Could Steve Jobs Lead Disney?

As soon as Walt Disney (NYSE: DIS) CEO Michael Eisner announced his retirement plans last week, analysts began speculating about possible successors. Apple (Nasdaq: AAPL) CEO Steve Jobs appeared on several short lists.

In a letter last Thursday, Eisner informed the Disney board that he would step down in September 2006. The move was not unexpected, coming as it did after a March shareholders meeting that revealed deep concerns about Eisner's leadership of the entertainment giant.

While Jobs' candidacy has not yet moved beyond the realm of speculation, the possibility intrigues tech and entertainment insiders, raising questions about both Jobs' executive portfolio and the leadership needs of a multi-industry entertainment conglomerate.

A Tale of Innovation

Jobs' one clear connection to Disney comes by way of Pixar (Nasdaq: PIXR), where he holds his second CEO position.

Pixar had enjoyed a long relationship with Disney, collaborating on blockbusters such as Toy Story and Finding Nemo. The five Pixar-produced feature films released by Disney have grossed more than $2.5 billion.

The profitable marriage with Disney is slated to end in 2005. Negotiations on a new contract failed earlier this year, due mostly to copyright and revenue terms.

Analysts have speculated that hiring Jobs might be a good way to bring Pixar back within the Disney fold and reinvigorate a company that has seen competitors such as Fox and DreamWorks cut into the animated film market Disney once monopolized.

Visionary Leadership

Jobs' foray into digital entertainment with Apple also has established his understanding of today's savvy consumers. With the iPod and iTunes, Jobs has helped Apple command a lion's share of the market for digital music hardware and services.

"Steve Jobs is an innovator, a visionary and a man with a demonstrated track record of turning creative ideas into business magic -- shades of Walt Disney himself," Tod Loofbourrow, CEO of human resources software provider Authoria, told MacNewsWorld.

Loofbourrow believes that finding new leaders involves matching the business needs of the company with the talents, skill set and personality of the candidate.

Large Gaps to Bridge

Many factors, however, make a Jobs jump to Disney seem less than likely. Disney posted revenues of $27 billion in 2003, more than four times that of Apple.

The Disney empire also covers a wide array of entertainment businesses, including cable and network television, movie production, radio and theme parks. Jobs might find it a challenge to make the shift from the world of technology and digital media.

What Would Apple Do?

After Jobs' recent health scare, the Macintosh community grappled with worries about new leadership at Apple. The Disney rumors give new edge to those concerns.

According to Fiore Londino of Pareto Consulting, Apple should adopt a two-pronged approach to reassuring customers and investors about the future.

"For the short-term, Apple should work with their public relations experts to assure their stakeholders that Apple indeed has the leadership it needs in the near-term and is implementing an effective succession planning process," Londino said.

"Furthermore, Apple should let their stakeholders know that succession planning now has the attention and commitment of the Apple Board."

Such planning may be a new thing at both Apple and Disney, whose leaders have bucked the trends by holding long-standing leadership roles over many years.

According to Londino, statistics show that from 1992 to 2002 one-third of the CEOs in the Fortune 500 lasted fewer than three years, far less than the tenure of either Eisner or Jobs.