LOS ANGELES – In hindsight, former Disney CEO
Michael Eisner calls his decision in 1995 to buy CapCities/ABC, and with it, its crown jewel ESPN, "one of the best acquisitions maybe of that whole century."
Eisner says he was certain even back then that the sports network would take off, although it's easy to say so now that ESPN accounts for about half of
Walt Disney Co.'s profits.
"We spent the $19 billion because we wanted ESPN," he said in a recent interview centered on Tuesday's release of his book, "Working Together: Why Great Partnerships Succeed." "It wasn't an accident, no."
According to Eisner, 68, he met then-CBS Corp. CEO Larry Tisch, billionaire investor Warren Buffett, and CapCities/ABC CEO Tom Murphy in rapid succession at an annual get-together of media moguls in Sun Valley, Idaho. The men discussed a possible acquisition, and Eisner was faced with deciding which broadcaster to buy.
CBS, he recalled in the interview, "would have been half as expensive" as CapCities/ABC, but ESPN's growth rate was explosive and becoming more important.
"It wasn't even a question," he said recently.
Every time he had checked up on ESPN with Murphy, actual results blew past expectations, Eisner said.
He jumped on ESPN, which continues to notch impressive growth each year. The market research firm SNL Kagan expects the channel to pull in $6.9 billion in revenue this year, up from $5 billion in 2006.
CBS, which owns multiple channels, is bigger but has nowhere near the trajectory. Wall Street analysts surveyed by Thomson Reuters expect revenue this year of $14.1 billion, down slightly from four years ago.
In "Working Together," published by News Corp.'s HarperCollins, Eisner highlights 10 successful partnerships. Among them is his own with late Disney president Frank Wells. He also cites Buffett's with Charlie Munger, as well as Bill Gates with his wife, Melinda.
Eisner spoke about enduring partnerships and what makes them tick.
"Being in the foxhole together, having common enemies, high-fiving your accomplishments together, being able to commiserate with somebody on a daily basis," he said.
Eisner resigned as Disney CEO in 2005 after leading the media and theme park company for 21 years. He led Disney to huge success in the 1980s but in his final years clashed with dissident stockholders including the founder's family.
Eisner declined to comment on his future endeavors, other than to say that anything big will require another partner.
"I'm sure before I am finished my career, if I do anything of size, I will be doing it with other people," he said.
