Is Iger Selling Pixar to Apple
Gargoyles represent the embarrassing side of the Central Intelligence Corporation. Instead of using laptops, they wear their computers on their bodies, broken up into separate modules that hang on the waist, on the back, on the headset. They serve as human surveillance devices, recording everything that happens around them. Nothing looks stupider; these getups are the modern-day equivalent of the slide-rule scabbard or the calculator pouch on the belt, marking the user as belonging to a class that is at once above and far below human society. They are a boon to Hiro because they embody the worst stereotype of the CIC stringer.
Snow Crash – Neal Stephenson
In answer to my own question; No.
Or at least not exactly.
The Hulu Deathstar is in orbit around the Cinderella Castle, it’s powering up its super-mega death rays that are focused with laser-like intensity on Disney. No, it won’t destroy the Rat Kingdom but there is the potential for it to end Bob Iger’s seemingly eternal reign. His position is very dependent on the goodwill of Blackrock and Vanguard’s stake in Disney.
Just to clear up any remaining confusion. Comcast/Universal is exercising the put option it owns on Hulu, meaning Disney has no choice but to buy the remaining 1/3 stake in Hulu. They can’t sell that stake to anyone else, or at least not until after they’ve bought it themselves.
Apparently, both sides have gone into arbitration and according to experts on the subject, it doesn’t look good for Disney.
Disney would have to pay in stock simply because it can’t pay in cash. According to their own documents they barely have enough to cover a few weeks of operating expenses. So it would have to be a stock transfer if Disney pays out 20% of its stock to Universal, Blackrock, and Vanguard’s stakes are negated. Without that key support, Iger will likely fall.
Consequently, Iger needs lots of cash he doesn’t have.
So where to get it?
Marvel Studios was sold to Disney for $4 billion. LucasFilm was sold to Disney for $4.05 billion.
But Pixar was sold to Disney for $7.4 billion and that was in 2006. That equals about $11.14 billion today.
Was Toy’s Life, Cars, and the Incredibles really worth almost 3 times as much as the Avengers and Star Wars?*
No, obviously not. So why did Iger pay so much? Say what you want about Iger and I’ve said plenty, but I’ve never once said the man is stupid. He paid that much because Pixar was worth that much. But not for the movies, it was Renderman that was worth the money.
Renderman is Pixar’s proprietary 3D animation technology. John Lasseter was hired to create shorts that demonstrated what Renderman could do. Pixar Studio was created specifically as an advertisement for Renderman. There was at one point some talk about shutting down the Pixar Studios because it was a distraction from the all-important money maker that was 3D software.
Which brings us to Bob Iger’s little trip to Cupertino yesterday. You don’t need to send Disney’s CEO for a technology demonstrator dog and pony show. Admittedly Apple’s Vision Pro may well be the best of the current crop of VR headsets out there but at $3,500 it’s a rich man’s toy.
And it won’t even be available until next year. So why didn’t Iger just send an actor or someone from Disney’s PR department? Because he had to see Tim Cook himself.
There is no longer any point to keeping Pixar a separate studio. It doesn’t make anywhere near enough money to justify its expenses. However, Disney NEVER sells its intellectual properties, its entire corporate culture is built around keeping and maintaining them. So Buzz, Lightening, and Mister Incredible are staying and will remain under the thumb of Disney.
But technology is a different story.
Now let’s look at Apple. Just as Disney has a death cult built around its founder, Apple is convinced that if it belonged to Steve Jobs, it belongs to Apple. Pixar was his company. They’ve already picked up the talent side of Pixar, or at least the talent side that was worth a crap with its Skydance animation deal. John Lasseter gives Apple the cart but now they need the horse. That’s where Renderman comes in.
Mickey the Franchise Cannibal Rat has a terrible track record when it comes to technology. When they bought Pixar, there was no viable competitor to Renderman. Now there are at least ten. Renderman is still the industry leader but for how long? Disney can not put the capital into it that is needed to keep on top. So why not sell it? Sidenote: I would honestly be shocked if Steve Jobs hadn’t built a right of first refusal into his sale to Disney. So Bob has to ask Tim Cook’s permission to sell it anyway.
Pulling a number out of my butt, I would say that Pixar Renderman is worth about $10 billion in today money. And Iger is desperate for cash.
The one thing that nobody wants is the “talent” that comes with Pixar. They are surprised that Bob Iger has stabbed them in the back after they led an unsuccessful revolt against Chapek that ended up costing Disney the Reedy Creek Improvement District.
They’re actually confused and hurt about this.
Okay, I’m done here.
*Well today, yeah but, I’m talking peak value.
UPDATE: Lasseter is now settling in at Skydance.
