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The Loneliest Man in the Kingdom : Forget Walt. Michael Eisner, Disney's Hands-On Chairman, Is Shaping the Company in His Own Image, Signing Off on Everything From Scripts to Carpet Patterns. But in Today's World of Corporate Mergers and Alliances, Can Mickey's Competitive, Go-It-Alone Boss Keep Winning?

March 26, 1995|KATHRYN HARRIS | Kathryn Harris, a staff writer for The Times, covers Hollywood for the business section

On an afternoon in January, Walt Disney Chairman Michael D. Eisner sat midway down the aisle in a darkened theater on the Burbank studio lot, watching a five-hour spectacle unfold. This was no "Pocahontas" screening, although the animated feature is being readied for summer. Nor was Eisner previewing the live-action thriller "Crimson Tide," due from the Don Simpson-Jerry Bruckheimer team that delivered the bulk of Paramount Pictures' blockbusters in the 1980s.

Instead, a live performance was under way, with top Disney executives addressing 130 analysts who had traveled from brokerage firms and banks to gauge the strength of Disney management after a disaster-filled year. Disney's respected president, Frank Wells, had been killed in an April helicopter crash, and the studio's hardworking chief, Jeffrey Katzenberg, had departed in September after lobbying unsuccessfully to be named Wells' successor. It had been an ugly, public spat. Then, in July, the 52-year-old Eisner had undergone emergency heart bypass surgery.

For many analysts, the meeting provided their first opportunity since Eisner's hospitalization and Katzenberg's exit to see the Disney chairman in person. Indeed, analysts had not been invited en masse to the Disney studio in a quarter of a century, and four years had passed since Disney hosted a large meeting of any kind for the investment community. But Disney's stock price had slipped from a February high of $48 to an October low of $37.875, reflecting Wall Street's uncertainties. With this meeting, Eisner hoped to quell any doubts about his health or that of the company.

He sat quietly as top managers delivered glowing reports about Disney's vast operations, ranging from theme parks to stores, movies and videos, publishing and television. In the dark, the visitors struggled to take notes as nuggets of financial information were parceled out by the speakers or flashed on the theater's 35-millimeter screen. A guard stood watchfully in theaisle near the Disney chairman. Eisner saved his remarks for last, keeping questions to a minimum. Deftly, he fielded queries about re-engineering the thrill quotient of the "Tower of Terror" and "Alien Encounter" attractions at Walt Disney World. He answered the knottier question of what he could have done differently at the money-losing theme park in France ("In hindsight, we would have spent a little less and priced it a little lower.") Only once did he falter, when analyst Lee Isgur of Jefferies & Co. asked: "Looking out over the next decade, what is the company going to look like?" "I don't know," Eisner answered, in an admission unthinkable for a chief executive like the late Steven J. Ross, who, as Time Warner chairman, spun visions of global alliances and a high-tech future. Instead, Eisner spoke of the potential of the recorded music business, which Disney has been trying to crack for almost six years. "It's just a matter of finding the groups," Eisner said. Mindful of rival studios that have big music divisions, he added pugnaciously: "They're coming after us in animation? We're going to go after them in music."

As evening fell, most analysts concluded that at least for now, Disney's prospects are still rosy. The next day, Disney's stock jumped 6%, and Eisner telephoned a reporter, elated. If all meetings were so successful, he joked, he would host one a week. Then, with the kind of jab that he finds irresistible, the Disney chairman noted that Time Warner's stock fell after its analyst meeting last fall.

It was quintessential Eisner: competitive to the core. Winning is everything, and he barely masks his glee when rivals stumble. His compulsive need to belittle rivals would be more off-putting if he were not endowed with impeccable manners, still-boyish charm and self-deprecating wit. Though friends say they enjoy his quick and unpredictable mind, which makes him a good companion at dinner or the hockey rink, he is relentless and, therefore, a compelling boss and devilish foe.

Those traits have served him well for the past decade. Disney profits have increased eleven-fold, and on the New York Stock Exchange, Disney's total market value now exceeds $27 billion--up from $1.8 billion in 1984. An operations man at heart, Eisner is at his best in meetings with the creative teams clustered throughout the Disney empire, where he functions as Disney's ultimate arbiter of taste. It is Eisner who has personally recruited world-famous architects for Disney buildings; in recent months, he has selected the carpet for new hotels and passed judgment on new Epcot television commercials. No detail is too small to escape his attention, and in this way, he weaves his own enthusiasms through the fabric of the company.

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