Pixar, Disney, and Apple, Oh, My!

And just when you thought it was safe to watch Mickey Mouse, Disney buys Pixar and Steve Jobs joins the Disney board. While the result will probably land someplace in the middle, I?d like to explore the extremes of this move, and to forestall the typical Apple-fanboy-take-everything-out-of-context-response, I?ll point out that I actually think this will end up more on the positive side than the negative side of these scenarios.

Apple Takes over the Digital Home Scenario

Let?s be clear:  The fight for the digital home has a heckuva lot more to do with content than with any technology. While the iPod is a fabulous design, it wouldn?t have sold well at all if it wasn?t for iTunes and the ability to put content on it. The next generation of devices requires good video content and getting that, legally, has been a nightmare for everyone, including Apple.

Of all the studios, Disney is the only one people actually ask for by name. While this usually applies to media they are buying for their children, it is a unique and powerful asset. Disney is also seen as a market leader; the other studios still watch what Disney does closely and are very likely to follow Disney?s lead. In short, were I to pick one studio to first partner with, Disney would be on my own short list. And Jobs went vastly farther than just a partnership here.

While some may question Jobs?s motives, his focus on the consumer?s right to consume content, be it music or videos, has never wavered. Personally, as long as someone is on the same side I am, I?m not particularly concerned if they are only doing it for the money. And in this fight, having someone as articulate, manipulative, and charismatic on the Disney Board on my side has got to result in some powerful and popular changes to the brain-dead DRM behavior we so far have been getting out of all of the studios, including Disney.

Pixar, which I admit has produced some of the most entertaining and creative movies I?ve seen over the last several years, is a godsend to Disney, which clearly has lost its creative edge. As an ex-Disney employee myself, I still have a little pixy dust in my vanes and long for the day when Disney resurges and takes back the market it created. Pixar, like no other resource, could help them do that.

We already know that Apple can build a compelling hardware design and user interface. If they can get access to Disney content, and this becomes a trend resulting in broad content access, they can be a credible competitor to Cisco who, along with the cable industry, is on the fast track to owning the digital home space right now.

Disney does some interesting design work as well, which could result in some Apple/Disney co-branded products for kids, like Apple once had.

This, however, all assumes Steve Jobs plays to his own strengths and stays focused on Apple while heavily influencing Disney. But what if he plays to his weaknesses and tries to take over Disney directly?

The Crash and Burn Scenario

If you?ve read the latest Steve Jobs unauthorized biography Icon, you?ll see that Pixar is largely successful because Jobs takes a hands-off approach to that company, and the Pixar executives have kept Jobs away from the Pixar employees. Jobs originally wanted to turn Pixar into a hardware company, which would have had the same result he enjoyed with Next; had he stayed on that path, Pixar would probably no longer be around today.

Jobs is not good with employees in general, and creative types are one of the most difficult to manage. In entertainment, the best often need special handling because they trend towards the temperamental (I think some folks that know this industry will point out my gross understatement here). Remember, Jobs is a guy who sends his food back in restaurants for no good reason, yet hasn?t figured out why he probably shouldn?t be eating what comes back out. (If you?ve ever worked in hospitality, you know what I?m talking about.) His strength, strangely enough, really isn?t understanding people; this would be a huge problem if he tried to manage Disney directly.

If Jobs entered Disney with a heavy hand, you could likely measure his progress through the company by the number of key resignations that would result. Jobs particularly doesn?t like to admit his own ignorance, and Disney is a very complex company with diverse products that span from children?s toys to theme parks, hotels, cruise ships, theatre, movies, and TV.

There is increasing speculation that Jobs will ?Amelio? Disney?s current CEO; if you were to ask several previous CEOs (including John Scully) whom he worked under, you would find a lot of support for that argument. Jobs doesn?t like being in a subordinate role; once he determines that the CEO he is working with isn?t as smart as he is (and I doubt there are few people in the world he considers as smart as he is), he is likely to move aggressively against them and attempt a coup.

The result, if successful, would shift his focus away from Apple (where he remains desperately needed) and put it on Disney (where he probably isn?t even particularly wanted). If the coup succeeded, we would likely see the typical result, an unqualified CEO running a large company with an iron hand. The phrase ?train wreck? comes to mind, and this wreck would include all of the properties. If the coup failed (as did his first one at Apple, and you have to believe that Robert Iger sees this coming), Jobs would be fired from the Disney Board and Apple would drop to the last (as in cold day in hell) position in the content access list for Disney?and Disney?s lead here would probably be followed by others.

However, on the positive side, Cisco and Microsoft would be much happier if this came to pass. I put the odds of this happening at 30%:  Possible, but unlikely.

Final Thoughts

This deal has all of the earmarks of brilliance. Disney gets what it needs to recover, Apple potentially gets access to the most powerful studio in the industry, and Pixar gets the resources to do more amazing things. But brilliance has as much to do with execution as it does with concept.

The Lisa, the Newton, and Microsoft Bob all started out as brilliant ideas, the execution turned them into dismal failures. I believe that Jobs knows and will follow the right path; however, I also know that Jobs can be his own worst enemy at times. I hope that won?t be the case here, as I would really rather the cable industry not own my future digital home.

The views expressed here are solely those of the author and do not reflect the beliefs of Digital Trends.

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