Disney Announces Dramatic Restructuring, Slashes Thousands of Jobs on Same Day DeSantis Says 'There's a New Sheriff in Town'
Reality is storming the gates of the Magic Kingdom.
Highlighting the new, less-reverent world in which the company functions, Florida Gov. Ron DeSantis noted on the same day massive layoffs were announced that Florida will no longer roll over for Disney to give the company a free ride, according to Fox Business.
Disney’s sprawling resort complex in Central Florida has functioned as a largely self-regulating island under the auspices of the Reedy Creek Improvement District, a status that is coming to an end as the state moves forward to end that privileged status.
“Disney’s going to pay its debt,” DeSantis told reporters during a news conference Wednesday in Ocala, Florida.
“What I said really for the last six, nine months is Disney is no longer going to have self-government,” the governor said. “They’re not going to have their own government. Disney is going to pay its fair share of taxes, and Disney is going to honor the debt, and that’s exactly what this proposed piece of legislation will do.
“If you remember when we first went down this road last spring, a lot of folks in the media were saying that, ‘Oh my gosh, Disney’s actually going to pay less taxes and Floridians are going to pay more taxes.’ They were saying that, and I’m like, ‘You’ve got to be kidding me.’
“Well, this puts that to bed. And so those debts will be honored and those will be paid now. This is obviously now going to be controlled by the state of Florida, which is no longer self-governing for them.
“So there’s a new sheriff in town, and that’s just the way it’s going to be.”
DeSantis has clashed with Disney since the company lobbied against the Parental Rights in Education bill he pushed last year.
The company’s stance in favor of LGBT instruction for young schoolchildren has put it at odds with many parents.
The governor’s remarks about putting the Reedy Creek Improvement District under state control came the same day Disney announced it is restructuring to cut costs, according to CNBC.
By cutting about 7,000 jobs, the entertainment giant will be trimming around 3 percent of its workforce. The company employs about 220,000 people around the world with 166,000 of those in the United States.
Disney is cutting $5.5 billion in costs, which includes $3.5 billion from content areas other than sports and $2.5 billion from non-content cuts.
“We must return creativity to the center of the company, increase accountability, improve results and ensure the quality of our content and experiences,” Disney CEO Robert Iger said on an earnings-related conference call, according to The New York Times.
“We are going to a really hard look at everything we make [in general entertainment] because things in a more competitive world have simply gotten more expensive,” Iger said, according to Variety.
The new approach translates into a reorganization into three divisions — Disney Entertainment covers its media and streaming services; ESPN; and a Parks, Experiences and Products section, according to CNBC.
Iger said making ESPN a self-contained unit was not a prelude to selling the sports media enterprise.
“We did not do it for that purpose. ESPN continues to create real value for us. We just have to figure out how to monetize it in a disrupting world,” he said, according to the Times.
The Times noted that ESPN had upwards of 90 million subscribers a decade ago, but that has dropped to around 75 million.
According to CNN, the Disney+ streaming service also lost subscribers, but the drop from 164 million to 162 million was only 1 percent in the last quarter.
“The streaming business, which I believe is the future and has been growing, is not delivering basically the kind of profitability or bottom line results that the linear business delivered for us over a few decades,” Iger said.
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