One of the most powerful executives in the media was meeting with a group of people the morning of June 9 when he heard the news that Disney CEO Bob Chapek had abruptly fired chairman of entertainment and programming Peter Rice.
“Chapek just made another massive mistake,” this exec announced. The market may have agreed: Disney stock fell nearly 4 percent as the news became public, a larger decline than the market as a whole on Thursday.
Chapek’s decision to fire a long-standing and well-respected executive in the most unceremonious possible manner set off waves of bafflement and, for many, outrage – from the uppermost circles of Hollywood power to lower-echelon players. “There are very few things that stun me,” says another one of the industry’s most seasoned executives. “This stuns me.”
Several insiders tell The Hollywood Reporter that the firing was another in a string of Chapek missteps, from Disney’s legal clash with Scarlett Johansson to the damaging flip-flop on Florida’s so-called “Don’t Say Gay” law. “Chapek has chosen another negative news cycle when he was just getting his feet back on the ground,” says a longtime communications exec.
Also receiving negative reviews was the statement of the board’s “confidence and support” for Chapek from chairwoman Susan Arnold. Some high-level executives at other companies said the board has already sent a message of something less than full confidence by failing, so far, to renew Chapek’s contract with only months left before it expires. “You let the CEO get within a year of his contract being up,” says one longtime industry power player. “That by itself is a statement of non-support. A vote of confidence is nonsense. It is the most Mickey Mouse company. It’s so dysfunctional. ”
Some speculate that the board might now extend Chapek’s contract at an upcoming meeting. But once again, there were negative comparisons with former Disney chairman and CEO Bob Iger. “Can you imagine when Bob Iger fired Anne Sweeney [the former president of Disney/ABC Television Group] that the board would issue a statement? ” says an observer with previous connections to Disney.
Meanwhile, many Disney insiders reacted to the news with horror. “It’s horrendous,” says one. “It’s not good for the company. Morality is terrible. ” Another adds: “I wonder if Chapek has even been aware that Rice held Zoom town halls and Q&A throughout the pandemic that really made him a presence in the lives of us rank-and-file schlubs.”
It was not merely the dismissal of Rice but the manner in which it was done that fueled the outrage. “By firing the guy this way, everyone else says,‘ Is this what he’ll do to me? ’” Says a high-level executive at a Disney competitor. Notes a source with ties to the company: “At Disney, at that level, you don’t treat [an executive] that way. You give him a production deal, you give him a cover story, you give him a party, you walk them out the door. If you have to execute someone there are ways to do it. It’s the lack of touch. It’s like this guy [Chapek] doesn’t know how things are done in our town. ” (Sweeney, for example, was allowed to announce her own departure in 2014, months ahead of her official exit, saying she wanted to get more involved in the creative side of the business. And, just days ago, Warner Bros. Discovery chief David Zaslav ushered out Toby Emmerich at Warner Bros. with a soft landing production deal.)
While Chapek is said to have cited a poor cultural fit in his brief meeting to terminate Rice, no explanation of that was forthcoming from Disney and sources say Rice was given none in his meeting with Chapek. Many speculated that Chapek was reacting to the idea that Rice, who has had a long career in film and television, could have been seen as a successor – and might have been viewed as positioning himself that way. Says a top industry executive: “My theory is Chapek thought,‘ This guy’s trying to take me out. Fuck him. ‘”(It may be worth noting that when Disney was embroidered in a backlash over its response to Florida law, Rice had issued his own memo saying,“ Personally, I see this law as a violation of fundamental human rights. ”)
Says the source with ties to Disney: “During all the press about the [Ron] DeSantis fiasco, it’s incredibly uncomfortable, for a CEO whose power is slipping away, to have the person who is seen as your successor sitting in the room with you. You kill that person. ” It would not be a new phenomenon at Disney: Iger dispatched COO Tom Staggs in 2016 when Staggs was widely seen as Iger’s successor, and Michael Eisner abruptly ousted Jeffrey Katzenberg, who was pressing for assurances that he was next in line, in 1994.