Disney Entertainment’s Dana Walden on Media Mergers, Jimmy Kimmel and What Makes Good TV

0:00Get the news you need in just 15 minutes. Start your day with Bloomberg Daybreak, the podcast with a global view on the stories that matter. I'm Nathan Hager. And I'm Karen Moscow. Join us each morning for curated stories on current events, politics, business and foreign relations. Plus one conversation on the day's biggest developments all in just 15 minutes. Subscribe to Bloomberg Daybreak for a precise, thoughtful take on the stories that matter. Listen to Bloomberg Daybreak each morning on Apple, Spotify or anywhere you listen. I'm Emily Chang, and you're listening to The Circuit. On this episode, we're taking you behind the scenes at Disney headquarters to meet Dana Walden, Disney's co-chair of entertainment.

0:40She's a longtime TV hitmaker with, some might say, the magic touch, who currently oversees one of the largest creative portfolios in the world, between Hulu, Disney +, FX, and ABC. She also happens to be a contender for the top job at Disney, when CEO Bob Iger steps down next year. Walden is widely seen as one of Hollywood's savviest executives with a powerful web of relationships with some of the most famous stars and showrunners. What's your approach to talent, especially when you have to say no? In a lot of cases, a fast no is the second best thing to a yes because it enables great partners to move on and find the thing that is going to be explosive and can be a big hit.

1:24But even veterans like Walden are facing challenges in the rapidly shifting business of media. There's the ongoing streaming wars, consolidation in Hollywood, the rise of AI, and a very heated conflict involving President Trump and late-night host Jimmy Kimmel, just to name a few. Did President Trump call you or Bob or vice versa? Did you get any pressure from the White House? He did not. We did not hear from them. We talked about Disney's controversial call to suspend Kimmel, then reinstate him, A decision made by Walden and Iger. As well as what makes a good TV show. And so much more in a sit-down at the famed Team Disney building in Burbank, California.

2:03That's where she, Iger, and other Disney lieutenants are overseeing the fate and future of one of the world's most powerful and beloved media companies. Let's roll sound, please. Hi. Wow. This is very serious and professional. How long have you been in this office? Has this been your spot since 2019? I've been all over. It's kind of crazy. I started out in that building. Okay. Because when I first got here, I oversaw a lot of the linear channels. And then I was doing Hulu Originals too, but ABC is based there. That is the ABC building. Okay. The green one? Yeah. Okay. And then I moved into this building in an office across this floor.

2:48and then I moved here a couple years ago. Okay. Which I like. Yeah, and who's, I said, Christina's on this floor. Who else is on this floor? Christina's here. Hugh Johnston, our CEO, is here. Ellen Bergman, who's my partner, is here. Orazio Gutierrez, our general counsel, is here. Yeah. And then Bob is right there. Right there, through that door? Yeah, his outer area. Yeah, yeah, yeah. Nice. So we're heading into the holidays. Is this a busy time for you? It's so crazy. It's so crazy. We have so many things. It's such an important time in the business. And then it's an important time to try to be with your family, as I'm sure you know.

3:23And I am definitely, notwithstanding work pressures, I am the gift picker. I am the gift buyer. If we have a holiday card, it's because I'm sending it. I used to sit in my driveway and my family would be having dinner in the dining room, was right next to the windows when you drove in the door. And they would see me just sitting there. And I'd just be taking some breaths, trying to make the transition. And my younger daughter would come out and she'd knock on. And she'd say, we see you. We know you're here. So is it nice to be on the floor with all the executives? Do you gather and chit chat? It is.

4:00I'm, you know, I wish I was closer to my teams. You know, I love spending time with them and they all come over here and I'll go to their offices. But having the opportunity to go into any of the smart executives I work with in the C-suite here and get a point of view about something I'm doing. It's really great. I pinch myself every day. I drive on this lot and think, I can't believe I get to work here. I did a show with Bob like 10 years ago, right out front. It was called Inside Disney. That was 10 years ago. And here we are 10, 10-ish. So just wanted to do a little bit of background. You grew up in LA.

4:36I did. What drew you to Hollywood? Well, it's actually funny. I grew up about four miles from here. I always say this job was like the pull of the valley back to this exact spot. I had a great upbringing. My mom was in musical theater. She was a performer and she really taught me to love a great story. Took me to see movies and theater. And we watched a lot of TV together as a family. And then I remember when I was 12, my parents switched out the TV in the living room and got a new one. And I somehow convinced my mother to let me put the old one in my room. I didn't come out for about five years.

5:17I think she regrets that choice now, but it put me on this path. Well, your brain didn't turn to mush. I mean, it worked. It's true. And your grandfather gave you Disney shares. Yes. My grandparents loved Disneyland. They took us every summer. They lived in Vancouver and they would come down during the summer and we would all go as a family. It was really a memorable time. And then when I turned, I don't know, 10 or 11, my grandfather, who really considered himself a businessman first, he thought about who runs the best businesses. We were always talking about it. He was trying to impart upon me, you know, what the virtues are of a strong business.

5:56And all of a sudden they would bring down over Christmas, five shares of Disney stock for Christmas. And I have to say when I was 10, I did not think it was the best gift. Although every certificate, which it still does today, had the iconic characters on it. So very special. Did you hold on to it? I did. I held on to a lot just because they had sentimental value to me, not just that I was looking at the value of the gift. You landed a PR job at 20th Century Fox. I did. 1992, that was. And that's where you had your famous Jerry Maguire moment. Yes. Tell me about that. Much has been made of that.

6:35I think maybe it's taken on a life of its own. But I got to Fox, as you said, ended up spending 26 years there, was at a retreat and made a presentation in front of Peter Chernin, who was at the time chairman of Fox Entertainment. And I don't know what happened. You know, he was impressed with a few of us in that room. And he just pursued a conversation with me afterwards, just trying to understand what my passion was. And notwithstanding that I came in on the PR side, I really had a passion for storytelling and creativity. And I remember him saying, why don't we move you over into that area? And it was a really unique opportunity.

7:19I was not such a high level executive. You know, I took a step back and moved into an area which I didn't understand very well at the time. But I had amazing mentors who taught me, along with some of the creators that I was working with at the time, Chris Carter on The X-Files, you know, Jim Brooks on The Simpsons. They really taught me how to understand storytelling and production. And it was a wonderful period in my career. And it led to, again, a 26-year career at Fox where I was given so many opportunities. I oversaw different businesses, consumer products, domestic distribution, the broadcast network at Fox.

8:06But my heart was really always with our television studios and working with creators like Jim Brooks on, I think, many of the best television shows in the history of the medium, shows like The X-Files or 24, The Simpsons, Family Guy, Glee, American Horror Story, The Americans, Homeland. I mean, the list really went on and on. And it was just a wonderful, wonderful time in my career. You took Fox from fourth to first with shows like Glee and 24. What are the strategic decisions that you made that you think made the biggest difference? So, you know, when I got into the Fox network, the network business at the time was pretty cyclical.

8:49You know, you would ride a wave and have incredible programming that would hit the zeitgeist and be number one. And then those shows would get, you know, a little bit long in the tooth and another network would come up and have the hot new show. And I came in at the unfortunate time as Fox was on its way down to number four in entertainment. And really, we put it back together and got back to number one, Brick by Brick. It was with shows at the time we had Empire. And then I convinced my best friend Ryan Murphy to do a show called 9-1-1. That was a huge global success. And out of that came a spinoff, 9-1-1 Lone Star.

9:33And then we launched The Masked Singer, which was such a big, noisy, kind of audacious reality show. And just piece by piece, we put that schedule back together. And at the point that I left, which was 2018, it was back in the number one spot. So Netflix kicks off the streaming boom. It takes Disney six years to get into streaming, launches Disney Plus in 2019, buys Fox to try to catch up. That's when you enter the scene. Did you feel like you were starting from behind? I didn't really. At the time, I thought, what an amazing opportunity to join a company which is the gold standard in storytelling.

10:13That's been my passion. That's where I've spent the majority of my time is just stories which endure, stories that matter. I think that was one of the reasons that Bob was so interested in acquiring those Fox assets, because we had many, many seasons of the types of shows that built the foundation of Netflix subscriber base. So I felt like we had the right tools combined with, of course, the iconic Disney IP, which is a total differentiator. It is available nowhere else. It is special and it means something for generations of people. And I thought we had a lot of solid tools. And we weren't really starting from all the way behind.

11:02We had been partners in Hulu. is that we had a streaming service that was incredibly well-subscribed in the U.S. And Disney Plus launched with, I think, 10 million subscribers in the first 24 hours. So we did not feel by any stretch that we were behind. So you oversee now one of the largest creative portfolios in the world between Hulu and Disney Plus and FX and ABC. how do you see all these pieces fitting together inside the Disney universe? And what do you see as the balance between streaming and legacy sitcoms and linear and broadcast? Well, that's a very broad question. I would say in terms of streaming, I have a partner who oversees Disney Plus and Hulu with me, Alan Bergman.

11:50He oversees the Disney feature business and Star Wars, Marvel and Pixar and Walt Disney Animation. So he oversees the branded pieces. I oversee the branded for kids. And then I oversee the general entertainment, which includes shows like The Simpsons and Family Guy. And I would say our strategy is we want to create someone's very favorite show. And we have such a vast array of stories and they are so well executed. And while there's a very big difference between our branded shows, the iconic content, Mickey, Minnie, you know, the princesses and what we're doing on the general entertainment side with Shogun or the bear or the Kardashians.

12:41The consistent thread, though, is incredible high quality. we are never in the business of doing the most stories. We want to do the best stories and be a place where we're a trusted environment for parents. Our shows have appealed, our stories have appealed to kids for 100 years. And then we also want to make it easy for subscribers to find a great story like Grey's Anatomy, right? Which leads to the question of our linear channels. And when we think about our distribution ecosystem, we think about it as an integrated television business or an integrated entertainment business. The types of shows that we get from broadcast are shows that have not been built on streaming.

13:32They are also unique. You think about, you know, Grey's Anatomy or High Potential, those long running multiple episodes. You can do a deep dive into a long running series where you love the characters. They become part of your group every day. You think about those characters because there's so much content to satisfy you. And that's a type of programming that uniquely comes from our broadcast network, ABC, or Dancing with the Stars. You know, live is really a specialty of linear and of broadcast television. And Dancing with the Stars is up something incredible, like 60 % this season. I saw that.

14:16And I think that's a combination of we're simulcasting it across our streaming services and ABC. Younger subscribers are watching it on Disney+. The original fans are watching it on ABC. And together, we're serving fans wherever they want to watch our shows. Yeah. I've spoken to a few people now who rave about the art of Dana Walden. I've read about you getting up early to watch cuts on a treadmill. What's your approach to talent, especially when you have to say no? Well, saying no is very hard. You know, these are people who I not only respect, but I care about. And there is no one strategy. I think strong partnerships and relationships that you invest in over time where your partners believe that you are in it with them enable you to have conversations in an authentic and trusting way.

15:19where, for example, I was actually just talking to Kelly Ripa about this. In a lot of cases, a fast no is the second best thing to a yes, because it enables great partners to move on and find the thing that is going to be explosive and can be a big hit. And while, you know, these decisions are a bit subjective, The decisions that our teams are making are based on decades and decades of experience. And the more transparent we can be with partners, I think the more resilient the partnerships are. The competition is fierce. Between Netflix and Apple and Amazon and YouTube, Netflix is arguably the one to chase.

16:06How are you different from Netflix? And where do you see similarities in the playbook? Well, it's very clear Netflix has done an extraordinary job and they really have developed into a utility, right? They, in many situations, you know, that is the place you go when you don't know what you want to watch, but you're going to watch TV. They did that very successfully. The difference is, I think, with Disney, there's an emotional connection. There's a, I have to see that show. I want to see that film. I've been waiting to see Moana 2 and it just hit Disney Plus, or I've heard so much about Shogun and I have to check it out.

16:53While we are not the same type of utility, I think there is an emotional connection that Disney has with fans. And I would say that's a huge asset for us as we continue to build out our streaming services. Would you say there's a difference in terms of quality versus quantity as well? Oh, no question. No question. We've never been in the quantity. You know, we're not trying to create a fire hose of content. We're trying to curate. And we think that now and into the future, there will be a great benefit to subscribers in feeling like a team is curating the best shows and they don't have to go searching for whatever that might be.

17:43That said, Netflix shares are up 80 times. Since the start of streaming, Disney shares have about doubled. Netflix's market cap is about twice the size of Disney now. What's your message to investors? Well, I think, again, there can be both services can coexist. And I think we keep making quarterly gains, both in terms of revenue, NOI, in terms of subscribers and engagement. We're delivering on all the important metrics. And that's happening, being true to ourselves, being authentic and also offering the best storytelling, I think. You know, in the industry, you know, regardless of who I talk to, whether it's someone at a big tech company or someone at a traditional media company, inevitably, well, if you're in tech, you want to talk about Star Wars.

18:35But you want to talk about one of our beloved pieces of IP. It is, again, the pull of a Disney story is tremendous. And I think we have an ability to optimize content around our company in a way that none other does. When you think about the wonderful stories that we tell that are now distributed through Disney Plus and then how they come to life in our parks, on our cruise ships, at retail and consumer products, that is completely unique to Disney. and we see our competitors try to replicate that, let's call it a flywheel, and it's virtually impossible to start from scratch, and it's also really difficult to do it without that IP.

19:23The streaming boom has slowed. It seems like there's less getting made. Studios keep going back to established showrunners. How would you describe this moment in time in Hollywood? Well, I think we've been in transition for over a decade. I think most of us who grew up in the old Hollywood system have become very resilient and very accustomed to change. And we are pivoting. We've recently hired a new technology team of incredible engineers and product design executives who have come from best-in-class technology companies, from YouTube and Google and Meta. and the progress we're making on that front is very encouraging.

20:09And you have to keep moving forward. And you have to look at the strength that you bring to this particular moment in our business and really lay into the unique assets of each company. And for us, that means designing product features that lean uniquely into the IP of the Walt Disney Company. Now, some of the critics would say that Disney entertainment is in a tough spot. Your share of streaming is plateauing. Profits have underperformed estimates. How do you see it? And what are you doing to shift that? Well, I don't know. I think it depends on, you know, what moment in time. We are growing all of those important metrics.

20:52I'm not sure, and I can't speak to whether expectations keep being set beyond where we're delivering, but the growth is there. And that's what we're focused on, which is growing, making very interesting partnerships around the world with local broadcasters, which is Disney comes as a friend to the creative community. We want to keep the ecosystem of creators of distribution in each of the markets where we operate strong. And we think we can be an asset to them, a partner and also that we can coexist. And that is not the strategy of all streaming services. So we've been met with incredible optimism in throughout EMEA.

21:37I'm so sorry. No, no, no, no. Same. I'm like... This is the residual cold. I feel like even if I don't have a cold, especially when I need to be on, it just like Like sits in there and it's like, hello, I'm just in your throat. Yes. Yeah. So again, in each of the markets, each of our priority markets, we've had local originals, which are hits now that helps to inform our strategy going forward, which also help us to expand our reach and to offer a greater amount of content at a comparable price. There's also this perception that with everything that is Disney, quote unquote, quote, now with the stuff you've bought, the stuff you made, that the Disney brand itself has been diluted.

22:23How do you respond to that? What is Disney's DNA? Yes, well, I would have to dispute that. I think that's not really fair. I think when you think about the global box office over the past couple of years with Inside Out 2 and Moana 2, Zootopia 2 about to be launched, the recent past with Encanto and Coco and the diversity of content, And I think that this company is judged very harshly because people have very high expectations because they love it. And that connection, that love, whether it's our programming for kids, where we know how important that programming is. You and I were discussing it earlier.

23:07when kids connect to our stories, they develop a lifelong connection and affinity for our brand and our characters, which is unlike any other company. We have the top three kids shows in streaming in the U.S. right now. And each of them sort of illustrates what our strategy is, which is you have the original canon of characters, Mickey, who's about to be 100 years old, and has been refreshed a number of times throughout that period and continues to stay beloved generation to generation. So Mickey Mouse Clubhouse or Mickey Mouse Clubhouse Plus. Then we're also developing shows based on Marvel characters like Spidey and his amazing friends, the Avengers, Iron Man, Young Jedi from Star Wars.

23:59Again, that is helping our youngest fans develop a connection to those characters in a delightful way with shows that are optimistic, aspirational. They're so joyful and parents trust us with their kids, which is, again, a very unique phenomenon. And then along with our iconic IP, we're always looking for original series for kids that share those attributes. And there's no better example than Bluey. It is a global phenomenon, as it should be. It's a brilliant show, but it, again, it feels like Disney IP. Bluey and her family will be walk-around characters in our domestic parks on our cruise ships.

24:47In 2027, we'll be releasing a Bluey film, and it is excellent. I have seen a sneak peek. It's so good. But what I would say is I just dispute the notion because I see the facts. I mean,$4 billion at the global box office right now, significantly ahead of any other theatrical company. and the most streamed shows in the U.S., both in terms of our general entertainment, Grey's Anatomy, Family Guy, Bob's Burgers, The Simpsons, as well as our kids' programming. So I don't think that's a fair observation. Shogun has turned out to be a huge success, and you're trying to lean into more global and localized content.

25:33Bob Iger said you're taking a disciplined approach to this. Yes. What does that mean? what markets are on the table, what's off the table? Well, Disney Plus is currently in over 150 countries. We are not producing local originals in all of them. We are picking key countries in each of the regions and developing original content there. And it's been a really exciting part of my job, I have to say. Working in this industry for a long time, there was a distribution model where we would take our gems, right, our shows that were huge hits in the U.S., and then we would hand them over to third-party distributors and just kind of hope for the best.

26:15And we would get anecdotal information about whether they worked or didn't work, but we were never boots on the ground really having an understanding of what that consumer wants. And this original content strategy enables us to do that, enables us to understand the value of the Disney IP combined with hit general entertainment shows that feel global like Shogun that you just mentioned or Grey's Anatomy. and then take markets like UK, Germany, Spain, Italy, France, you know, throughout Asia. We have Japan and Korea and then Brazil and Mexico, a focus in Latin America, where we're creating shows that are not just for those countries.

27:04They travel. You know, we know how those shows travel regionally when you get them right. Squid Game and The Crown are major hits. Netflix does seem to be way ahead in this area. Can you catch up? Well, I think you can. I think you just named two shows. So I would put up Shogun and Grey's Anatomy. Those are global hits. They're coming from the U.S., but they work around the world. We had a massive hit in Korea with a show called Moving that signed up millions of subscribers and was the envy of all of our competitors in that region. So absolutely, the value of a hit continues to be very meaningful.

27:50And frankly, each of the streamers has found its way to a couple that can work globally. I don't think that's typically the dynamic. I think the whole reason behind trying to super serve, trying to give these services local flair, is about content that feels very targeted to a certain audience. But when you get it right, the fact that that can be a global sensation, that's happened for all of us. There's a lot of curiosity about your post-integration plans for Hulu. You do have three separate apps between Hulu and Disney Plus and ESPN. How problematic is it to have three different apps? And is a Disney super app coming?

28:33Well, I don't think it's problematic. I think it's actually hugely beneficial because even in the way we bundle our services today, we really think the best experience is to watch it all together on Disney Plus, which is even currently you can be a subscriber to the Trio bundle or the triple bundle, as Bob calls it. And you can watch the best of ESPN games together with the Hulu General Entertainment and deep library shows along with the iconic Disney IP all together on Disney+. Ultimately, being able to continue to advance that UI and making sure that Disney Plus is a place where if you're a Hulu dominant subscriber, you love opening the Disney Plus app and watching that type of show there.

29:25If you're coming in predominantly for ESPN, you open the app and the environment feels like it is personalized and specific to you. And that is the direction we're moving because we think ultimately it's easier. It reduces the friction to be able to access it all in one place. So does that mean a super app is coming? I mean, I know Bob said you're working on some big, significant changes. Yeah. You know what? We're on the path to delivering that experience all in one place. and that is not said to send a message to any Hulu subscribers that they're not going to have the exact type of experience they love.