Steve's Other Job - BW on the Pixar-Disney Negotiations
by , 1:00 PM EST, December 9th, 2004
As many Observers already know, Steve Jobs, in addition to his post at Apple, is also the majority owner and chairman of Pixar Animation Studios. For that reason we occasionally point out stories concerning Steve's other job, and today BusinessWeek Online has published an interesting piece about the state of the Pixar-Disney negotiations. In order to fulfill its contractual obligations to Disney, Pixar has to release one more film, Cars, before it can work through a new distribution deal. From the article:
By delaying the release of Cars, Pixar can put off discussions with another studio for six months, figures Prudential Equity Group analyst Katherine Styponias. That could be enough time for a new CEO to have succeeded Eisner, with whom Jobs has had a less-than-cordial relationship in recent years.
Without Cars, Merrill Lynch's Jessica Reif Cohen figures Pixar's 2005 revenues will be cut to $208 million from $253 million. Earnings per share are projected to drop 17%, to $1.63. Operating earnings would go to $145 million from $180 million, she estimates. On the up side, she thinks a summer release for Cars could mean $50 million more in revenues.
So, maybe Jobs was thinking about the bottom line when he made the decision. Then again, he may be thinking about forcing a post-Eisner Disney back to the bargaining table.
There is more in the full article, particularly about the deal Mr. Jobs is looking to cut and about Disney's preparations for a possible post-Pixar era.
The Mac Observer Spin:
We've never taken the position that running Pixar is a big diversion for Mr. Jobs, but his "other job" has certainly become rather exciting in the past year. It seems clear that an Eisner-led Disney will not bow to Mr. Jobs's demands, but we find it hard to believe that Pixar would delay a movie release solely to bide time before Mr. Eisner leaves. After all, there's nothing to stop Pixar from negotiating a new distribution deal after Cars is released.
Either way, Jobs-watchers should have a fun time as the negotiating process unfolds.
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