Michael Eisner on Media's Future
By now you may have heard that former Disney CEO Michael Eisner is in talks to become chairman of the Tribune Company after it emerges from bankruptcy. And you may also have heard that Eisner is making the promotional rounds for his new book, Working Together: Why Great Partnerships Succeed, which is due to hit stores next week. But for those of you who, like me, consider the timing of the Tribune news so close to the book’s publication more than a happy coincidence, shame on you (and me!) for being so cynical. Remember, it’s Rupert Murdoch that owns the news, not Eisner.
“I wish I was that savvy, but I’m not,” says Eisner in an interview with The Daily Beast, his first since the Tribune news broke. “Nothing that has come out has come from me. I can’t help people making conjecture, but I’ve never said anything about it and I’m not going to discuss it.”
Eisner’s modesty betrays the fact that he is indeed savvy when it comes to dealing with the press—throughout our hour-long discussion he never once fell for my attempts to bait him into talking about Tribune, steadfastly refusing to speak in particulars and generalizing about the overall media landscape. In that regard, Eisner proved confounding, with his comments reading more like misdirection than tea leaves. After all, this is the same guy who, in an interview with Variety ostensibly to promote his book about partnerships, recently said that one of the things he misses most about being CEO of a large media company is that he can “no longer be dictator.”
Or, to use an example from the book—which examines the dynamics between Bill and Melinda Gates, Brian Grazer and Ron Howard, Joe Torre and Don Zimmer, and seven other successful partnerships—Eisner writes in the epilogue that he has “always believed that when you’re making a partnership agreement, there should not be a provision on how that partnership ends.” That’s an oddly principled and trusting stance to take for someone who went through an ugly, public separation from Harvey and Bob Weinstein and had to pay Michael Ovitz $140 million for 14 months work at Disney precisely because the terms of their partnership separation weren’t clearly defined.
“Some things in media are about who is running [it]. Some assets are managed well, some aren’t. People do make the difference.”
According to Eisner’s perfectly logical argument, however: “If there’s a pre-negotiated exit, which most people have, it doesn’t force you at the end of the day to make it work. You can just push a button to end it. It’s a negative way to start a relationship.”
Eisner, 68, concedes that he played a role in the failed relationships with the brothers Weinstein and Ovitz and that he had a bad feeling in his gut as he was “walking down the aisle.” But he is quick to add that his relationship with the Weinsteins was never a partnership because Miramax was an acquired company and that the bulk of Ovitz’s $140 million in compensation came from stock options that “were never achieved.”
See what I mean by confounding?
So, when the former leader of the Magic Kingdom says that newspapers need to follow the example set by The New York Times and Wall Street Journal and create trusted, respected, and consistent brands that are enhanced by professionalism, it’s impossibly to tell if he thinks Tribune papers such as the Los Angeles Times and Chicago Tribune have those traits or are in need of them. Same goes for his views on management.
“In every business, in every industry, management does matter,” says Eisner, who left Disney five years ago and is now involved in ventures such as digital-media studio Vuguru and baseball card maker Topps through his Tornante investment firm. “Some things in media are about who is running [it]. Some assets are managed well, some aren’t. People do make the difference.”
Taken out of context, that comment could easily be construed as both a dig at Tribune’s current management and a hint of Eisner’s intentions with the company. But in light of the recent departures of ABC’s Stephen McPherson and David Westin, the network’s respective leaders for entertainment and news, he could just as easily be referring to Disney’s view of how its broadcast network was being run. Or NBC’s for that matter. (Note: The interview with Eisner was conducted before news of Westin’s departure, and he declined to comment about that or ABC in a followup request.)
There are, however, a few things that Eisner is perfectly clear about. Among them is that successful partnerships are marked by a series of traits, including the ability to share, be vulnerable, and speak freely. By contrast, envy and insecurity are almost always the twin pillars of a failed partnership. He cites the entertainment industry as one of the most ethical in American business, and says that the economy has been infected by “the death of honesty.”
Beyond these broad observations, the book suffers from the fundamental problem that what is interesting about the partnerships between the subjects covered is their intrinsic uniqueness, which means that the lesson inherent in them can’t be widely applied. What makes the partnership between Warren Buffett and Charlie Munger work probably wouldn’t work for another pair.
Eisner does prove himself adept at character development and exposition. There’s a priceless little scene in the second chapter where Buffett, arguably the most sought after investment guru of all time, tosses Eisner an old-fashioned pocket datebook completely devoid of appointments.
“I just sit in my office and read all day,” Eisner quotes Buffett as saying.
Eisner is clearly most comfortable writing about the industries and people he knows best, and the book really comes alive with the chapters on the relationship between Brian Grazer and Ron Howard and John Angelo and Michael Gordon. The latter duo make up the distressed investment firm Angelo, Gordon & Co., which holds a major chunk of Tribune’s debt and will have a large say in who ends up running the company. The close ties between the Eisner and Angelo family involve five generations, from their grandparents’ friendship a century ago right up through their current grandchildren. Michael and John even married a pair of friends from college—and Eisner is godfather to one of Angelo’s children. In short, there isn’t much these two friends wouldn’t do for each other.
“Well, I wouldn’t kill someone,” jokes Eisner, “but certainly I’m supportive of [whatever else] he would like to do.”
Though Eisner wouldn’t confirm it, one thing Angelo, Gordon would reportedly like to do is bring him in as Tribune chairman. But even if Eisner isn’t providing clues, the book offers a glimpse into the firm’s mind-set regarding Tribune.
“We have always felt like a good deal is when you make a good profit—and leave something on the table for the next guy,” Eisner quotes Michael Gordon as saying. “When we negotiate for bankruptcies, we’re tough but reasonable. A lot of people sue simply because they can sue; even if they have no foundation for the lawsuit, they can delay something three years. We would never do that. And we’ve been accused by everybody else as willing to take less than everyone else. To us, it’s a deal, and I’m not going to scrounge around for a year to make another two percentage points. It makes no sense.”
Though that may seem disingenuous given that the firm, Tribune, and some of the company’s other creditors are battling over competing reorganization plans, what Gordon is angling for is the same thing all bankers angle for: a deal that provides satisfactory recovery and sufficient upside. Perhaps that involves less money upfront, but an agreement to install a chairman and CEO handpicked by the firm. Perhaps Eisner. But would he do it? Blue blood runs deep, but does it run deep enough to convince a highly successful entertainment mogul like Eisner to return to the red-ink spilling businesses of newspapers and television in the hopes of leading them once again into the black?
Peter Lauria is senior correspondent covering business, media, and entertainment for The Daily Beast. He previously covered music, movies, television, cable, radio, and corporate media as a business reporter for The New York Post. His work has also appeared in Avenue, Blender, and Media Magazine.