Eisner spells out ABC view
In spite of low numbers, he's upbeat
In his letter to shareholders in Disney's annual report, released Monday, Eisner also responded to the increasing attacks on the Mouse House from religious groups like the Southern Baptists by vowing that "we will not let a mayor, or a congressman, or a senator or a particular interest group or even a president attempt to control our content."
Disney has been criticized by religious groups over its stance on gay issues, among others. Eisner suggested that these groups were singling out Disney for practices common to the entertainment industry "because it is more effective" to focus on Disney.
Without mentioning the issues, he said the subjects prompting the complaints "mostly surround some of our non-Disney branded films and our non-Disney television shows" and he noted that his wife often complains about some Disney releases.
"The truth is that we don't want to make bad movies or television shows or publish bad books, but when you are trying to break ground creatively, you do sometimes fall short ... To our critics I can only say that I regret when we fall short," he said.
In the letter, written as usual in Eisner's conversational style (complete with asides addressed to his children) the Disney chairman said, "It is true that since we purchased ABC, the network has dropped in primetime ratings. This is certainly not what we would have preferred but I got my start in the television business and learned long ago that, when it comes to prime-time ratings, what goes up always comes down again ... before it goes back up."
"Primetime continues to be cyclical and the bad news is that we haven't broken out of our down cycle. The good news: there's tremendous upside when it happens (and happen it will.) The ABC network represents 8% of the ABC corporate profits. I consider that small while they are doing badly and will consider it large when ABC turns it around."
Eisner also noted that "in the less volatile areas of the broadcast business, ABC is dominant. ... For example, ABC dominates daytime, where it has held the No. 1 position in the all-important 18-49 demographic for two decades. ABC-owned stations continue to enjoy the best profit margins in the business."
He also highlighted the value of ABC's cable channels, led by ESPN, "which was practically worth the cost of the acquisition itself." Disney stock fell 81¢ to $98.81 Monday.
Eisner also appeared to signal that Disney isn't planning to sell its radio station group. He noted in the letter that ABC radio stations and networks "are consistent ratings winners." He also talked about the synergies pursued by Disney and ABC, and noted that "I love Radio Disney.... It plays on 710 AM here in Los Angeles and I listen to it all the time."
Radio Disney is Disney's new radio network that Eisner said was "thriving on 13 ABC-owned radio stations across the country."
