Boardwalk Times: Stories from the Seashore —What Peter Rice's Firing Means For Disney and Bob Chapek
Peter Rice, a clear candidate for the Disney CEO job, was fired by Disney CEO Bob Chapek due to "not being a good fit."
Welcome back to Boardwalk Times: Stories from the Seashore! In this month’s newsletter, we will be discussing Disney General Entertainment Chairman Peter Rice’s abrupt firing and what that means for Disney CEO Bob Chapek and the company at large. We are also diving into Lightyear’s box office performance and of course LINKS OF THE MONTH.
UPDATE: Disney would extend Bob Chapek's contract for three years on June 28.
What Peter Rice's Firing Means For Disney and Bob Chapek
On June 9, Peter Rice, Disney’s General Entertainment Chairman, was fired by Disney CEO Bob Chapek. Rice oversaw Disney’s General Entertainment division which encompasses ABC Entertainment, ABC News, Disney Branded Television, Disney Television Studios, Freeform, FX, Hulu Originals, National Geographic Content, and Onyx Collective.
The Firing
According to various sources, Chapek told Rice that he didn’t fit in with Disney’s culture. When Rice asked Chapek to explain why that is. Chapek told Rice, “Now is not the time.” The meeting was only seven minutes long and the firing was even surprising for Rice.
Shortly after news leaked of Rice’s firing. Disney Chairman Susan Arnold released a statement:
“The strength of The Walt Disney Company’s businesses coming out of the pandemic is a testament to Bob’s leadership and vision for the company’s future. In this important time of business growth and transformation, we are committed to keeping Disney on the successful path it is on today, and Bob and his leadership team have the support and confidence of the Board.”
It’s a confident statement backing Chapek but it loses a little weight when you realize two things.
It came at the same exact time he decided to unceremoniously fire a well-liked executive who was on a trajectory to potentially replace him.
Chapek hasn’t had his contract renewed yet. It’s up in February 2023. (More on that later).
What Happened?
So, what exactly happened here? Peter Rice was one of the few well-known executives that made the leap to Disney after the 21st Century Fox deal. Rice came from a different culture at 21st Century Fox. Chapek in a memo said that Disney General Entertainment needed “a more collaborative leader.”
From all indications, Rice was a team player. Sources say he got along with fine with Disney Media and Entertainment Distribution Chairman Kareem Daniel. Rice actually clashed way more with former Disney streaming head Kevin Mayer over greenlight powers. The power to greenlight shows for Disney’s various platforms was something that was taken away from him under Iger/Mayer. It wasn’t until Chapek/Daniel that the power was restored.
But despite gaining some power back through Disney’s constant reorganizations he still lost a ton of power. Rice didn’t get to manage Disney’s General Entertainment profit and losses, that power went to Disney Media and Entertainment Distribution. The only other knock against Rice when it comes to not being collaborative is that according to CNBC, some of his co-workers at Disney were frustrated with him for monopolizing information instead of sharing it.
According to The Hollywood Reporter, Disney Chief Financial Officer Christine McCarthy felt that Rice never adapted to Disney’s culture. The report also states that she also played a role in ousting former Disney communications chief Geoff Morrell.
What else outside of not being collaborative enough and not adapting to Disney’s culture got Peter Rice fired from Disney? I think there are a couple of other things that were brewing. I don’t need to recap Disney’s “Don’t Say Gay” saga, but let’s just say Peter Rice’s handling of it in comparison to Disney CEO Bob Chapek’s was vastly different. Rice’s statement came across as supportive and tough but also if you read between the lines it looked like a moment for him to prove how he would handle the controversy if he was the CEO of Disney. I’m sure that didn’t sit well with Chapek that he spoke out about it. I think that would have happened if anyone else in the C-Suite at Disney spoke out about it. Chapek knew Rice was angling for his job, and he had to take him out before he was taken out.
It also doesn’t help Chapek that Peter Rice met with David Zaslav a while ago about a potential role at Warner Bros. Discovery, a rival to Disney that wants to remake itself in the image of Disney. Chapek also probably doesn’t appreciate that Bob Iger (former Disney CEO) and Alan Horn (former Disney Studios chairman) have given advice to his competition Warner Bros. Discovery Chairman David Zaslav as well. For Rice, the Warner Bros. Discovery gig didn’t materialize as Zaslav realized having an extra layer wouldn’t make sense for his own ambitions to run a talent-friendly company.
Chapek wanted to take out his competition in Peter Rice. In the past back when he was running the Parks, Chapek fired the President of the Disney Parks Western Region, Catherine Powell. Someone who many thought of as a potential replacement for Chapek to lead the Parks and one day possibly become CEO of Disney. (Powell is now the Global Head of Hosting at Airbnb).
Could This Have Been Handled Differently?
In the end, could Disney have avoided the headlines from Peter Rice’s firing?
Disney couldn’t offer him a producing deal or a softer exit? You would think Chapek would want no bad blood with someone with deep ties to the Hollywood talent community. You’d think he would want to avoid any and all bad press. Firing a Peter Rice is a lot different than firing an executive or cast member in the Parks division. There’s not going to be multiple reports (and newsletters haha) written on it.
Rice’s contract was extended in August 2021. According to The Ankler, Rice had a one-year deal. Other outlets have reported that Rice had signed a three-year extension. There is a big difference between August 2022 and August 2024. It seems that the three-year extension was more likely which makes the firing even more baffling.
Disney could’ve cut ties with Rice this past summer but instead, Disney renewed his $20 million-a-year contract. Now the company will have to likely pay Rice around $50 million in severance. Let’s just hope Geoff Morrell’s severance was less than that number.
Rice didn’t even try to spin the media headlines on his way out. He insisted that the headline note that he was fired and not something softer like “pursuing other opportunities” and or “stepping down.”
So What Now?
In the midst of the Bob Chapek-Peter Rice saga, not a ton of focus was given to Rice’s successor until after the fact.
Dana Walden, another executive from the 21st Century Fox acquisition, has taken the reigns and is now the Chairman of Disney’s General Entertainment Content division. Some even believe Chapek may have thought Walden, not Rice was the one responsible for Disney’s hits on ABC, Hulu, and Disney+. Walden was previously just the Chairman of Walt Disney Television. Now Walden has oversight of the General Entertainment Content division which has more than 300 shows and an annual budget of around $10 billion. That’s a colossal upgrade in power and oversight.
Walden’s biggest goal now is to deliver more Disney-branded hits on Disney+. Both Lucasfilm and Marvel Studios have been carrying Disney+. Walden built a nice streak at Hulu with buzzy shows like Only Murders in the Building, The Dropout, and Dopesick. Can she potentially replicate that same level of success but with Disney’s number one platform? Can upcoming Disney-branded titles Percy Jackson and the Olympians, National Treasure, The Society of Explorers and Adventurers, and others deliver some success on Disney+?
Did Chapek’s promotion of Walden end up creating a new threat to his job? Dana Walden could become Disney’s first woman CEO. Walden seems to be beloved in the right media circles so I wouldn’t be shocked if we see her name popping up a lot more as a potential Chapek replacement.
A lot of Chapek’s tenure so far has been highlighted as going against the typical Disney approach. Disney’s response to the multiple controversies in Florida, the ScarJo situation, and now this. One has to wonder if Chapek had a better relationship with his predecessor Bob Iger and took his advice and his fellow team’s advice if Disney would be in better shape. According to Puck News, Chapek cut Iger out of the decision-making towards the end of his time at Disney as well as ignored Iger’s communication person Zenia Mucha who warned Chapek not to hire an outsider like Geoff Morrell to replace her.
After all the bumpiness one has to wonder when Bob Chapek’s extension is coming? If the board is confident in him and if Wall Street still believes in him then why hasn’t it happened yet? Is Chapek not having an extension already a sign of no support?
I personally feel like Disney needs to either commit to Chapek or not commit to Chapek before D23 Expo. Why? It’s your massive Disney fan event with the promise of kicking off the Disney 100th anniversary celebration. I don’t think you want a CEO kicking off that event that may be fired in February. Although the one thing that is benefitting Chapek is that time is technically on his side. He’s been given a break due to the pandemic disruption. Also, Disney CEO tenures can vary drastically. You have Bob Iger who was CEO for 15 years and Michael Eisner who ruled the kingdom for 21 years. Then you have Donn Tatum (5 years at the helm) and Card Walker (7 years at the helm), and you also have Ron W. Miller (1 year). Where will Chapek’s reign fall into?
Another advantage that Chapek has is that Disney’s board lacks executives with media experience (there may be too many conflicts of interest if more media people were on the board). So, all of his media mishaps probably aren’t as frowned upon by people who help run businesses like Nike, General Motors, and Oracle. The board doesn’t care about the headlines, they care about the bottom line.
So, in the end, what does the Peter Rice firing mean for both Bob Chapek and Disney?
For Chapek, it means he can’t shake the narrative that he is paranoid about his position. The move also reaffirms that his moves are often clunky and not smooth. On the other hand, he may have just been done working with Peter Rice. Things happen and it’s understandable. If a report comes out that says Disney was looking into replacing Chapek with Rice, I’ll give Chapek a lot more credit for playing offense. Although if the Disney board really wants to they can give Rice the job at any time.
Rice’s firing won’t drastically change anything at Disney. It did hurt morale but it also paves way for Dana Walden. Is it a little bizarre that some of the most prominent execs from the 21st Century Fox deal are slowly fading out of Disney? Yeah, it is. The Fox deal will be fun to look back on in 10 years. Although on the other hand the Peter Rice move also signals that Disney may not be afraid to ax future threats to Chapek. After Peter Rice, could Disney Parks’ beloved leader Josh D’Amaro be next? Would Chapek get rid of his right-hand man Kareem Daniel? What about Dana Walden or Rebecca Campbell? I wouldn’t rule it out after the Peter Rice move.
Lightyear Is Pixar’s Big Return to Theaters
Lightyear was Pixar’s grand return to theaters after the studio had its last three films debut exclusively on Disney+ (Soul, Luca, and Turning Red). Lightyear was expected to do a big number over its opening weekend but it underperformed with only $51 million. The incredible hold of Top Gun: Maverick along with the combination of Jurassic World: Dominion definitely played a part in its underperforming start. In its second weekend, it is projected to dip 65% and will only have a total of $17.7 million. I guess tough competition stacks up.
Lightyear was also given a weird complex both by the media and audiences. There were complaints about a two-second gay kiss, Tim Allen not voicing Buzz (don’t cry for Tim he’s getting Disney+ money for The Santa Clauses), and that the concept was “too confusing.” It was quite simple as it’s the film that Andy saw that inspired the toy. Obviously, Pixar took some creative liberties and changed some things but we can address those another time.
Did sending the last three Pixar films to Disney+ play a part in this? Maybe. Or we could also take a look that it may just take family animation longer to return to its normal box office highs. I do think the opening weekend box office will affect if Disney had any plans for this new sub-franchise in the parks. Then again we don’t know how much Disney wants to spend on the parks right now and how a Lightyear attraction would be a priority considering they have a ton of other franchises with untapped potential. You don’t always have to go back to the Toy Story barrel.
At the end of the day, I just hope Lightyear doesn’t stop Pixar from exploring more eccentric spinoff ideas.
PODCAST PLUGS 🎙
The Zach Perilstein Show with Elizabeth Pfeiffer. (Apple) (Spotify)
All six episodes of our Obi-Wan Kenobi pod. But listen to the finale episode if you’re caught up. (Apple) (Spotify)
Our first four episodes of our Ms. Marvel pod. Latest one… (Apple) (Spotify)
LINKS OF THE MONTH
— I’m excited to see more from Warner Bros. Themed Entertainment. This Batman experience looks pretty cool. (Variety)
— “We chose not to proceed with the digital rights given the price required to secure that package,” said Rebecca Campbell on Disney not getting the IPL Cricket rights for streaming. Disney+ could potentially lose 20 million Indian subscribers. (The Hollywood Reporter)
— Charita Carter Is The Woman And Disney Imagineer Behind The Upcoming Princess And The Frog Attraction. (Essence)
— What Would The Ultimate Disney Multiverse Park Look Like? (Boardwalk Times)
— How Disney lost Florida. (Financial Times)
— Guardians of the Galaxy: Cosmic Rewind will be receiving a holiday overlay! (Laughing Place)
—I agree with a lot of these picks: The 38 Essential Dishes and Restaurants at Disney World. (Eater)
— The Mickey Wiki wrote a new article for Boardwalk Times: Replacing the Great Movie Ride Was Walt Disney World’s Biggest Mistake. (Boardwalk Times)
Thank you all for reading and supporting Boardwalk Times: Stories from the Seashore. Next month we write about Lake Nona, and that’s all I’m going to tease for now.
We will see you next month! Please follow us on social media @BoardwalkTimes and visit boardwalktimes.net for more commentary, news, and opinions on the worlds of Disney and themed entertainment.