It has built a lineup of entertainment properties like none other in the world, and it has a history even older than Mickey Mouse (he’s 92). So the storied brand has fully merited the huge store of credit it gets—from movie-goers, vacationers, Broadway audiences, sports fans, lots and lots of kids.
And now…from banks.
The big media headline this week was that Disney had secured a new one-year line of credit from Citibank, a $5 billion agreement to extend through April 9 of next year. The infusion of cash is targeted to offset what the company is facing due to the coronavirus pandemic: a plunge worse than Gaston’s off the parapet of the Beast’s castle.
In the short term, anyway, that’s where Disney’s revenues are headed, straight down.
The falloff is completely unavoidable, and not because of anything Disney has done wrong, but the exact opposite: Disney, under its long-time chief executive, Bob Iger, has created an empire of mass attraction. The masses are attracted to its incredible range of properties, and they virtually always share them en masse. Unfortunately, combatting the scourge of Covid-19 has meant separating people from each other, and, inevitably, from just about everything Disney does to make money.
Theme parks, of course, are front of mind, every ride and animatronic creation shut down and silenced. But then there are the movies and Broadway shows that are supposed to be played in theaters (often the same stories repackaged in multiple forms, a distinctive Disney invention); and the docked and anchored cruise ships, the now-empty hotels, the Disney shops in every now-closed mall.
With no certainty about when live sports might resume, ESPN doesn’t even have anything to talk about during its myriad editions of “SportsCenter” either—except the upcoming NFL Draft, which has already been analyzed more than thoroughly than the neurotic Elliot Carlin on “The Bob Newhart Show.”
The most dangerous days for ESPN may be ahead with both the baseball and college football seasons threatened. How can a cable operator—or subscriber—justify paying a monthly fee for a sports channel with no sports?
The only upward-pointing arrow has been the warm reception for the new Disney+ streaming service, which quickly amassed more than 50 million viewers. But that division won’t be generating profits to offset the cash bloodletting for several years at least.
No bank, certainly not Citibank, could miss the obvious need for Disney to protect itself with an infusion of borrowed cash; nor have any reason to worry that the company is good for the money. The most recent $5 billion from Citibank was intended to pump up an already existing credit nest-egg. Disney had previously agreed to a separate $5.25 billion one-year credit agreement with Citibank, on top of a five-year $3 billion agreement.
He was an executive characterized by hard work, an attentive eye and an ear to transformations in the business and a skill for management, first in managing up, but later in managing across an expanding empire. He was also a charming sort of fellow, but always, always in a low-key way. Sometimes in interviews you had to strain to hear him.
The word I heard most often used about him was “unflappable.”
Maybe he will remain so in the midst of a financial battering that descended suddenly on a place he had worked so ambitiously and diligently to fashion into an unprecedented powerhouse of media and entertainment. But Iger could also be forgiven if all of this untimely ill-fortune maybe got him flapping, just a bit.