Disney limps into the fourth quarter

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At this time last year, Walt Disney Co.'s studio division was awash in success from surprise hits like "Pirates of the Caribbean: Curse of the Black Pearl" and "Freaky Friday" to 2003's top money maker "Finding Nemo."

That wave crashed this year, with duds like "Around the World in 80 Days," and "The Alamo" sinking the studio from No. 1 in market share to No. 5 behind such competitors as Sony and New Corp.' Fox, according to Nielsen EDI. Even Midas-touch filmmaker Jerry Bruckheimer disappointed with the high-priced period piece "King Arthur," which made only $51 million domestically but has gone on to accumulate $250 million worldwide. A few bright spots like "The Village" and "Princess Diaries 2: Royal Engagement" weren't enough to pull Disney out of the depths.

Executives at the studio, where $1.5 billion in revenue helped fuel the conglomerate last year, are mounting a full-court press for fourth quarter. They will try and reclaim lost market share and make hits out of the Pixar superhero tale "The Incredibles," Mr. Bruckheimer's action adventure "National Treasure" and the Bill Murray film "A Life Aquatic."

still some hope

"Last year was one of those amazing years that you keep telling yourself all along that it can't possibly last," said Nina Jacobson, president of Buena Vista Motion Pictures Group. "And it doesn't. But all indications are hopeful right now that we'll end the year on an up note."

The drought hit as Disney CEO Michael Eisner came under fire on issues ranging from the ongoing feud with Miramax's outspoken co-chief executive Harvey Weinstein to the impending end of a lucrative partnership with Pixar Animation Studios. Mr. Eisner, while dealing with a hostile takeover attempt by Comcast Corp., was stripped of his chairman title this spring amid a shareholder revolt. He recently announced his retirement by his contract's end in 2006.

"Corporately, they may be distracted, but the marketing department isn't, and the individual directors and producers aren't," said Larry Turman, a longtime Hollywood producer who chairs the Peter Stark Producing Program at the University of Southern California. "But even the hitmakers can't possibly have a hit every time out."

eye on the ball

"The message from Eisner and Iger has always been, `Keep your eye on the ball,"' Ms. Jacobson said. "The boardroom drama may have brought more attention to our ups and downs, but it didn't cause them."

The pressure is on for fourth quarter. "Our movies aren't usually based on comic book characters or franchises, they aren't sequels, they don't often have big stars," said Oren Aviv, president-marketing at Buena Vista Pictures. "We have a lot of concept to sell."

For "The Incredibles" and "National Treasure," Disney has assembled a raft of promotional partners, amassing an estimated $110 million in TV ad spending alone from the likes of McDonald's Corp., Procter & Gamble Co., Kellogg Co., Visa, SBC Communications and Verizon (see related story, P. 79).

Those marketers and additional players Eastman-Kodak Co., Northwest Airlines, Toys `R' Us, Samsung, Hollywood Video, Safeway supermarkets, the Washington D.C. and Philadelphia tourism boards and Get Fit Foods will feature the films in national campaigns and grassroots efforts, from TV, radio and print to online, in-store, direct mail and more. "We have perishable products and we have to make a big impact in a limited amount of time," said Brett Dicker, Disney's exec VP-marketing.

Some of the marketing highlights include an eye-catching two-billboard ad for "The Incredibles" that has the Elastigirl character's arm stretching from one to the other across heavily trafficked streets. For "National Treasure," the studio will launch 60-second ads instead of :30s to explain the U.S.-based treasure hunt premise.

While the 16.6% market share the studio raked in last year seems a distant memory, it could crack $1 billion again for the ninth time in 11 years-but only if "The Incredibles" and "National Treasure" are hits.

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