Podcast Summary
The Importance of Focusing on Creators and Pursuing Excellence: Bob Iger emphasizes the importance of choosing the right people and committing to excellence in the media industry. Effective management of creative talent is crucial for producing high-quality content, and rushing projects to meet deadlines should be avoided.
Key takeaway from the conversation between Bob Iger and Sonal Chokshi on the Web 3 with a16z podcast is the importance of focusing on creators and the relentless pursuit of excellence in the media industry. Iger emphasized that choosing the right people and committing to excellence are crucial for producing high-quality content. He criticized the common practice of rushing projects to meet deadlines and prioritizing short-term gains over long-term vision. Moreover, Iger highlighted the significance of effective management of creative talent, both in terms of managing the creators themselves and those who manage them. By inserting oneself into the process in a supportive and non-intrusive way, executives can help ensure the best possible outcomes for their projects. Iger's approach, as evidenced by Disney's successful acquisitions of Pixar, Marvel, and Lucasfilm, has proven to be a winning strategy in the ever-evolving media landscape.
Understanding creators' perspective and fostering partnerships: Effectively managing creativity requires respecting creators' vision, providing constructive feedback, and recognizing the importance of the creative process.
Effective creative management involves understanding the unique perspective and self-esteem of the creator, establishing a genuine partnership, and providing authentic, constructive feedback. It's essential to remember that creators value their ideas deeply, and dismissing their input or imposing your authority can lead to tension and ruptured relationships. Instead, executives should strive to understand the creator's vision, articulate feedback in a thoughtful and constructive manner, and know when to stop. Additionally, it's crucial to recognize that managing creativity responsibly is essential for shareholders but should be done in a way that respects the creative process and the individual involved. By following these principles, executives can foster a productive and collaborative environment that allows creatives to thrive and produce their best work.
Communicating Effectively in Feedback Sessions: Focus on putting people at ease, addressing significant issues, and having a clear vision to ensure effective feedback sessions, leading to better outcomes and productive working relationships.
Effective communication, especially when providing feedback, requires sensitivity and tact. As shared in the conversation, sometimes it's essential to put people at ease before delivering constructive criticism. This can lead to better outcomes and a more productive working relationship. Additionally, it's crucial to focus on providing feedback that addresses significant issues rather than getting bogged down in minor details. This approach can help prevent feedback from being perceived as an investor mandate and minimize the potential for miscommunication or misunderstanding. Furthermore, as the conversation highlights, having a clear vision and being willing to invest in bringing that vision to life, even if it means additional costs, can lead to phenomenal results. Overall, the discussion underscores the importance of thoughtful communication and a commitment to bringing the best possible product to fruition.
Focusing on great content despite disruption: CEOs like Bob Iger prioritize investing in content creation over ownership of distribution to maintain high-quality branded entertainment.
Focusing on details and not being petty are not the same thing. The ability to focus on what truly matters, as Steve Jobs did with his focus on Migno Chay, is a skill that is earned through expertise, knowledge, and proven success. When it comes to the media industry, disruption was already underway in 2005, but the industry was still figuring out how to adapt. Bob Iger, then CEO of Disney, saw the potential for technology to create a proliferation of distribution and consumer opportunities. However, he believed that great content, high quality creativity, and branded entertainment would always stand the test of time, no matter what disruptive forces impacted the business. Iger prioritized investing in the content side of the business, rather than trying to own every new form of distribution. The focus should be on creating brilliant content, as creative talent is a fundamentally scarce resource. The industry should not be overly paranoid about the force of distribution ruining the business, but instead, invest more in creating high-quality branded entertainment.
Investing in high-quality branded content is crucial for a company's success: Disney's investment in Pixar, despite challenges, demonstrates the importance of creating high-quality content through great storytelling, effective creative management, and taking risks on new ideas.
Investing in high-quality branded content is a priority for a company's success, as demonstrated by Walt Disney and his enduring Snow White film. The key to creating high-quality content is telling great stories, which requires taking the time to develop ideas, managing the creative community effectively, and taking risks on new ideas. At the time, Disney Animation, a major contributor to the company's success, had lost its way due to process problems. To address this, Steve Jobs' Pixar, with its talented team, was identified as the solution. Despite the challenges of acquiring Pixar, including its unwillingness to sell and the animosity between the companies, the acquisition was pursued due to its alignment with the strategic priority of investing in high-quality content. The success of this strategy is evident in the continued relevance and popularity of Disney's content across various technologies and platforms.
A chance encounter between Ed Catmull and Steve Jobs led to a transformative partnership between Pixar and Apple: Being open-minded and willing to take risks can lead to innovative partnerships and acquisitions, as demonstrated by the collaboration between Pixar and Apple.
Being open-minded, willing to take risks, and fostering a culture of creativity can lead to transformative partnerships and innovations. IED's former CEO, Ed Catmull, shares his experience of how a chance encounter with Steve Jobs led to the groundbreaking deal between Pixar and Apple. Before becoming CEO, Catmull had shown interest in Apple and its innovations, which piqued Jobs' interest. During their initial discussions, Catmull proposed creating a television version of iTunes, which Jobs found intriguing. When Catmull showed his willingness to disrupt traditional media and embrace new technologies, Jobs' perception of him changed, leading to the acquisition of Pixar by Disney. The success of this partnership was rooted in respecting Pixar's unique creative culture and adopting their innovative processes. By fostering a collaborative and creative environment, these companies were able to push boundaries and create groundbreaking content.
Pixar's Groundbreaking Technology and Marvel's Storytelling Success: Pixar's innovative technology and Marvel's storytelling abilities led to critically acclaimed films and successful acquisitions
Pixar's success lies in their ability to create films with a tangible sense of place and characters that become an integral part of the story. This was evident during the speaker's visit to Pixar where he witnessed their groundbreaking technology that allowed for vast editing capabilities, changing specific images and having the change apply to the entire movie. This technology, which was a game-changer, helped Pixar produce critically acclaimed films like "WALL-E," "Up," and "Ratatouille." After the success of these films, Disney looked to expand their horizons and considered acquiring Marvel in 2009. Despite being unfamiliar with comic books, the speaker recognized the potential in Marvel's vast library of characters and the team's ability to tell great stories. The acquisition led to the production of successful films like "Iron Man," "Captain America," and "Thor," among others. In essence, Pixar and Marvel's success is rooted in their commitment to storytelling and their ability to execute it effectively.
Empowering creative teams and expanding portfolios: Effective brand management involves trusting creative teams, building brand identity, and strategically expanding portfolios with well-known properties. Marvel's success under Ike Perlmutter showcases this approach, resulting in the Marvel Cinematic Universe and the acquisition of Pixar, Lucasfilm, and ESPN.
Effective brand management involves trusting and empowering creative teams, building brand identity, and strategically expanding the portfolio with well-known properties. Ike Perlmutter, former Marvel Entertainment CEO, exemplified this approach by allowing Marvel's creative team to thrive and pitch innovative ideas, such as the Marvel Cinematic Universe (MCU). He emphasized the Marvel brand, keeping it distinct from Disney, and successfully introduced new characters and stories like Guardians of the Galaxy and Black Panther. Marvel's success led Perlmutter to consider acquiring other brands, such as Pixar, Lucasfilm, and ESPN, which strengthened Disney's media and entertainment empire. Although there were missed opportunities, like James Bond and Harry Potter, Disney's focus on quality storytelling and strategic brand expansion set it apart from competitors.
Disruptive impact of technology on media industry and rise of streaming: CEO Bob Iger recognized Netflix's potential to disrupt Disney's traditional distribution models and entered the streaming business to stay competitive, paying off with high-demand for Disney's high-quality branded content.
During his tenure as CEO of Disney, Bob Iger recognized the disruptive impact of technology on the media industry and the shift towards app-based entertainment and streaming. He saw that Netflix, as a leader in this space, was poised to disrupt traditional distribution models and monetization strategies. Iger also recognized that consumers were gaining more power and control over their entertainment choices, leading to a decline in linear television viewing. He believed that Disney, heavily invested in linear channels, needed to adapt and enter the streaming business to stay competitive. Iger's vision of content being king and distribution being everywhere was put to the test with the rise of streaming, and Disney's great content thrived in this new distribution vehicle. Netflix's willingness to pay top dollar for Disney's content showed that there was a demand for high-quality branded content in the streaming era. Iger's bold decision to enter the streaming business and redirect Disney's future proved to be a successful strategy.
Disney's shift to owning the technology platform for streaming: Owning the technology platform can deepen customer relationships and reduce reliance on other distribution channels, despite initial doubts and concerns.
Controlling the relationship with the customer by owning the technology platform can lead to a deeper, more intimate relationship and improved value proposition. Bob Iger, former CEO of Disney, shares how Disney struggled to connect with their customers through various distribution channels, such as movie theaters, cable, and satellite, until they realized the importance of owning the technology platform for streaming. This shift not only allowed Disney to create a stronger relationship with their customers but also enabled them to reduce their reliance on other distribution channels. Despite initial doubts and concerns about the technology side and Wall Street's reaction to the disruption, Disney ultimately invested in a solution and successfully pivoted to streaming. Decentralization, as Iger notes, is not synonymous with anarchy, and there are elements that may not be worth giving up when making such a transition.
Balancing centralization and decentralization during organizational change: Clear vision and stakeholder support are crucial for successful organizational change amidst disruptive technology
Leading organizational change, especially in the face of disruptive technology, requires a delicate balance between decentralization and centralization, as well as a shift in mindset and metrics for success. Disney's shift from licensing revenues to subscribers as a metric, similar to tech companies moving from software to software as a service, necessitated a significant restructuring and mindset change. This was a steep and challenging process, but having built up trust with the board, senior team, and Wall Street community through previous successful acquisitions helped. Not all incumbents take new tech seriously, but having a clear vision and the support of key stakeholders can make a difference. Disney Plus passing Netflix in subscribers is a testament to this.
Investing in disruptive business models despite financial risk: Investing heavily in disruptive streaming platforms can lead to long-term success, even with initial financial risk and short-term losses.
Going all in on a disruptive business model, even if it means significant financial risk and short-term losses, can lead to long-term success in the streaming industry. This was the advice given to the speaker by trusted investors, including Will Danoff from Fidelity. The speaker's decision to invest heavily in Disney Plus and depart from traditional licensing fees paid to Netflix resulted in a significant increase in subscribers and stock price upon launch. The shift from linear cable and satellite viewing to streaming is inevitable, and consumers are willing to tolerate ads for lower prices to afford multiple streaming platforms. Advertisers may benefit from this trend, but regulatory concerns may prevent some companies from acquiring content creators. Streaming is becoming the premium high-end experience, and new models with multiple tiers and ad-based options are emerging. The speaker believes that streaming will ultimately win over traditional television, with the exception of live events and news.
Media landscape changes with streaming services: Streaming platforms offer convenience, mobility, and personalization, challenging traditional movie theaters. Creators benefit from more opportunities to showcase work and reach larger audiences.
The media landscape is undergoing significant changes, with streaming services and high-quality television content challenging traditional movie theaters. Consumers are increasingly drawn to the convenience, mobility, and personalization offered by streaming platforms, making movie theater attendance a niche activity. Creators, too, are thriving in this new landscape, with more opportunities to showcase their work and reach larger audiences. The future of content creation and consumption will continue to be shaped by the interplay between technology, creators, and consumers, with all parties prevailing in their respective roles. The rise of peer critique and the importance of creatives drawing other creatives further underscores this trend towards collaboration and shared vision. Ultimately, the media industry is evolving to better serve the needs and preferences of consumers, with technology enabling new forms of storytelling and consumption.
Choosiness and Editorial Judgment Matter in Streaming: Disney Plus succeeds by respecting IP and providing a premium experience through choosiness and editorial judgment. Future growth may come from immersive digital shared experiences like AR and VR.
While volume is important in the streaming industry, it's not the only factor. Choosiness and editorial judgment are necessary to create a premium experience for subscribers. Additionally, the value of IP and the potential for immersive digital shared experiences are key areas of growth. Disney Plus stands out for its consistency and respect for IP, while the future may bring more communal experiences through technology like AR and VR. It's important to remember that perspective and adaptation are crucial when it comes to new technology. The past shows us that what may seem strange or weak at first can eventually become transformative.
The Value of Physical Interactions and In-Person Experiences: Despite digital advancements, physical interactions and in-person experiences continue to hold value and are likely to coexist with digital experiences in a barbell structure.
While digital experiences, such as virtual reality and virtual theme parks, can be compelling and immersive, they may not fully replace the unique and tangible experiences of the physical world. Disney World, for example, offers an immersive experience that is difficult to replicate in a digital format. The value of physical interaction and in-person experiences is likely to continue, even as technology advances. Additionally, the maturing industry trend suggests a barbell structure, where both digital and physical experiences will coexist and thrive. Regarding remote work, while productivity may be possible, creative collaboration, company culture, leadership, and mentoring are areas of concern. Web 3.0 and crypto, with their focus on bringing communities together and new ways to market and fund, hold exciting prospects, but the specific developments and breakout native creative experiences are yet to be seen.
Creativity and Technology: A Dynamic Interdependence: Technology inspires creativity and vice versa, leading to new mediums and experiences in various industries, from early film to virtual reality.
The relationship between creativity and technology is a dynamic and interdependent one. At Pixar, for instance, the creative team pushes the technology team to develop tools that help bring their stories to life in increasingly innovative ways. Conversely, the technology team creates new technologies that inspire the creative team to explore new directions. This dynamic is not unique to Pixar but is a common theme in various industries. We're currently entering an era of virtual reality, augmented reality, and web 3, where technology is becoming more accessible to creators, leading to the development of new mediums and experiences. This relationship between creativity and technology has been present since the early days of film, where technology expanded the creative possibilities beyond the confines of a stage. As Walt Disney once said, technology is a storyteller's greatest weapon, and it's exciting to imagine what new stories and experiences will emerge as technology continues to evolve.
Navigating Business in a Crisis: Agility, Collaboration, and Quick Decision-Making: In today's fast-paced business environment, the ability to adapt strategies and make quick decisions is crucial, especially during crises. Collaboration and openness to feedback can lead to better outcomes.
The importance of adaptability and quick decision-making in today's fast-paced business environment. The speakers discussed the need to pivot strategies and make decisions at a much faster rate than ever before. This is particularly relevant in the context of a crisis, where the ability to respond swiftly can make a significant difference. Despite the pressure to make quick decisions, the speakers also emphasized the importance of collaboration and openness to feedback. They shared that having a team and bouncing ideas off each other can lead to better outcomes. In terms of the upcoming book, while the title "Crisis of a Lifetime" was suggested, it was ultimately undecided upon. The conversation ended with a friendly exchange, with the speakers expressing their appreciation for each other's insights. Overall, the conversation highlighted the importance of agility, collaboration, and quick decision-making in navigating today's business landscape, particularly during times of crisis.
