Tuesday, April 1, 2008, 8:51 AM ET|Posted by Will Richmond
In a startling development, VideoNuze has confirmed that The Walt Disney Company has decided to sell its ABC television network to Apple CEO Steve Jobs, who is also Disney's largest individual shareholder. Disney is planning to devote most of the billions in proceeds to developing broadband-delivered video webisodes.
The sale, which was unexpected, is certain to ripple throughout the entire media and technology landscape. It is a highly unorthodox transaction that experts believe will be heavily challenged by other Disney shareholders who will claim the deal exceeded CEO Bob Iger's individual authority.
The deal was concluded following a high-stakes poker game held at Iger's Brentwood, CA mansion on Saturday night, in which Jobs and other media and technology industry heavyweights participated. Though the Iger-Jobs relationship has been described publicly as cordial, apparently a series of raises, bluffs and too many scotches laid bare a simmering rivalry between the two moguls.
VideoNuze has learned that with no limits in place, the two CEOs became embroiled in a titanic game of 7 card stud, leading to a round of ante raising that left other players - who had long since folded - gasping. With their chips exhausted, Iger is said to have wagered his double titanium American Express card with a $1 million dollar limit, only to be matched by Jobs placing his unique gold-plated iPhone (believed to work on a private AT&T Wireless frequency that AT&T granted to Jobs in order to gain the lucrative iPhone exclusive) on the table.
Within minutes Jobs further raised the ante by offering up all of his Apple shares. Unable to see the multi-billion dollar raise, Iger and Jobs were able to shake hands on a preliminary deal, allowing Iger to throw ABC into the pot, seeing Jobs's Apple shares. When Jobs revealed 4 aces to Iger's 4 kings, the lawyers were summoned to begin papering the deal.
Explaining what will surely be viewed as a rash move, Iger is said to have told Disney executives that from a strategic perspective his bet in fact made sense. His rationale: that the first month of results from Stage 9, Disney's new digital studio provided him ample data that broadband-delivered video was worthy of its hype and that he wanted to go "all in" with a multi-billion dollar commitment. That thinking left Wall Street observers stunned, as the only Stage 9 program that has launched to date is the comedy short, "Squeegees." The program has garnered several hundred thousand views on YouTube, but has generated no revenue.
Commenting on the deal, VideoNuze's Will Richmond said "Look, I've been saying for years that broadband video was going to remake the media landscape and take over the world, but I just can't believe Iger could have lost ABC to Jobs in a poker game." He continued, "I can only conclude the whole episode is just an April Fool's Day joke."