ESPN’s Direct-to-Consumer Transition Is ‘First Priority’ for Bob Iger, Kevin Mayer Says

The Candle Media co-CEO, who returned to Disney in a strategic advisor capacity, said the studio chief "needed some part of his team back" after the company "vastly changed"

The post ESPN’s Direct-to-Consumer Transition Is ‘First Priority’ for Bob Iger, Kevin Mayer Says appeared first on TheWrap.

Former Disney executive and Candle Media co-CEO Kevin Mayer says ensuring that ESPN is well positioned for the future is Bob Iger’s “first priority.”

“He has ideas to fix it and to strengthen it and to change its business model over time,” Mayer said during Yahoo Finance’s Invest conference on Tuesday. 

In July, Iger told CNBC that he was searching for strategic partners who could help with content or distribution for an eventual launch of a fully direct-to-consumer version of the network. Potential partners that have reportedly been floated include tech and telecommunications giants like Amazon, Apple or Verizon as well as sports leagues themselves such as the NFL, NBA or MLB.

“We want to have content partners who can really strengthen our hand and allow us to create multiple tiers of offerings,” Mayer said. “And we want to have distribution partners, so you think digital, you think telcos, those types of players.”

Analysts have predicted that an ESPN OTT offering could potentially cost around $30 per month, with launch expected as early as 2025. Though Mayer declined to disclose details about the offering or the search for strategic partners, he acknowledged that a $30 price point would be “entirely reasonable” to get ESPN’s full suite of sports, noting that consumers have historically always paid a lot.

Iger has tapped Mayer and his Candle Media co-CEO Tom Staggs as strategic advisors to help consult on Disney’s linear and streaming business.

“He needed some part of his team back. He came back to a company that had vastly changed,” Mayer explained. “When you come back into a situation that’s vastly changed since you left and a lot of the team team that you had before and relied on before her gone, I left him in a position where he really wanted to have some people that he trusted tell them what they thought, and that’s what I’m doing. I’m not spending an enormous amount of time but I was at the company for a long time. I’ve seen a lot of the dynamics that are happening out there in the world, and he trusts my judgment on some things. So I just talk to him from time to time.”

In addition to ESPN, Mayer was asked about another priority for Disney – succession planning. Iger, who returned to the company in November 2022 following the ouster of his successor-turned-predecessor Bob Chapek, has agreed to extend his contract through 2026. Mayer expressed confidence that Iger and Disney’s board would be able to pick a “great” successor.

“They have several of them in the company and the people outside the company that they can go to,” he said. 

Whomever takes over the company will depend a lot on how Bob Iger ends up reconfiguring the company, Mayer said. Iger has previously stated that Disney’s linear assets “may not be core” to the company, suggesting he would be willing to potentially offload ABC, FX and National Geographic to the right buyer. The company is also exploring strategic options of its Star India business, including a possible joint venture or sale. 

Regardless of what happens to Disney’s linear networks, Mayer is hopeful that the company will have a bright future, touting its core brands like Marvel, Star Wars and Pixar as growth opportunities for its streaming and theme parks businesses. He added that gaming could be another potential growth opportunity where Disney has not yet made a substantial investment. While shares of Disney have fallen 16.2% in the past year, he believes the stock will bounce back as Iger continues to lay out the company’s strategic vision. 

When asked directly if he would be interested in the Disney CEO job, Mayer said that he’s currently busy running Candle Media, which is “on a scale right now to be a public company.” While suggesting the Blackstone-backed studio could potentially go public, he also teased that a strategic acquisition of the company from a larger media player like Disney or Warner Bros. Discovery or a sale to a private equity firm like KKR isn’t out of the question. 

“We’re going provide value to shareholders, whatever that path is,” he added. 

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