schake told both the board and Chapek about the meal. Chapek was perturbed, according to people familiar with the matter. Schake was supposed to be his communications director, and already she was dining with the enemy.
Still, although Chapek couldn’t shake his fear that Iger was plotting a return as CEO, Iger both privately and publicly denied this. Earlier that year, he told journalist Kara Swisher the notion was “ridiculous.”
- Alex Sherman, CNBC
Apr 21, 2021 · (Photo by Jeff Gritchen) MediaNews Group via Getty Images. As a track and cross country athlete in Hammond, Indiana, Bob Chapek used to run beneath the smokestacks of the steel mills, oil...
- Don Yaeger
Bob Chapek, chief executive officer of Walt Disney Co., wears a protective mask during the reopening of the Disneyland theme park in Anaheim, California, U.S., on Friday, April 30, 2021. Walt Disney... Get premium, high resolution news photos at Getty Images
Apr 30, 2021 · Mickey and Minnie's Runaway Railway / March 4 2020; Info. Park Information; Attractions; Calendar; ... 2021. Photo 2 of 6. ... 4 days ago 16 photos.
Feb 25, 2020. Bob Iger (left) assumes Role of Executive Chairman through 2021, Bob Chapek (right) is the new Disney CEO. Copyright 2020 The Walt Disney Company.
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Jan 19, 2022 · Disney CEO Bob Chapek saw his compensation package for the company’s fiscal 2021 hit about $32.5 million, more than double the $14.2 million he took home a year earlier.
