How Disney Stumbled

A
few years ago, I was talking to the host of a popular Disney-theme-park podcast when the conversation invariably led to where it always does between two Disney adults: Why do we love Disney so much, when everything it does seems tailor-made to piss us off? 

This was in 2022, in the midst of a particularly brutal public-relations war sparked by the so-called Don’t Say Gay bill, Florida Gov. Ron DeSantis’ legislation prohibiting public schools from including materials about LGBTQ+ identities in their curricula. Many Disney employees were outraged by the bill, and because the company’s largest theme park is based in the state, there was massive internal pressure on then-CEO Bob Chapek to speak out against it. But Chapek did the opposite, explaining in a memo that publicly decrying Don’t Say Gay would “do very little to change outcomes or minds” and would only serve to “further divide and inflame.”

Eventually, following days of bad press, Chapek issued a memo apologizing for not publicly opposing the bill. But the damage had already been done: Both progressives and conservatives were outraged, and the bad press eventually led to his ouster a few months later. According to reporting from The New York Times, Chapek would later tell people that he felt unfairly targeted, since his handling of the bill (or more accurately, its lack thereof) had been supported by the board as he went.  

Disney’s approach struck many, including myself, as the apogee of corporate bungling. It felt like the company was sending a clear message that although it would be happy to accept money from members of the LGBTQ+ community, that wasn’t tantamount to acknowledging its right to exist. And as a queer Disney fan myself, that message didn’t sit well with me. So I asked this podcast host: How did he square his own principles with loving Disney? Did he feel bad about it? He didn’t have to think twice about his answer.

“Not really,” he said. “They keep putting out stuff I like. Yes, it’s a big, soulless corporation. And, yes, I still love it. Because they make things that move me.”

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At the time, I thought this was kind of bullshit. There are a lot of brands that make things that move people. I, for one, am moved by fried-chicken sandwiches and carbonated water and $10 canvas sneakers. Yet I avoid buying Chick-fil-A or a SodaStream or Shein clothes, because there are aspects of their business practices that do not move me, that I, in fact, find repugnant. And while it may be momentarily satisfying to write a scathing Twitter thread calling out colonialist violence or evangelical Christian homophobia, voting with my wallet is by far my most effective form of protest. So why not do that, even if it means I can’t stream The Simpsons on Disney+, or purchase the new Pizza Planet-truck-inspired popcorn bucket? Is that really such a difficult tradeoff in order to affect some concrete, if marginal, change in the world?

As it turns out, for me at least, the answer is yes. Because a few weeks — not even a few months — after the Don’t Say Gay debacle, I booked a trip to Disney World. I’ve gone on at least two more since then; in fact, I just came back from another one two weeks ago. I haven’t stopped buying my kids Disney-branded clothes and toys. I haven’t even canceled Disney+. The simple explanation for why I do this is because I am a hypocrite who is devoid of integrity. But I fear the actual explanation is far more complicated. 

I am one of a cadre of people who self-identify as Disney adults. While it would be easy to define this group as “adult Disney fans,” it’s a little bit like saying Beauty and the Beast is a movie about a hot girl who reads a lot and then develops Stockholm syndrome; it’s technically true, but it also kind of misses the point. Unlike Swifties or Trekkies or Philadelphia sports fans, Disney adults can’t really be defined by one or more demographic traits; you can’t say they skew white and female or middle-aged and nerdy or inebriated and prone to battery-throwing, because they are any and all of the above. They are united by only one factor: an unflagging belief that everything Disney puts out, from its streaming shows to its theme-park attractions to its cruises to its animated films, is superior to that of its competitors, in that it is infused with a specific ethos that can only be summarized as “Disney magic.” 

Disney magic is a term that’s even more difficult to define than Disney adult. On a customer-service level, it refers to the small touches that make a park guest’s stay more memorable: a free dessert here, an extra 30 seconds interacting with Chip and Dale there. It’s the type of attention to detail that is supposed to make you forget you’re spending thousands of dollars on a vacation, because Disney is not supposed to feel like a vacation at all. It’s supposed to feel like an enhanced version of reality, where the people are nicer, the streets are cleaner, and the food tastes (marginally) better. 

But there’s another aspect of Disney “magic” that’s more ineffable. It’s the way a full-grown adult man kind of has to catch his breath when he sees an actor playing Cinderella in full regalia. It’s the distinctly floral chlorine scent that wafts from the waters of Pirates of the Caribbean (so beloved that there are candles sold on Etsy inspired by the odor), or the way you automatically hear a clip-clop of hooves when “76 Trombones” pipes through the sound system of Main Street USA. It’s a feeling that marketing experts would likely chalk up to decades upon decades of a multinational conglomerate building brand allegiance across generations, but that a less cynical person would attribute to the apotheosis of the ideology popularized by Walt Disney himself, the idea that Disney will exist “as long as there is imagination left in the world.” Disney magic can be best summarized as a testament to the boundless human capacity for imagining, whether that applies to a child gazing up at Sleeping Beauty’s castle or an executive trying to figure out how to maximize quarterly Frozen-merch earnings. 

As a kid, I went to the Disney parks with my family probably every other year, because they were the one place where our conversations didn’t end in shouting and tears. I used to spend hours writing in my journal about vacations we took months ago, documenting every little detail like where we went to eat or about other families we’d met at the hotel. I would read and reread these entries, because they served as a reminder for me that there was a place where I could be happier than I was at home or at school, where all the kids thought I was a snaggle-toothed weirdo who read the dictionary for fun. (They were right, but that’s not germane.) So for me, Disney magic was the ability to envision a world where people were nicer than we were to one another, or than my family was to ourselves.

Disney is, of course, not just its parks: It is an entire brand universe, comprising consumer products, publishing, media networks (ESPN, ABC, FX), studios (Pixar, LucasFilm, Marvel, 20th Century Studios), and international operations. It has such a stranglehold on the culture at large that according to one survey, Mickey Mouse has a higher level of name recognition than Santa Claus. Entire generations have grown up on a steady diet of Disney-owned properties, a list that has only expanded since the acquisitions of Marvel, LucasFilm, Pixar, and 20th Century Fox over the past two decades. One could theoretically spend an entire human life cycle exclusively consuming Disney products, from being swaddled in a Mickey-branded Huggies diaper to exchanging wedding vows in front of Sleeping Beauty Castle. And while there’s no such thing as a Disney-branded birth or funeral, I would bet my 401(k) that the idea has been floated in boardrooms. 

For the past few years, however, there has been a distinct sense that Disney has been slipping in its ability to consistently provide consumers its trademark magic. Though 2023, the company’s centennial, was projected to be a banner year, its last animated feature, Wish, was a box-office flop, as was Pixar’s Elemental; its Marvel entries, The Marvels and Ant-Man and the Wasp: Quantumania, fared little better. In May 2024, CEO Bob Iger revealed at an investor conference that Disney+, the company’s streaming service that launched in 2019, was operating at a $4 billion loss, largely due to what he deemed an emphasis on “volume and not quality,” according to The Hollywood Reporter. Even the parks division, typically the most profitable of Disney’s verticals, is flailing, with operating profit declining three percent last quarter due to what CFO Hugh F. Johnston referred to as “moderation of consumer demand.” Share prices have plummeted. 

Over the past few months, I have spoken to various figures within Disney’s extensive orbit. Depending on who you speak to, the loss of Disney magic can be attributed to a wide range of factors: Many point to Bob Chapek, the parks head turned CEO who, by the end of his brief tenure, was so widely reviled that he was literally booed off the stage at the D23 fan expo. According to a September New York Times investigation, Chapek had essentially been pushed out by his predecessor Iger, who served as CEO for 16 years before retiring in 2021. A beloved figure within the company for years, Iger had become frustrated with Chapek’s poor management of Disney creatives, according to the Times piece, orchestrating his ouster even after he had personally hand-picked him as his successor.

Others pointed to various external factors, such as the devastating impact of the Covid-19 pandemic, which led to the parks being temporarily shuttered, tens of thousands of employees being laid off, and a $4.7 billion loss in the third quarter of 2020. The economic instability brought about by the pandemic “was bad for every company, but especially Disney, because they count so much on the parks” for revenue, says Scott Gustin, a reporter who covers theme parks. “And I don’t think things have been steady [at the company] since.” 

Overall, however, there is a distinct sense among almost everyone I spoke with that over the course of the past few decades, via a series of decisions motivated by an amalgam of greed and complacency, Disney is in serious danger of losing its position as a cultural juggernaut. “Disney’s never hidden the fact they’re all about your money,” one former midlevel corporate employee told me. “But they’ve also provided high-value entertainment, high-value experiences. Now, I would say the company has pivoted to nickel-and-diming. And they are not providing high-quality entertainment and experiences in the same way.” (Disney did not respond to requests for interview or comment.)

These conversations painted a portrait of a corporation on autopilot and operating under the assumption that it is simply too big to fail. These sources contend that while this may have been true for Disney at one point, the company has squandered enough goodwill among its consumers that it no longer is. “There is a sense that if the company is not careful and they don’t adjust their course, that there is a point where people won’t see them as the leader anymore,” says one former employee. They also were reflective of a company that is dismissive toward, if not outright contemptuous of, its most loyal fans. According to two former corporate employees, the company eschews hiring what one referred to as “superfans,” viewing a love for the brand as “a huge turnoff.” “To me, it feels counterintuitive, because I feel like you’d want to hire the people who know the brand best, so they can protect it,” the person said. “Some of your biggest advocates are going to be these people.” 

Fans of the parks in particular have expressed mounting frustration with rising ticket prices, the elimination of various amenities, and the perceived decrease in quality of the overall experience. 

Many of the sources I spoke to for this piece told me that in recent years, staffing had been an issue at the parks, leading to attractions being shut down, and overwhelmed employees providing poor customer service. Some issued complaints directly to the company, only for such feedback to fall on deaf ears. “They tolerate fans,” the former corporate employee told me. “They take their money. But I feel like the fans and the bloggers and the influencers kind of annoy them, too. From my perspective, they don’t market toward the people who are their biggest moneymakers.” 

In true Disney-adult form, many sources I spoke with skewed toward personifying these failures, viewing them as reflective not of a multibillion-dollar corporation subject to shifting markets and trends, but of an individual whose actions cause personal disappointment. One source I spoke with likened the company to a toxic ex-boyfriend who you always come back to against your better judgment; another person, to a high school mean girl. Now, they say, the brand is facing the consequences. “People are revolting against Disney,” one former executive said. “They are sick of the bully in the room.” 

TO BE FAIR, DISNEY HAS BEEN in similarly dire straits before. In the early 1980s, the company had lost its primacy in the film and animation markets, churning out forgettable features like The Fox and the Hound and Pete’s Dragon. Between 1982 and 1984, its net income fell by 25 percent, making itself vulnerable to takeover attempts by corporate raiders. With the appointment of Michael Eisner as CEO in 1984, Disney’s fortunes shifted, ushering in the so-called Golden Age of Disney animation with features like The Little Mermaid, Beauty and the Beast, and Aladdin; drastically expanding the parks, including Walt Disney World’s Animal Kingdom and Hollywood Studios and Disneyland Paris; and acquiring ABC in 1995, including ESPN. Eisner also introduced the particularly brilliant marketing strategy of capitalizing on its existing intellectual property (IP) by selling limited-edition VHS tapes of classic Disney films, releasing them only for short periods of time. This strategy allowed millions of Gen X-ers and millennials to inject the iconography of Disneyana — the princesses, the castles, the songs, and, of course, the non-fucking mice — directly into their veins. 

In 2005, after a series of high-profile box-office flops and public feuds with former Disney animation exec Jeffrey Katzenberg, the board pressured Eisner to step down as CEO, leading him to hand the reins to then-President Bob Iger. As he documents in his book, The Ride of a Lifetime, Iger had inherited a company that was flailing as it had in 1984: The post-9/11 economic recession had sent Disney’s stock price tumbling, the animation department was adrift, and the advent of internet piracy had taken a bite of the company’s profits. “Almost every traditional media company, while trying to figure out its place in this changing world, was operating out of fear rather than courage,” Iger wrote, “stubbornly trying to build a bulwark to protect old models that couldn’t possibly survive the sea change underway.” 

In short, it was a climate very similar to that of our current media landscape, and Iger was able to clearly visualize a path forward for Disney that did not rely on traditional media frameworks. Foreseeing the impending demise of cable television, he became an early advocate for digital-first mobile-streaming content; he also led the acquisition of Pixar, which was by far outpacing Disney in terms of its creativity and ingenuity, thus successfully reinvigorating the animation team. 

Both of these decisions were widely derided and extremely expensive: “In essence,” Iger wrote of the launch of Disney+, the company’s streaming subscription service, “we were hastening the disruption of our own business, and the short-term losses were going to be significant.” But Iger was keenly aware of the fact that such short-term losses were essential to preserving the integrity of the brand and the quality of the product. “You have to look past whatever the commercial losses are and be guided, again, by the simple rule that there’s nothing more important than the quality and integrity of your people and your product,” he wrote. 

Under Iger’s leadership, Disney became a mega-conglomerate with massive global reach, with the company opening parks in Shanghai and Hong Kong and building its extensive library of IP with the acquisition of Marvel, LucasFilm, and 20th Century Fox. And while this rapid growth has gone a long way in establishing the company’s dominance in the global market, it has also come with accompanying growing pains, particularly following the 20th Century Fox merger in 2019, according to a number of former corporate employees I spoke with. Once a legendary Golden Age film studio that produced such classic films as The Sound of Music, Star Wars, and Titanic, Disney’s acquisition essentially “swallowed up” the company and “spit out what it didn’t want,” according to one source. “That was a very dark point,” says the source. “It was ugly. It was ruthless.” The deal was accompanied by multiple rounds of layoffs, as well as a growing sense of complacency that made many employees’ lives difficult. One former employee sums up the attitude as follows: “You’re so lucky to work here, because you get to work on the best content, the best movies, the best shows in the world. If you are unhappy, we don’t need you.”

To a degree, that attitude has always existed within the Disney brand. Yet those I spoke with said it was more justifiable prior to the merger, as well as the launch of Disney+ in 2019. That year, the company hit a high-water mark both creatively and commercially: Thanks to the release of box-office smashes like Frozen II, Toy Story 4, Avengers Endgame, and Star Wars: The Rise of Skywalker, the company grossed a record $13 billion globally, accounting for nearly 40 percent of the worldwide box office. 

Something shifted, however. Multiple sources tell me that employees felt they were under so much pressure to ramp up output for the platform, and to establish it as a viable competitor to Netflix and Amazon, that it became impossible to keep up.

“There’s a pretty obvious decline in quality starting from 2019,” one former corporate executive tells me. “[2019’s] The Mandalorian is the only thing on Disney+ that was treated with the same care as they had treated [previous releases]. The pressure was just so intense to put out as much content as possible.”

The end result has been a string of anemic superhero franchise entries (The Marvels), overhyped streaming series (the just-canceled The Acolyte), bloated franchise reboots (Indiana Jones and the Dial of Destiny), underperforming live-action remakes (Mulan, Pinocchio), and uninspired animated features, previously the bulwark of the Disney entertainment division (Onward, Strange World, Elemental). Though there have been a few hits over the past few years — 2021’s WandaVision was critically acclaimed, while Disney Animation Studios’ Encanto got a huge boost from its soundtrack going viral on social media — much of its output has been disappointing. And while some of these failures could be explained by the impact of the Covid-19 pandemic, with people failing to return to theaters in pre-2020 numbers, that explanation only goes so far. One source I spoke with speculated that the pandemic only served to highlight how little care Disney was giving to the quality of its entertainment offerings, operating on the assumption that people were bored at home and would watch anything put out under the Disney brand — an assumption that was proven wrong with the failure of what they viewed as subpar films like Soul and Luca. “Covid brought Disney to its knees,” one person told me. “And the problem is, Disney didn’t think it could be brought to its knees. So now it has to reckon with that.” 

On the parks side, previously Disney’s biggest revenue driver, the company has especially struggled. “There’s a lot of discourse around Disney’s rapid growth, and with that a lot of discourse about its perceived greed and the deep decline and quality of their movies and their parks,” says Jenny Nicholson, a YouTuber and former Disney cast member. In the spring of 2024, Nicholson posted a scathing four-hour video essay chronicling the downfall of one of the parks’ most notorious failures, Walt Disney World’s immersive Galactic Starcruiser hotel, which cost thousands of dollars a night and was open for barely 14 months before it shut down. 

Nicholson’s video essay condemning the project as an ill-conceived cash grab amassed more than 10 million views, seemingly due to its ability to tap into the mounting “frustrations” fans have with the parks, she says. These frustrations can be best summarized as the distinct feeling that guests are being cheated. Since the parks temporarily shut down in 2020, the company has slowly eliminated beloved amenities such as early park hours for resort guests, or free transportation from the airport to Disney hotels, or ways for fans to skip lines for free, all while steadily boosting ticket prices. “There seems to be a lot more push toward short-term profits as opposed to the overall longevity and reputation of the company,” says Nicholson. 

As a result of the skyrocketing prices, guests are increasingly shying away from the parks. On an August 2024 earnings call, CFO Hugh Johnston indicated that there had been a three percent decrease, or “a bit of a slowdown,” in operating income at the domestic parks during the third quarter. He added that the company anticipated a similar decline in earnings in future quarters, downplaying it as “a slight moderation in demand.” Such an admission must be particularly galling for the company in light of its arch rival, Universal Studios, building a massive theme park expansion called Epic Universe just a few miles away from Kissimmee, Florida, where Walt Disney World parks and resorts are located. 

One theme park journalist told me that over the past decade, Disney’s Imagineering division — the department focused on creating new theme-park rides and attractions — has focused too much on capitalizing on lucrative IP, such as the Star Wars and Marvel franchises, and less on creativity. “Where [consumers] sit, in 2024, we’re just after who’s innovating and who’s giving us thrills and spending money,” the journalist said. “And that’s Universal by far.”  

Disney’s overreliance on existing IP has been a source of frustration for fans for close to a decade — and if you look at the company’s slate of upcoming releases, it does not seem that they plan to pivot anytime soon. During the August 2024 call, Johnston noted that the downward trends in parks would likely be offset by the entertainment division, including the upcoming releases of highly anticipated films like the CGI-animated Lion King prequel Mufasa, and Moana 2. Citing those two examples is telling: Both are based on existing Disney IP, only emphasizing that the company has become overly reliant on adapting preexisting material, rather than generating new and fresh ideas. “Disney only has a few rabbits in their sleeve when it comes to bringing people to the movies,” one former employee told me. “There’s only so many animated films they can turn [into] live action. There’s only so many rides they can turn into films.” The quality, the former employee said, “is just not there anymore.” 

Ultimately, however, in speaking to various fans and insiders of all stripes, Disney’s decline can be boiled down to one crucial factor: arrogance. Having achieved market primacy for so long, and having garnered such a rabidly devoted and demographically wide-ranging fan base, there is an overwhelming sense that there is nothing Disney can possibly do to lose its hold over the public imagination. To adapt a famous 2016 election-era Trump boast, if Bob Iger stood in the middle of Main Street and shot Goofy in broad daylight, the company would probably lose some fans — but certainly not all. Its guiding ethos appears to be bolstered by the sense that it is simply too big to fail in any meaningful way. But if its recent string of failures are any indication, for one of the few times in the company’s history, it may not be right. 

ONCE, WHEN I WAS IN MY very early twenties, I was on a vacation with my family and we got into a fight. I can’t remember what it was about, but I was distraught enough that I needed to not be with them at the time. So I stalked off into the distance, sniffling and shaking and ignoring my phone calls, in search of  someplace where I had always felt safe. And I ended up on the It’s a Small World ride. 

As my Friendship Boat gently rocked through the water, the intoxicating chlorine fragrance intermingling with that of the microwaved pizza from Pinocchio’s Village Haus next door, and animatronic kiwis and flying fish and can-can girls winking at me from the plasticine shores, it suddenly occurred to me how insane this all was. In a moment of emotional turmoil, I had not retreated into meditation or drugs or alcohol or cognitive behavioral therapy or any of the other tactics at my disposal. Instead, I’d beelined, as if by mammalian instinct, like a dying elephant making its way across the savannah, to a 1965 World’s Fair exhibition sponsored by Pepsi. Why had I done this? What was this going to offer me? How was this going to make me feel better? This wasn’t even an E-ticket attraction. 

There are about a million reasons I can think of to point out why It’s a Small World should not be emotionally effective. It’s long. It’s boring. It is built around a conception of global unity that does not celebrate cultural and political differences but completely eradicates them, as represented in the ride’s final tableau showing all the children of the world clad in the same generic white outfits, singing and holding hands, looking like a Benetton ad as conceived by the Hare Krishnas. Its primary designer, Mary Blair, was a genius whose artistic gifts were sublimated by the misogyny of the Disney company, resulting in a life of thwarted ambition that led to her early death from alcoholism-related dementia. And of course, there’s the song, two relentlessly peppy melodies played over the same set of chords, written by the songwriting duo the Sherman Brothers, who also wrote the music for The Parent Trap, Mary Poppins, and The Jungle Book. It’s frequently voted among the most annoying in history, even though it’s probably less so than Walt’s original proposal for the ride, which was to have all the children of the world sing the national anthem in their native tongues simultaneously.  

But no matter how many reasons I can come up with for why It’s a Small World should not move me, no matter how much I cringe when I think about sobbing on a boat ride surrounded by animatronic children, one fact remains: I am still moved. The idea that a group of disparate people from various backgrounds — a brilliant yet frustrated alcoholic, Russian Jewish immigrant brothers, a raging anti-communist and probable antisemite — could come together and present such a simple and united vision of children as a force for peace, is deeply moving to me. The idea that Walt Disney — a man who sold a vision of optimism and progressivism, yet was so contemptuous of his employees’ right to unionize that he voluntarily testified against them in the 1947 HUAC hearings, even firing the animator who created Goofy; the man who is perhaps most responsible for contempt for the little guy being integrated into Disney’s DNA — could set aside his own noxious politics to help present a vision of a better world for children is deeply moving to me. 

The reminder that we were all children once, that we all started out believing in a better world, undergirds so much of Disney’s best work. I’m thinking of the final scene in Mary Poppins, when the wealth-and-status-obsessed banker father finally presents his children with the kite they’d been begging him to mend; or the moment in Snow White and the Seven Dwarves when the orphan Snow White has narrowly escaped a violent death, and she’s scared and alone in the forest until she meets a bunch of woodland creatures and vows to stay resolute, the chirpy orchestral chorus for “With a Smile and a Song.” “There’s no use in grumbling when raindrops come tumbling/Remember you’re the one who can fill the world with sunshine,” she sings, as the bunnies wag their tails and the chipmunks scrunch their noses and the birds marvel at the beauty and the robustness of the human spirit. 

Every time I sing those words to my own kids — and I mean every time — I can’t help but tear up a little bit. Because it’s not a message of blind optimism or shiny, happy ignorance in the face of despair or anything else people like to accuse the Disney corporation of promoting — or which it has arguably promoted in its approach to things like the Don’t Say Gay legislation. It’s a message of power. You are the one who can fill the world with sunshine. You are the one who can use your own imagination to remake the world however you see fit. It’s a message I wish I had taken more to heart when I was an anxious, sad, scared little kid; I wish I had believed that I could have built my own magic. Frankly, had I done so, it probably would have saved my parents a lot of money. 

Over and over and over again, I continue to give Disney money, because Disney continues to make things that move me. I believe in Disney magic. I believe in the power of smart, creative people coming together to tell good stories in new and interesting ways, to teach us who we are and who we were and who we would like to be; and in the capacity to reinvent the world as long as there is imagination left in it.

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Correction: This article previously stated that Bob Chapek’s contract was not extended in 2022. While it was extended, he left the company shortly thereafter.