Kevin Mayer, Walt Disney Co.’s longtime strategy chief, is moving from behind the scenes to a starring role.
The world’s largest entertainment company created a new division Wednesday, putting the 55-year-old executive in charge of businesses that may determine the future of one of America’s best-known consumer brands. Mayer, who previously weighed acquisitions for Disney, will be responsible for executing the company’s shift from traditional TV to on-demand viewing.
“Wall Street likes Kevin,” said Laura Martin, an analyst at Needham & Co. “He’s proven himself to be a visionary, of not being afraid of taking risk. Giving him these assets is a worthy experiment.”
Chief Executive Officer Robert Iger handed Mayer a portfolio that includes the company’s investment in the Hulu streaming service, its international TV networks, as well as all program and advertising sales for ABC, ESPN and other channels. He also expanded the role of parks chief Bob Chapek, giving the long-time executive added responsibility for the consumer products business. Both are now potentially in line to succeed Iger in December 2021.
Like Mayer, Chapek’s star is also on the rise, with theme parks reporting record profit last year and billions of dollars more in investments planned. Combining those businesses gives Chapek, 58, a chance to reprise his role atop Disney’s massive merchandising arm, which saw record earnings under his direction four years ago.
While Chapek already held a high-profile position within the company, Mayer’s job has been much less visible. A mechanical engineer with a degree from the Massachusetts Institute of Technology and an MBA from Harvard University, Mayer joined Disney in the strategic planning department in 1993. He supervised the company’s online businesses including the troubled Go.com Internet portal in the late 1990s before jumping to lead the digital arm of Playboy Enterprises Inc. in 2000 and later to Clear Channel Interactive.
Consulting work followed, until Mayer came back to Disney’s strategic planning unit in 2005.
It was critical year. Iger took over, and Mayer worked with the new CEO on one of his first big moves, the $7.4 billion acquisition of Pixar. The deal for the Steve Jobs-controlled studio reinvigorated Disney’s animation business, thanks to hits such as “Cars” and “Finding Nemo.” More importantly, the purchase helped Iger and Mayer craft a strategy of focusing the studio on film franchises — brands and characters with global appeal and merchandise potential.
Soon after, the Miramax art-house film division was sold and Disney acquired Marvel and Lucasfilm, gaining the superhero and “Star Wars” pictures that have dominated the box office in recent years.
Not all of Disney deals worked as well as those. Mayer also did the analysis for Disney’s acquisition of Maker Studios, a web video business, and Playdom, a maker of online games. At a conference last month for the technology news site Recode, Mayer said both were learning experiences. Playdom’s model fell apart, he noted, when Facebook Inc. stopped promoting the company’s games.
“It’s obvious in hindsight,” Mayer said. “You don’t want to be dependent on someone else’s algorithm.”
Since then, Disney has embarked on a strategy to control both content and the platforms used to distribute movies and TV shows to consumers. In the past two years, and under Mayer’s direction, Disney spent $2.6 billion to acquire the majority of BamTech, the streaming arm of Major League Baseball. It will now serve as the base from which the company introduces its new streaming services.
Last August, Disney said it will stop selling movies to Netflix Inc. and instead offer ESPN sports programming and family films directly to consumers via two new streaming services. Both will be under Mayer.
Mayer also helped orchestrate the $52.4 billion agreement to acquire most of the entertainment assets of 21st Century Fox Inc., missing the premiere of the latest “Star Wars” film during the negotiations for that deal. Should the merger close, Fox’s online and international assets, including the Sky Plc European pay-TV business, will be folded into Mayer’s division.
Bruce Stein, CEO of the esports business aXiomatic, got a taste of Mayer’s style when he approached Disney two years ago about developing video-game-related consumer products. Mayer and his team expanded the scope of what they were working on, with Disney ultimately making an investment in Stein’s company and collaborating on multiple projects.
“He has that rare balance of vision and execution,” Stein said. “That’s his skill, being able to understand where you are and if Disney can help.”