In December of 1966 Walt Disney died.
Just a month before he had been diagnosed with lung cancer caused by decades of heavy smoking.
The rapid decline between his diagnosis and his subsequent death left much of the world stunned.
This wasn’t a slow gradual battle with cancer.
Neither Walt Disney Productions nor the public had time to cope with the idea of a future without Walt.
One week he was around, and the next week he wasn’t.
It was an abrupt and startling change that left a looming question: What would become
of Walt Disney Productions?
After all, Walt was not some paper pushing executive.
As head of the company, he was always involved in the creative direction that it would take,
and it was an involvement that led Disney down so many unique and new paths.
Cartoon shorts with sound, then with color.
Feature length animated films.
A theme park.
Animatronics.
Even a proposed city of the future.
Walt was never one to rest on his laurels and it was hard to imagine what he was dreaming
up next.
While the world mourned the loss of Walt, the company was forced to move forward without him.
His older brother Roy, who had spent his career managing the business side of Walt Disney
Productions, postponed his retirement to take over the company and finish the first phase
of Walt’s final project: Disney World.
Walt Disney: Everything in this room may change time and time again as we move ahead, but
the basic philosophy of what we’re planning for Disney World is going to remain, very
much, as it is right now.
It was planned to ultimately feature a living breathing city of the future called EPCOT,
but phase one was all about an east coast version of Disneyland and a number of hotels.
Roy stuck to his word, and in October of 1971 Walt Disney World was opened to the public.
The larger question of how Walt Disney Productions would continue on without Walt still lingered,
but at the very least his last dream was off to a start.
Just two months later Roy, at age 78, died from a brain hemorrhage.
That year would mark the last time that Walt Disney Productions was run by a Disney.
Regardless of how prepared they were, it was time to answer the question of how to move
on without Walt.
The answer, as it turned out, would be provided by these three men: Donn Tatum, Card Walker,
and Ron Miller.
With the death of Roy, Donn Tatum was given the role of CEO.
He had been with the company for 25 years at that point and played a pretty crucial
role in helping Roy build Disney World.
Card Walker had served as COO of the company while Roy was making Disney World a reality,
and became president of the company when Tatum became CEO.
He was a real life version of the American Dream concept.
He started with the company by working in the mail room over 30 years earlier and climbed
the company ranks.
Ron Miller was a film producer at Walt Disney Productions who also happened to be the husband
of Diane Disney, Walt’s daughter.
These three, in a sense, were the keepers of Walt’s legacy at the company.
Tatum and Walker, especially, had decided that the best way to take Walt Disney Productions
into the 1970’s was by running every decision past the question of “What would Walt do?”
It was a filter that aimed to hold onto the spirit and atmosphere of Walt’s era.
Films produced in those years after his passing carried the same tone as they did in the 1960’s.
Resort prices rose as the parks grew, but only as much as they needed to.
Disney would never really capitalized on the resort’s popularity.
It seemed that the answer to “What would Walt do?” was that he would keep doing the
same exact thing he had been doing for the last ten years.
The problem was that such an approach wasn’t Walt’s style, poetically making the asking
of that question one of the last things he would actually do.
Perhaps, on its own, that wouldn’t be a big issue.
Sure, the company would stop evolving and growing, but as long as the movie-going public
and theme park guests still enjoyed it all, they’d remain in business.
However, times were changing.
The 1970’s saw an evolution in cinema.
With the rise of auteur filmmakers like Stanley Kubrick, Martin Scorsese, Francis Ford Coppola,
and Stephen Speilberg, audiences grew less interested in the studio-style films of the
past, which is exactly what Disney specialized in.
Beyond that, the industry was changing.
The birth of summer blockbusters with films like Jaws and Star Wars brought upon a new
era of increasingly expensive films and film marketing.
Most studios at the time realized that Hollywood was changing and changed along with it.
Audiences wanted grittier and raunchier movies and they wanted films directed by artists.
Disney, holding true to the Walt era, refused to dabble in R-rated films, ignored new radical
story ideas for the safer concepts of the past, and kept advertising budgets low, hoping
that word of mouth would be enough to bring in audiences.
It wasn’t.
They still held down a corner of the market for children’s films, but general audiences
were growing less and less interested in the safe Disney style.
What started as a minor case of arrested development grew more extreme with each passing year.
Meanwhile, their theme parks were growing while their prices weren’t.
This was great for guests, because let’s be honest, who wants to pay more to go on vacation?
But the result was a division of the company that wasn’t bringing in the type of revenue
that it potentially could.
It also wasn’t helped by the two hits that tourism took in the 1970’s due to oil issues
overseas, and the rapidly bloating budget of Walt Disney World’s second theme park,
EPCOT Center, which would be the project born out of Walt’s futuristic city concept.
It was nice that Tatum and Walker were trying to stick to the ideas of Walt's era, but it was turning out
to be bad for business.
In 1977 Walt’s nephew, Roy E Disney, left the company.
He had written a letter justifying the decision, in which he claimed that “The creative atmosphere
for which the Company has so long been famous and on which it prides itself has, in my opinion,
become stagnant.”
While Roy’s contributions to the company weren’t massive, it was seen as a blow to
have the last remaining Disney working at the company leave.
As Disney moved into the 1980’s, things didn’t improve.
Leadership had passed on from Donn Tatum to Card Walker, but that mentality of making
decisions based on what they thought Walt would have wanted stuck around.
Even when they did try something new, the risks taken were minor.
The 1979 film, “The Black Hole”, was a clear attempt at trying to put a Disney twist
on 1977’s Star Wars.
Now-
Gravity is at maximum Dan!
My god I think it’s got us!
-man is about to enter-
We’ve got a break here too!
-the black hole.
A journey that begins where everything ends.
They finally pushed their limits and stepped outside of their Walt-era comfort zone by
using the words ‘damn’ and ‘hell’, bumping the film from a G rating to a PG rating.
With a move so bold and daring, surely Disney would finally pull out of it’s malaise.
They were not.
The Black Hole didn’t bomb completely, but considering it was one of their higher priced
films of the era, it definitely didn’t pay off for them, grossing only around $10 million
more than they spent on it.
In 1981 NBC cancelled “Walt Disney’s Wonderful World of Color”, a series that existed in
one form or another since the 1950’s, due to low ratings, which forced it to move over
to CBS.
More experimental films like TRON were misses for the studio, while their safer pictures
such as the fourth Herbie the Love Bug film were offering diminishing returns.
What’s playing?
Uh “Night of the Surfer“
What was that we saw tonight?
“Surfer Beach Party”
And the night before last?
Well that was “Rick: Son of Surf” and “Sinbad the Surfer”.
Double feature!
Canoe, do you ever get a spooky feeling that we keep seeing the same movie over and over,
and all they do is change the titles a little bit?
Yeah, it’s terrific stuff, isn’t it?
The studio had not only stopped innovating, as Roy claimed, but their general output had
also slowed to a crawl.
By 1982 and ‘83, Walt Disney Productions was releasing just three films a year.
By comparison, the other major studios were releasing upwards of ten films per year at
the same time.
Disney was taking fewer chances with fewer films among more competition, so it wasn’t
so surprising that they were seeing fewer payoffs.
In 1983 Walker stepped down as CEO and passed the torch to Ron Miller, who had been a producer
for many of the films of the 1970’s.
It was a move that actually looked like it might bring about some change.
Miller formed a new studio under the name Touchstone Pictures, which would allow Disney
to produce raunchier content that they wouldn’t dare put under the Disney name.
Tom Hanks, National Treasure: I’m looking for a girl Timmy!
Timmy: 200 bucks.
Tom Hanks, America’s Dad: No no no!
The one I came in with this afternoon. The blonde.
Timmy: Oh. She left!
The 1984 film, Splash, starring Daryl Hannah and Tom Hanks grossed $69 million against
an $8 million budget, making Touchstone’s first film a big hit.
He also created The Disney Channel, a premium pay channel that would broaden the companies
reach to the rapidly growing world of cable television.
Unfortunately for Miller, it seemed to be too little, too late.
Disney’s approach to facing the future without Walt resulted in their revenues and stock
prices stagnating while their cultural capital held strong.
Disney was, after all, still an American classic, and characters like Mickey and Minnie were
still beloved.
They were just under the umbrella of a company that wasn’t taking full advantage of how
much they were valued.
That low stock price along with the perceived high value of everything they owned made them
the perfect targets of a hostile takeover.
and that is when the infamous corporate raider, Saul Steinberg, took aim at Disney.