November-December 1998 – “A brand is a living entity,” Disney CEO Michael Einser says in his new autobiography, Work in Progress, “and it is enriched or undermined cumulatively over time, the product of a thousand small gestures.”

Eisner was referring, of course, to the Disney brand name, and there is little doubt that the Mouse House has been made rich, if not enriched, with Eisner as the Big Cheese. Since he was named CEO of The Walt Disney Company 14 years ago, its financial picture has improved dramatically. Between 1984 and 1997, Disney’s market value increased from $2 billion to $75 billion, with both revenues and net income soaring.

Throughout Work in Progress, Eisner spreads plenty of praise around for others, but it is obvious he considers himself the chief architect of Disney’s resurgence. As CEO and “chief creative officer,” Eisner sees his responsibility as being not only “an advocate for change but also a fierce protector of our brand.”

Eisner’s autobiography avoids Disney controversies that have led to a widening boycott of the company – there is no reference, for example, to Gay Day at Disney, Ellen DeGeneres, or controversial Miramax projects like Priest or Kids.

However, another recent book takes the Mouse to task. In Disney, The Mouse Betrayed, husband-and-wife team Peter and Rochelle Schweizer, both investigative journalists, interviewed those both inside and outside Disney to get a glimpse into the true nature of the company. And that image is not pretty.

Changing Disney’s mission
Even before coming to Disney, Eisner said he knew that the company’s name stood for something. “The name ‘Disney’ promised a certain kind of experience: wholesome family fun appropriate for kids of any age, a high level of excellence in its products, and a predictable set of values.” 

In fact, he said Disney was “not just the premier name in family entertainment but the only true brand name.” Eisner felt Disney was unique in this way, since people felt a sense of loyalty, not just to the Disney products, but to the company itself. That, he said, was a loyalty worth protecting.

Nevertheless, when Eisner first came to Disney, he said the company “had begun to seem awkward, old-fashioned, even a bit directionless.” While Disney’s “underlying qualities” were still there, Eisner said the company needed “to bring back the magic, to dress Disney up in more stylish clothes and expand its reach….”

The key, in Eisner’s mind, was for Disney “to produce films aimed beyond the traditional Disney audience of families and kids.” But since that traditional audience represented the core mission of the company’s founder, Eisner’s change in direction was actually quite radical.

One of those interviewed by the Schweizers was Spencer Craig, a Disney employee for almost 25 years. Craig started with the company in 1971, and by the early 1980s was heading up training for EPCOT at Disney University.

While Craig admits that Eisner increased profits at Disney, he said the CEO subtly changed the company’s mission. Craig’s first taste occured shortly after Eisner came on board, when the CEO had employees remove the Disney motto from their business cards, which had read: “We create the finest in family entertainment.”

Eisner’s new management appeared to want a clean break from the past. “There was a concerted effort [by management] to minimize Walt’s legacy in the company,” Craig said. “You’d hear things [in meetings] like ‘Walt’s not here now.’ And ‘who cares if he rolls over in his grave.’”

This is not simply the perception of a single employee. Disney board member Philip Hawley, who voted to bring Eisner on as CEO, also saw the change. “I thought back in ’84 we needed a change in management,” he told the Schweizers. “But what we ended up getting was a change in company mission. Does the company stand for what it used to? I don’t think so.”

The view of Craig and Hawley seems to be widespread among many at Disney. In a survey of employees at Walt Disney World, for example, The 1997 Cast Excellence Analysis Tool found that 65% of employees disagreed with the statement, “The heritage and traditions of Walt Disney World continue to be valued by our company.”

The artist’s creed
The goal of going beyond mere family entertainment was perhaps most evident in the altered approach to movie-making at Disney. Long the source of clean, fun films for the entire family – in keeping with Walt’s original mission – Eisner brought a more “open-minded” approach.

“In the years since Walt’s death, Disney had become something of a filmmaking backwater,” Eisner said. Lacking the creative instincts of Walt Disney, the company was not attracting new talent.

To reverse this trend, Eisner said it would be necessary to “offer [good writers, directors, producers, and actors] the opportunity to do the projects that most interested them.”

Eisner’s new willingness to push the envelope became clear in 1985, when Disney (Touchstone) decided to produce Down and Out in Beverly Hills. “We were immediately drawn to the project,” he said, “even though we knew that it would almost surely earn an ‘R’ rating – something that Disney, even under its Touchstone label, had never before permitted.”

It was a calculated leap away from the company’s family-oriented past. By producing a movie with foul language and explicit sex, Eisner said, “We sent a message that Disney was prepared to support talented filmmakers and to make movies that dealt frankly with contemporary adult life.”

More importantly, even though Eisner knew producing Down and Out “ran the risk of alienating our core audience,” he was willing to gamble. Eisner scored a win – the movie was a box office success, and it “prompted no backlash” against Disney.

Making money at all costs
For the sake of success at the box office, Eisner has continually demonstrated his willingness to produce controversial films, even when it sacrificed Walt’s original family-friendly core value. Nothing underscores that reality better than Disney’s 1993 purchase of Miramax Films.

The brainchild of brothers Harvey and Bob Weinstein, Miramax was well known in the movie industry for buying independent films cheap and distributing them for a tidy profit. Many of those films were controversial not only in their graphic violence and sexuality, but in the exploitative manner in which the Weinsteins marketed them.

Miramax marketing official Mark Gill admitted as much when he said, “We spend a lot of time making movies look more provocative than they really are. Our cheap cliche´ is: ‘Sex, betrayal, murder.’ People want to see things that are provocative. You’ll see a lot of women with no clothes on their backs in our ads. We’ll put a gun in the ad if we can. It works.”

After Disney purchased Miramax, Eisner called it “the smartest move we made in the movie business.” And the Disney CEO made it clear that he was not taken by surprise by the nature of Miramax or its product, which even he admits were “often controversial films aimed mostly at a sophisticated adult audience.”

Nevertheless, the seeming contradiction between Disney’s family-friendly past and the aggressive edginess of Miramax raised eyebrows in the industry after the purchase. But that didn’t matter to Disney. When Jeffrey Katzenberg, then head of Disney’s film division, was asked if he thought Walt Disney might not be spinning in his grave over the deal, he said, “I don’t know. I haven’t been over to the grave lately.”

Disney executive Joe Roth admits that Disney and Miramax are “odd bedfellows from a content standpoint, but from a business standpoint, we’re terrific partners.”

Marketing Miramax is apparently so important to Eisner that Disney recently opposed a congressional measure that would protect children from online pornography. The Child On-Line Protection Act (COLPA) was intended to require all Internet web sites to verify an adult’s age before allowing him to view pornography or other material deemed “harmful to minors.”

But Disney and others, including the Motion Picture Association of America, resisted COLPA. Lobbyists for Disney said the company was worried that some of its films, especially those produced by subsidiaries Miramax and Touchstone, could not be marketed online if the measure passed.

Disney sells porn
With the Mouse firmly entrenched in its new money-making mindset, it was no surprise that Disney would throw off all moral restraints in its quest for profits. The Schweizers write that in 1989 Disney became a full partner in a pay-per-view company called Viewer’s Choice, which in the 1990s has become a leader in providing “soft-core” pornography to its customers.

While Viewer’s Choice initially ran mainstream Hollywood films, in 1993 the pay-per-view company added “Hot Choice,” which airs “adult” movies. The channel offers such fare as The New Video Vixens; Erotic Heat; American Stripper on Tour; Erotic Confessions; and Beautiful Kinky Nudes.

No other company owns a larger stake in Viewer’s Choice than Eisner’s Mouse House, but the Schweizers said Disney “won’t talk about its role as a partner in [Viewer’s Choice] or the size of its profits.”

Yet profits are undoubtedly impressive. Viewer’s Choice serves more than 1,000 cable systems, with more than 59 million pay-per-view channel subscribers. The Schweizers said, “Every time someone watches these programs, each partner in the company gets a cut, including the new Disney.”

Protecting the Mouse at all costs
As a self-defined “fierce protector of [Disney’s] brand,” Eisner apparently puts the name of Disney above all other considerations. In this regard, some of the charges made by the Schweizers are chilling.

To avoid bad publicity, for example, the Schweizers write that officials at Disney World have stifled on-site homicide investigations, not reported sex crimes and refused to fire Disney employees that were caught peeping on guests in changing rooms.

More disturbing, the Schweizers say, “The same company that continuously peddles its ‘child friendly’ image won’t cooperate with police efforts to deal with the very real pedophile problem at Disney World.”

In fact, when informed about Disney, The Mouse Betrayed, ABC News prepared a 20/20 segment about it. The news show had an exclusive contract with the Schweizers, promising that though Disney owned ABC, that fact would not affect the story.

But ABC News cancelled the story, saying only that it “did not work.” A source at ABC told Conservative News Service that jobs may be lost because of the segment.

The network has also denied that Disney had anything to do with the decision. But Peter Schweizer said, “If this were a story about any other company in America, would there be this problem?”

In reality, there is no other company in this country like Disney. It has an unparalled heritage and commands a unique loyalty in the hearts and minds of Americans. But as Eisner said, even this prestige can be “undermined cumulatively over time, the product of a thousand small gestures.”

Ironically, Eisner’s autobiography opens with a quote from Maxwell Anderson, who says “inherited morals dissipate as rapidly as inherited wealth." The irony is that Disney may lose both.