Jane Kuenz has strong feelings about the world of Disney
, and they're not warm and fuzzy.
It seems that somehow over the years, the Magic Kingdom
has cast something
of a disturbing spell over her family. Her parents have visited Disney's theme parks
with unusual frequency, and her sister even got engaged at EuroDisney outside Paris.
"People say it's 'safe,'" said Kuenz, co-author of the book Inside the Mouse: Work and Play at Disney World. "But I found it very strange."
Whatever the characterization, the Walt Disney Company's formula has
succeeded for decades, and there is no intention of changing it at
corporate headquarters just north of Hollywood in Burbank, California. But
as the entertainment monarch ventures beyond its established domain into
the free-wheeling world of cyberspace, Disney faces new challenges in
everything from its internal corporate culture to its international
status as an American family icon.
The empire built by the Disney brothers and maintained by current CEO
Michael Eisner owes much of its success to strict control over its
products, services, and its coveted brand name. At the same time, in going
online, this image-obsessed conglomerate must address the stubborn
perception of the Internet as a haven for illicit activity and sexual deviance.
Even if it succeeds in securing a closed network, Disney must still adapt
to the unpredictable nature and speed of this entrepreneurial-driven industry.
"My guess is that they will go the way they usually go and
try to keep as
much control over it as they can," Kuenz said. "They may be ill-prepared to
deal with the people who do this kind of work, who are used to a lot more
Disney has already encountered its share of protest from conservative
Christian groups who have criticized the company for adopting such policies
as a domestic partner plan that extends spousal benefits to gay couples. On
a different front, the company has been accused of racial insensitivity,
cultural arrogance, and factual manipulation in such films as Aladdin, Pocahontas, and The Hunchback of Notre Dame.
"There is a backlash against Disney. The Christian right is organizing in a
way we have not seen against a media company," said Jonathan Carson, president
of the Family Education Network, a potential Disney competitor that runs an advertiser-supported Web
site with information aimed at education and other issues of importance to
parents. "I don't know whether its presence on the Web will affect its
image, but Disney continues to have PR issues."
Others say these problems would exist regardless of Disney's online plans,
noting that this is not the first time that the media giant has faced
controversy or revolutionary change.
Besides, industry analysts say, Disney is more than willing to take the chance on the occasional hacking because the potential of the online
market is so high. It isn't worried about veteran Netizens who might be
inclined to attack the company technologically or philosophically because
those aren't the people it's targeting anyway.
"What everybody says is that Disney likes to exert control and it won't fly
on the Internet. It's one thing to have an open chat room where anyone can
come in, but how is anybody going to assault a private network?" said Diana
Simeon, an analyst with Jupiter
who specializes in the children's online market.
"Disney's much more interested in the 90 percent not
Internet, who are going to their movies."
Her conclusion is simple: "The bottom line is if they want to be a player,
they'll be a player. They have the resources and the brand name."
Those resources, however, are not as plentiful as they were only a year ago. Disney's finances have been strained by its colossal $19 billion purchase
of Capital Cities/ABC last year. Although the stunning deal raised Disney's profile
as an international media conglomerate transcending its theme parks and
movie holdings to an estimated $36 billion in assets, it also raised the
company's debt to $16 billion, most of it in loans needed for the merger.
Moreover, Disney's leadership has reportedly suffered since the highly publicized departure of Jeffrey Katzenberg from the company's senior ranks last year. The December issue of Vanity Fair released this week contains a scathing account of Disney as a company in serious disarray and mired in internal politics under the stewardship of Michael Ovitz, the super-agent who joined the company as president in a surprising move last year after the death of his widely respected predecessor, Frank Wells.
Such high-powered corporate concerns couldn't have been imagined by Walt Disney and his brother Roy when they started their small film studio in 1923. It was there, in Hollywood, where the first Mickey Mouse cartoon was created, called "Plane Crazy." From those early days through the opening of Disneyland in 1955, the company remained founded on a business model based on the creation of fantasy, and to maintain this
facade, Disney has become almost manic about its public image.
This insistence has led to numerous accounts of the company's controlling
ways. In his 1982 book "Stalking the Nightmare," Harlan Ellison contends
that he was fired on his first day as a writer for Disney Studios after Roy
Disney and other executives overheard him jokingly suggest that the company
make an animated "porn flick." In 1989, Disney demanded that three day care
centers in Hallandale, Florida, remove drawings of Mickey Mouse and other
trademarked characters from their walls, threatening legal action.
In her book, Kuenz writes of stringent rules of at Disney's parks, "a realm
with its own rules and its own language, one that borrows phrase from both
the language of real estate and the language of theater."
In one passage, she wrote, "One Disney spokesperson I talked to refused for
an hour to acknowledge even that there are actual human beings inside the
character costumes: 'That's one of the things I really can't talk about.
Not because I work there, but because it keeps it kind of sacred.'"
It is this kind of stringent culture, according to some who know Disney
well, that may also hamper the company's ability to move with the Tron-like
speed that has become necessary for survival in the high-tech industry.
A telling example of Disney's lack of preparedness for the computer market
made itself known a year ago when it prematurely released an interactive CD
of The Lion King
rife with technical problems that rendered thousands of
discs useless. The situation, which led to reports of children in tears on
Christmas Day, was reportedly exacerbated when panicked parents found the
company's technical support lines closed for the holiday. (Playing off the blockbuster's theme song "Hakuna Matata," industry insiders mockingly referred to the incident as "Hakuna Errata.")
But this lesson, as painful as it was, also serves as a testament to the
company's tenacity and, in particular, the power of Disney's reputation.
For Disney not only recovered from the Christmas failure but also went on
to sell hundreds of thousands more Lion King CDs successfully.
"A company like ours must create an atmosphere in which people feel safe to
fail," CEO Eisner said in a speech at the Executives Club in Chicago
this spring. "If not, people become too cautious. They hunker down...afraid
to speak up, afraid to rock the boat, afraid of being ridiculed."
Then, however, he summed things up in this quintessential Disney way: "Failing is
good as long as it doesn't become a habit."