Disney studio chief quits after ’John Carter’ bomb
Friday, April 20, 2012
LOS ANGELES (AP) — Disney movie studio boss Rich Ross stepped down on Friday, taking the fall for at least a couple of over-budgeted bombs as Hollywood shies away from taking risks on big blockbusters.
His resignation comes after two years in a row of nasty March surprises, ironically both having to do with the Red Planet. Last year it was “Mars Needs Moms,” a creepy animated movie that lost $70 million. This year, it was “John Carter,” a sci-fi action movie set on Mars that resulted in a $200 million loss for Disney.
Ross, 50, said in a memo to staff that he no longer believed his role as chairman of Walt Disney Studios was “the right professional fit.”
The move was not surprising to analysts, coming a few months after studio marketing chief MT Carney also departed because of a string of lackluster releases.
Disney CEO Bob Iger, who said last summer that big-budget movies were getting “increasingly more risky,” thanked Ross for his years of service.
The Walt Disney Co.’s stock increased 27 cents to close Friday at $42.35.
Disney’s most successful movies recently have been made by studios it has bought, including “Toy Story” maker Pixar, which releases “Brave” in June, and Marvel, which will release the much-buzzed “The Avengers” overseas next week.
Under the Touchstone brand, Disney also distributes movies made by Steven Spielberg’s DreamWorks production company, including “War Horse.”
Fixing problems at the studio is seen as crucial for the company, because movies launch characters that are developed into Disney toys, theme park rides, books and video games. For example, “Cars Land,” an attraction based on the Pixar movies, will open at Disney California Adventure in June.
“For Disney, it feeds a lot bigger value chain,” Sanford C. Bernstein analyst Todd Juenger said. “This is a more significant move for investors of Disney than it would be at other companies.”
Although some of Ross’s troubles stemmed from films put into production by his predecessor, Dick Cook, analysts said his inability to prevent big losses was what led to his exit.
“At some level he takes responsibility for not fixing them or shutting them down,” Needham & Co. equity analyst Laura Martin said. “They need to lower the risk of entry and build franchise films from that base. Not go all in, hoping it works out.”
Part of the estimated $250 million budget on “John Carter” can be attributed to the notion that the movie could become a multi-part series, as it was based on a trove of books by the late Edgar Rice Burroughs. The series began with “A Princess of Mars” in 1917 and carried through to the posthumously published “John Carter of Mars” in 1964.
The movie starring Taylor Kitsch had a budget that rivaled what 20th Century Fox spent on “Avatar.”
But “John Carter” made only $269 million at box offices worldwide while “Avatar” took in $2.8 billion. After splits with theater owners and marketing expenses, Disney has said “John Carter” would cause a studio-wide loss of $80 million to $120 million in the January-March quarter.
Ross had taken the job just two and a half years ago with a mission to cut costs and develop new hits. He had brought “High School Musical” and “Hannah Montana” to TV audiences when he headed Disney Channels Worldwide.
Ross spent much of his early tenure at the studio cutting costs and canceling projects that weren’t seen as important to the Disney brand.
He shut down the San Francisco-area motion-capture facility used to digitally animate Jim Carrey’s Scrooge character in “A Christmas Carol,” sold the award-winning Miramax label to outside investors, and cut such movies as “20,000 Leagues Under the Sea” and “Wild Hogs 2” from the development slate. Last year, he suspended production on “The Lone Ranger,” starring Johnny Depp, until its budget was trimmed.
But those efforts were overshadowed by movies that were released but failed to excite big audiences, including “Prince of Persia,” “Prom,” “Secretariat” and even “Winnie the Pooh.”
Ross told staff in a memo Friday that “the best people need to be in the right jobs, in roles they are passionate about, doing work that leverages the full range of their abilities.”
“I no longer believe the chairman role is the right professional fit for me.”
Iger wished him well in a statement.
“Rich Ross’s creative instincts, business acumen and personal integrity have driven results in key businesses for Disney,” Iger said. “I appreciate his countless contributions throughout his entire career.”
Ross’s resignation is effective immediately. Disney did not name a successor.
A couple possible candidates for elevation at the studio are John Lasseter and Ed Catmull, who together built Pixar from a computer imaging company into an animated movie powerhouse. After Disney’s acquisition in 2006, the men have top jobs overseeing animated movies at Pixar and Disney.
The men have helped Disney’s animated films move “in the right direction,” according to Don Peri, the author of a couple books on Disney animators including “Working with Disney.” He declined to speculate on whether they would make good studio heads.
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