3 Nasty Surprises Waiting for Disney CEO Bob Iger in 2023

[Disney4me]

Surprises — they can be full of joy (like a surprise ride reopening) or riddled with stress. While 2023 may hold many wonderful surprises for Disney fans and Disney’s own CEO, it is shaping up to be a year with some NASTY surprises too.

©Reuters | Disney CEO Bob Iger

Since assuming the role (again) in November of 2022, Bob Iger has had to come to terms with the fact that Disney simply is not the same way he left it. And thanks to serious battles with Florida politicians and complications with Disney’s Board of Directors, some unpleasant surprises could await him later this year. So today we’re breaking down just 3 of the worst surprises that Iger may have to face within the upcoming months.

A Battle for the “Future of Disney”

We begin with a scenario that has only recently become a real issue for the Company and one which a reporter said could lead to Iger’s “fight for the future of Disney.” We’re talking about the proxy battle situation that stems from the Trian Group and Nelson Peltz.

Basically, Peltz is the CEO and Founding Partner of Trian Partners. Trian is a multi-billion dollar investment firm and they are considered to be an activist investor group. Trian owns about 9.4 million common shares in Disney. That’s valued at around $900 million.

©CNBC

Peltz and Trian have criticized the Disney Company for several things, including what they feel are issues with corporate governance (and executive compensation), the direct-to-consumer strategy when it comes to Disney+ and Hulu, and accountability with capital allocation.

Peltz has shared that he feels Disney is over-earning at the theme parks to make up for losses in streaming. Peltz has also called on Disney to buy all of Hulu or get out of streaming entirely, and Trian has shared its view that Disney has “over-the-top compensation practices.”

©Trian Partners

So what happened? Well, things started small with Peltz reaching out to indicate that he could be helpful if placed on the Board. Along the way, an employee and shareholder of Disney got involved, advocating on Peltz’s behalf. Peltz held several meetings with Disney executives expressing his desire to be on the Board. Things got serious as Peltz reportedly expressed that Trian Group would nominate a separate slate of nominees at the Annual Meeting of shareholders in 2023 unless Disney agreed to give Peltz a seat on the Board.

That was later repeated, with Peltz indicating that he would run a proxy contest if not added to the Board. Disney ultimately determined that they would not offer Peltz a seat on the Board since Peltz did not “provide any actionable ideas for Disney other than his Board candidacy.” Plus, Disney felt that he had a lack of “relevant media or technology industry experience.”

©Reuters

Peltz has since informed Iger himself that, if not given a seat on the Board, he would mount a proxy fight that would “challenge Mr. Iger’s legacy,” according to Disney’s own reports of the situation. Though Peltz made a presentation to get a seat, he was ultimately denied. That leads us to the present day.

Train Group has released a press release about their nominees for the Board and is mounting a proxy battle, attempting to get shareholders to vote in a way that would support their nominees. Meantime, Disney has filed various documents defending Iger and his success with the Company, explaining why (in their opinion) they feel that Peltz is NOT qualified for the Board, and urging shareholders to NOT vote for Peltz/Trian Group’s nominees.

©Disney

What will the future hold? How will shareholders vote? Will they side with Trian Group and Nelson Peltz? Or will they vote into office Disney’s own recommended individuals? Much remains to be seen as the battle continues. The vote could result in a wonderful outcome for Disney’s own desires or a nasty surprise for Iger, but it does seem they are at least gearing up for battle by issuing statements against Peltz and his desire to get a spot on the Board.

Thus far, the Annual Shareholder meeting date has not been revealed, but it was held on March 9th in 2022, so we expect it could be held during a similar time this year.

©Disney

For more about the Nelson Peltz and Trian Group drama, see the posts below:

• The Big Disney Parks Changes that Activist Investors Are Pushing
• Who Is Nelson Peltz and Why Do People Care What He Says About Disney?
• Dwayne “The Rock” Johnson Comments on Bob Iger’s “Fight for the Future of Disney”
• Disney Pushes Back Against Activist Investor and Defends CEO Bob Iger
• Activist Group Believes Disney Has “Lost Its Way” and Pushes for Board Changes

Stay tuned for all of the latest updates.

See the Full Timeline for Chapek’s Exit, Iger’s Return, and Disney’s Recent Corporate Battles

Pressures to Keep Up With Universal

Disney is working on several new theme park projects, but it isn’t the only one. For years Disney has competed in a big way with Universal’s theme parks in Hollywood and Orlando, but 2023 (and other years down the line) could prove to be particularly challenging for Disney in terms of “keeping up” with Universal’s level of development.

For starters, a brand new LAND will be opening at Universal Studios Hollywood in just a few days — on February 17th, 2023. The land will feature NEW food (including a new Toad-themed restaurant), a brand NEW ride (where guests will battle on a Mario Kart-themed attraction), interactive bands, meet-and-greets, and plenty of merchandise (of course).

©Universal

What does Disney have to compete with this brand NEW land? Well, 2023 will finally see the opening of Journey of Water — Inspired by Moana in EPCOT, but that is a walk-through attraction, not a moving ride. TRON Lightcycle / Run will also finally open in Magic Kingdom after being in the works for YEARS (and severely delayed). 2023 will also bring a few new restaurants to Disney World (including Roundup Rodeo in Disney’s Hollywood Studios) and the opening of the rest of Future World in EPCOT (with Festival spaces and a Walt Disney statue).

But are these restaurants, experiences, and attractions, which are spread out throughout the parks and resorts enough to really excite and draw in visitors in the same way as the introduction of an entirely new land? Maybe…or maybe not.

Journey of Water Construction

Sure, Disney has more projects in the works beyond 2023 — like Tiana’s Bayou Adventure (the Splash Mountain re-theme). And it has teased potential new lands for Disney World — like a Zootopia land at Animal Kingdom or villains land in Magic Kingdom. But none of those “teased” projects have been fully confirmed.

In the meantime, Universal has already revealed plans for a brand NEW theme park coming to Orlando in 2025 — Epic Universe — which will also feature a Super Nintendo Land and much more. And Universal has revealed its plans for a NEW theme park experience in Texas and a year-round horror experience in Las Vegas.

©Universal | Epic Universe Concept Art

Couple that with Universal’s support for an extension of the SunRail commuter train service in Orlando, and you’ve got a lot of matters to deal with. According to FOX 35 News, this extension would ultimately link the Orange County Convention Center, the International Drive tourism district, and the Orlando International Airport to SunRail’s existing line. The Orange County Convention Center station would be near Universal’s new Epic Universe park. And this extension could connect residents and visitors to the Brightline train, which could pass through Orlando by utilizing some of the SunRail’s existing line under the Sunshine Corridor plan.

This all comes after it was announced that Disney had backed out of the plans to have a Brightline train station in Disney Springs (as previously announced). Still, plans for a station “near” Disney World, serviced either by SunRail, Brightline, or both, is reportedly still in the works.

©Brightline

A new land in Hollywood, an entirely new park in Orlando, a new experience in Las Vegas, and a new experience in Texas. Plus a new Minions-themed attraction in Orlando and other changes. Universal is working on a LOT.

Again, that’s not to say Disney isn’t working on a lot of things too. But many appear to be behind-the-scenes or unconfirmed at this time. Yes, we know an updated treehouse experience is coming to Disneyland, the revamped Mickey’s Toontown and Mickey & Minnie’s Runaway Railway will open in 2023, and a new expansion is coming to Avengers Campus (at some point in the future) which will take it into the multiverse. But will Disney’s projects be able to compete with Universal’s in 2023 and the immediate years that follow?

Model of Mickey & Minnie’s Runaway Railway

Is there just a lack of enough confirmed plans to excite fans? Are Disney’s plans simply moving forward too slowly to compete with other parks? Will things like SunRail or Brightline stations or other developments leave Disney in the dust as others push forward? Only time will tell, but some less-than-ideal surprises may be in store for Iger if Disney cannot “keep up,” at least in the eyes of some or many fans.

Click here to learn about the BIG changes coming to Disney World in 2023

Reedy Creek Improvement District Drama

And finally, we reach one area with a high level of uncertainty at this time — the Reedy Creek Improvement District’s impending dissolution. Here’s the quick 101: following Disney’s stronger statements in opposition to Florida’s Parental Rights in Education Act (what critics call the “Don’t Say Gay” act), Florida legislators and the Florida Governor passed/signed a law that will dissolve Disney’s Reedy Creek Improvement District (RCID) in June of 2023 in what many saw as an act of retaliation.

©WFTV 9

The RCID was created over 50 years ago and is a special taxing district. Essentially, the RCID functions as its own county government with a board selected by the landowners — the majority landowner in the RCID is Disney itself. This district system has allowed Disney to have a great amount of control over the land on which it operates in Orlando, allowing it to issue bonds to pay for certain things, control building codes, and approve certain things it likely could not have gotten approved by other counties.

The system has also benefitted local counties by alleviating them of the burden of having to shoulder the financial costs of several things for the property on which Disney operates, like emergency services or sewer services.

Reedy Creek Trash Cans

Some have suggested that the RCID would be recreated and still give Disney most of the powers they were used to having, making only certain changes to give Florida Governor Ron DeSantis the appearance of a “win.” But DeSantis’ office seems to differ, indicating that stronger changes would be made, stripping Disney of more of its powers, potentially changing (in a significant way) how the District (and Disney) has operated (in terms of power over decisions that impact its parks and operations).

Some had suggested that Iger’s return would smooth things over with Florida politicians and DeSantis on the matter, but that has yet to fully materialize. While Iger said he was sorry to see Disney “dragged” into these political battles, DeSantis insisted that Disney went willingly and “brought this on themselves.”

Florida Governor Ron DeSantis ©Deadline

What exactly will happen remains to be seen. DeSantis’ office has filed a notice of the legislation they intend to seek on Reedy Creek. This would include features that increase “state oversight, accountability, and transparency of the District” while also “revising the selection process, membership qualifications, and compensation for the governing body of the District.”

The legislation also seeks to revise authority when it comes to local permitting and regulation, and more. These could result in some significant changes to Disney’s “normal” way of operating in Florida. And it seems they may be taking steps to prepare for that.

Disney World Entrance

The next regular session of the Florida legislature will begin on March 7th, though special sessions before that could address this situation. Will Iger be able to strike a deal with politicians to re-establish Disney’s RCID with most of the same powers but still give politicians some of the oversight they want? Only time will tell, but again there could be some good or some terrible surprises in store for Disney.

Click here to see the latest on the Reedy Creek situation

And that’s our look at just 3 nasty surprises that could await Bob Iger in 2023. What challenges do you think Iger will face? Tell us in the comments.

For more analysis related to Iger’s return as CEO and the current status of the Walt Disney Company, see our posts below:

• How Important Is Disney’s Relationship with Ron DeSantis for the Future of the Parks?
• New Disney Chairman Will Lead a “Succession Planning Committee” To Find Bob Iger’s Replacement
• 4 Important Secrets You Didn’t Know About the Iger-Chapek Conflict
• “Time Is Ticking” on CEO Bob Iger at The Walt Disney Company
• Every Major Change Since Bob Iger Returned as Disney’s CEO
• 7 Big Challenges Bob Iger Will Face as Disney’s New CEO
• Bob Iger Is Back at Disney. Here’s What Can Change (and What Won’t).

And stay tuned for more news!

Click here to see why Bob Iger’s mistakes would have “killed any other CEO”

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What other nasty surprises do you think could be in store for Iger in 2023? Tell us in the comments.

The post 3 Nasty Surprises Waiting for Disney CEO Bob Iger in 2023 first appeared on the disney food blog.

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