Disney CEO Says Consumers Prefer Computer to TV for Entertainment

March 19, 2009

Walt Disney CEO Robert Iger spoke today at Harvard Business School on Disney’s performance, its future outlook, and how it is navigating the changing media environment.

Iger highlighted the role unique content plays in value creation for Disney, summarizing the Disney model as monetizing content across multiple businesses, platforms, and geographies. “Distribution is becoming a commodity,” he says. He said that Disney looks at new media consumption broadly, as a means of distribution and a catalyst to create content tailored to that channel.

Disney research indicates that 80% of Millenials consider the computer their preferred entertainment device. Gen Xers hold similar beliefs, and 69% of online Baby Boomers prefer their computers. The ability to monetize new media is not as obvious as traditional platforms, he said, which presents challenges to Disney's core businesses (such as ESPN and ABC). Still, he sees tremendous promise in the affinity that Disney can create with its online customers. “After a customer watches a movie in a theater, I can’t reach them… but I can sell to an online consumer, I can ask for their feedback.”

Given the recent performance of broadcast companies (e-Marketer predicts a 19% revenue decline in 2009), Iger’s enthusiastic adoption of these new technologies may be his only option. “Technology enables new brands to enter the marketplace and it changes consumer behavior,” he said. Brand managers don’t like it. But, he acknowledged, you cannot stand in front of it. You can’t even really slow it down.

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