Film News

Bad Blood: Looking Back at Comcast’s Attempt to Buy Disney in 2004

Did Comcast CEO Brian Roberts just Stop! Or My Mom Will Shoot Bob Iger?

That statement requires more explanation:

Starring in 1992’s Stop! Or My Mom Will Shoot was one of the worst decisions of Sylvester Stallone’s career to that point (Rhinestone being another), and it all happened because of Arnold Schwarzenegger’s lies.

Back in the early 90s, the future Planet Hollywood business partners were locked in a real dick-measuring contest whereby every inflated movie salary, record-setting box office performance, and over-the-top body counts were pieces in the larger competition for the title of biggest movie star in the world. They were constantly competing for the same roles and battling each other in the press. So, Arnold used that to his advantage. The Stop! Or My Mom Will Shoot script was terrible, and he wanted nothing to do with it. Still, he concocted a lie about how he was keen on doing the movie for the right, rather exorbitant price and fed it to the press. The producers went to Stallone instead, figuring they could get him for cheaper, and he took the bait, walking straight into a box office bomb gift-wrapped for him by the Terminator.

Such stories are hardly unique in Hollywood, where competition is fierce and career sabotage lurks around every corner.

Is that’s the kind of thing Comcast CEO Brian Roberts and Disney’s Bob Iger are engaged in right now?

Obviously, a professional rivalry between two roided out 90s movie stars who were commanding salaries in the mere twenty million dollar range is nothing compared to the multi-billion dollar brewhaha over 21st Century Fox which has broken out between Roberts and Iger. After all, you don’t bid $65 billion for Fox, as Roberts did earlier this month, if you’re not at least kind of serious about it. Plus, 21st Century, with its rich film & TV content and sports channels, is certainly an objectively desirable asset.

Still, there have been repeated whispers in the business and industry trades suggesting this fight is oddly personal, not the mere whims of the ridiculous rich but instead, a giant game of dudes in six-figure suits more or less yelling “Oh, no you don’t, you sonofabitch!” at each other.

“Iger would rather lose Mickey Mouse’s right arm than lose Fox to Comcast,” a management consultant recently told THR.

But, why? How did Brian Roberts and Bob Iger turn into the Katy Perry and Taylor Swift of the entertainment CEO world? They’ve clearly got bad blood, but who made the first really deep cut?

To find the answer, we have to go all the way back to 2004, a time when George W. Bush was President, there were Blockbuster Video stores around every corner, and Netflix, Google, and other future tech behemoths were the new kids on the block. Iger, a former weatherman turned ABC executive, had ascended the Disney corporate ladder to become Michael Eisner’s right-hand man, holding the titles of President and Chief Operating Officer since 2000. Within a year, he would finally succeed Eisner, but in 2004 Disney was still Eisner’s baby, for better or worse.

The one-time savior of the Mouse House had been driven egotistical in success and thus increasingly sloppy in execution, leaving Disney a shell of its former self. Profits were a third lower than they had been just 6 years earlier. Accordingly, the share price was at its lowest level in 7 years.

Worse yet, Eisner aggressively pushed out any dissenting voices, leading to a shareholder revolt spearheaded by Roy Disney. The studio’s iconic animation department had been allowed to atrophy, mostly outsourced to Pixar. Even that was about to end since Eisner continued to butt heads with Steve Jobs in the go-nowhere negotiations to somehow keep Pixar in the Disney family after its contract expired with the production of Cars.

Brian Roberts, a Forbes 400 billionaire whose father Ralph founded cable company Comcast in 1969 and eventually appointed him President in 1990 when he was just 31, smelled blood in the water. As The Economist explained in February 2004:

 “WITH viciously perfect timing, Comcast, a cable-TV company, last week launched a hostile takeover bid for The Walt Disney Company, arguably America’s best-known entertainment company. Comcast is taking advantage of a particularly weak point in Disney’s history. Last month Disney’s most important business partner, Pixar, an animation studio, abandoned it. At the end of last year, two board members, Roy Disney and Stanley Gold, resigned and started a campaign to oust Michael Eisner, Disney’s boss. On the day that Comcast announced its bid, Disney’s executives started an investor conference in Florida, an occasion they had counted on to boost the company and its share price”

From Roberts’ viewpoint, vertically integrating cable distribution and content creation through a combined Comcast-Disney made perfect sense given the state of the competition. Time Warner already had Warner Bros. Rupert Murdoch’s News Corp. had just bought DirectTV a year earlier. Moreover, Disney’s sky high carriage fees for channels like ESPN had been irritating the cable providers for quite some time. This way, Comcast could just buy them out and be the one charging the competition through the teeth for ESPN.

Small problem: Disney wasn’t actually for sale. Roberts was attempting to initiate a hostile takeover, betting he could throw enough cash/stock at the Disney board to get them to turn on Eisner and hand over the company. It actually worked. Kind of. Eisner was temporarily forced from his position as chairman of the board after 45% of shareholders voted against his re-election to the board, but he later managed to regain support. Throughout it all, the board still expressed little interest in negotiating with Roberts.

Comcast was barely mentioned at the investor conference in Florida the day the bid came in, and the board formally rejected the offer several days later. Two months later, Comcast officially abandoned its pursuit of Disney. Roberts attempted to spin it as no big deal, but it was a sound defeat for a fiercely competitive man who just a year earlier had thrown down $47.5 billion to acquire AT&T Broadband. Michael Eisner, Bob Iger, and the Disney board denied him an even bigger victory. To make matters worse, Iger then executed the corporate revival at Disney Roberts had hoped to do himself, and then Iger got to turn around and charge Roberts way too much to carry ESPN, signing a lucrative 10-year carriage contract in 2012, which is right before ESPN’s numbers started crumbling.

Of course, Roberts eventually got his vertical integration wish, purchasing NBCUniversal in 2011, and he’s made no secret of his attempt to copy the Disney playbook – “family animation, theme parks, and consumer-products businesses.” That’s how he ended up buying DreamWorks Animation in 2016.

According to The Wall Street Journal, at one point last fall he thought he was on the cusp of adding 21st Century Fox to the mix. Serious negotiations took places. Terms were exchanged and an offer was made. Comcast was just waiting for Rupert Murdoch and Fox to hand over some promised business data. Suddenly, though, they encountered total radio silence. No one at Fox would return their calls.

Then a couple of weeks later Roberts and his crew woke up to the following headline:

Damn. That’s cold. Just completely ghosted. Worse yet, Disney’s all-stock offer was for $12 billion less than Comcast’s all-cash offer (there are tax considerations, of course). WTF, Rupert Murdoch? Roberts, according to the WSJ, took it personally, confiding in a friend, “I don’t know what more I could do.”

He must have felt a slight sense of deja vu. Disney was buying Fox for $52.4 billion. 14 years earlier, Comcast’s final offer for Disney was $54.1 billion. Aww, hell no. If Roberts can’t have Fox Iger doesn’t get to buy it for just $52 billion. Let the bidding war begin.

So, after the Justice Department’s attempt to block the AT&T-Time Warner merger failed Comcast formally offered $65 billion for the Fox assets. Disney responded by raising its offer to $71.3 billion in cash and stock, a 36% increase over its opening bid. Comcast is expected to counter, and analysts predict the bidding will eclipse $80 billion.

The cast of HBO’s Success…no, wait. I mean The Murdochs.

This all a huge win for the Murdochs when you consider the following: as of 2 years ago, 21st Century Fox was worth just $44 billion. Rupert reportedly personally prefers Iger to Roberts, which has Roberts to lead a character assassination campaign, painting Iger as untrustworthy and lacking a clear line of succession should he leave the company. This has understandably irked Iger and drudged up memories of 2004.

The Murdochs, for their part, are said to be willing to simply go to the highest bidder, but Disney is the clear favorite, if only because the Roberts family’s owns one-third of Comcast stock whereas Disney has no majority shareholder. So, if Fox goes to Disney, the Murdochs would have a larger say in the company than they would if it goes to Comcast.

Of course, when Roberts found about that he was so incensed he went out and tried to buy Sky, as a side way into the deal, hoping to maybe salvage a split of the 21st Century Fox assets with Disney. To this point, both Disney and Fox have been resistant to that idea.

This is unfamiliar territory for Iger. While his acquisition streak is legendary in Hollywood, it’s comparatively small potatoes to Roberts track record. Iger’s additions of Pixar, Lucasfilm and Marvel add up to less than $16m; Roberts more than doubled that when he bought NBCUniversal and nearly tripled it when he bought AT&T Broadband. So, he’s used to these high stakes bidding wars, and even if he loses he will have succeeded in forcing Iger to overpay.

It’s not all because of what happened in 2004, but a lot of it is. This isn’t quite a full Stop! Or My Mom Will Shoot Situation. Roberts isn’t completely playing Iger like Arnold and Sly, but the rivarly is all the same.

Sources: Wall Street Journal, Economist, Wharton,


  1. Well, the shareholders of Disney were more p… off that Eisner just said no without ever relaying the offer to them then actually angry about a lost opportunity to sell. There was huge resistance about the very idea of giving Disney to anyone, both within the company and from the public (and Disney is very conscious of its image). Plus, there was this little movie called “finding Nemo” coming out, and since Disney had the distribution rights, they made a ton of money which in turn lead to the stock price suddenly shooting up, making a hostile take-over to expensive for comcast.

    Hopefully Bob Iger doesn’t overdo it. Even with his current offer he is overpaying and frankly, I don’t think that Disney really needs Fox to dominate the market. It’s useful and will make a lot easier, but there is a point at which it won’t be worth it…and remember, not only the Fox shareholders have to agree to any deal. The same is true for the Disney and the comcast shareholders, respective.

    1. Actually, Finding Nemo came out 8 months before Comcast’s initial hostile takeover bid. Even with that film’s success, it wasn’t enough to return Disney’s profits/stock price to where it had been 6 years earlier. Part of that was down to Eisner’s poor governance, but a lot of it was also outside of his control. Post 9/11, Disney and other theme parks really struggled as consumers started cutting back on those kinds of expenses. That was a larger economy issue outside of Disney’s control. Also, at that point ABC was seriously struggling and dragging down the larger company’s stock price, sort of like ESPN is now.

      Still, you are exactly right – Comcast’s bid was viewed as an actual insult to Disney because it so thoroughly undervalued them, but even if he had come in promising heaven and Earth it would have been a tough argument to make because they simply didn’t want to sell to anybody. They wanted new leadership, not new ownership.

      However, Finding Nemo did seriously, seriously piss off the Disney board. They wanted to try and buy Pixar prior to the film’s release, but Eisner swore Nemo was a mess and would be their first box office miss. The time to buy would be after that because then Disney would have the leverage over a suddenly vulnerable Pixar. Of course, he was 100% wrong, and Finding Nemo broke all kinds of records, further motivating Pixar to seriously explore its options as a non-Disney entity. At the time Comcast swept in with its bid, Pixar was thought to be on the way out because egomonsters Eisner and Jobs hated each other so much. After the release of Cars, Pixar’s commitment to Disney would be complete and it could be bought by someone else or strike out on its own. It wasn’t until Iger finally replaced Eisner that Pixar was back in play at Disney.

      “Remember, not only the Fox shareholders have to agree to any deal. The same is true for the Disney and the comcast shareholders, respective.”

      I know. So many outlets were writing about the Disney-Fox deal last week as if it was a done deal, but that’s not how this works. All the boards have to vote to approve, and beyond that Comcast has to be given a set number of days to prepare a counter. If they counter then Disney has something like 5 days to counter their counter. That’s why we call this a bidding war. 21st Century Fox is on the auction block, and these two dudes who hate each other are bidding over it. Even then, though, their board has to give the OK. Brian Roberts at least controls a third of the Comcast board, and the Murdoch family has a presence on the Fox board. Disney doesn’t have a majority shareholder meaning Iger can’t just will this into existence, but his track record is so strong I imagine the board must trust him implicitly now.

      Still, Iger is playing in Roberts ballpark now, and it really looks like he’s getting played. It’s not a full-on Arnold-Sly situation like I joked in the piece, but Roberts is driving the price so sky high Disney is going to be far more challenged to make out on this the way they have with Lucasfilm, Marvel, and Pixar. We have to remember that on top of the stock/cash figures being bandied about there’s also an assumption of debt as well, which is in the $12 billion range for Fox. Plus, Roberts isn’t wrong to argue a Fox-Disney will command 50% of the theatrical market, which should concern the DOJ (although after Time Warner, who the hell knows what the courts will do even if DOJ brings suit).

      1. Oh…some really interesting extra-information there. I knew that the whole relationship between Disney and Pixar was a mess in this period, but I didn’t knew that.

        I wouldn’t underestimate Iger, though. I wouldn’t put it past him to let Comcast outbid him, take the money for the broken contract, lean back and watch the Comcast stockholder voting the deal down (because they would seriously indebt themselves with the purchase) and then try again.

        The whole argument of Roberts is phoney…he is using the box office numbers and he is correct there, but in terms of movies getting released overall, Disney and Fox together match the comcast releases through Universal, Dreamworks aso. And it is at the end of the day the choice of the audience whose releases they want to watch, because the theatres will pick above all whatever the audience is interested in. Honestly, Disney only needs a few flops and Universal some successes and then they are controlling half of the market – without the merger.

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