Good evening, I'm Dylan Byers.

Welcome back to In the Room, my biweekly private email on the inner workings of American media. Tonight, a conversation with my esteemed colleague Bill Cohan about Disney’s succession drama (and why Bob Chapek isn’t going anywhere); why David Zaslav might be in trouble with Wall Street; and our predictions for Sun Valley next month. I’ll be in attendance, as usual. If you’d like to grab a coffee, just drop me a line.

William D. Cohan: I hope you are having a nice week off, Dylan. You deserve it. Regarding succession at Disney, it all feels way too premature to me. Doesn’t it? Chapek is not exactly lighting the place on fire and the Disney stock is down 60 percent year-to-date, which makes him vulnerable to talk about Iger’s return or the fact that he may soon be replaced. But it’s also worth noting that of the 30 or so research analysts who cover Disney, 20 of them have a “buy” rating on the stock, with an average stock price target some 50 percent higher than where the stock is trading now.

In other words, the Wall Street research crowd, which isn’t always the most objective, isn’t calling for his head and in fact thinks that the company’s prospects are rather grand as people get back to Disney’s amusement parks and back into theaters to watch Disney’s movies. Most of the time, if you still have Wall Street on your side, you can weather the storm, absent fraud or immorality, especially at an establishment company like Disney. Plus, Disney likes to give its chief executives a long leash. Iger was C.E.O. for 15 years. Michael Eisner was Disney C.E.O. for 21 years. Chapek is just past his second-year anniversary. So, unless there is another major screw up on his part, I’m not sure I see a catalyst for an early departure, although there certainly could be one that crops up out of the blue.

As for a Chapek successor, maybe Dana Walden will be the one, but let’s check back in another ten years or so. She’s probably being a little too aggressive on the publicity front at the moment, though. Nobody likes that inside a company like Disney.

Byers: That all sounds right. I also think there’s going to be a steep learning curve for Walden whenever the time comes to have this discussion. Disney TV is just a fraction of a business that also includes film, parks and resorts, and so on. The degree of difficulty is high, and at a minimum it requires several years under the tutelage of your predecessor. After all, Iger spent five years as Eisner’s C.O.O., effectively overseeing the business for half a decade before he was actually given the top title. (On that note, I wonder if it would have behooved Chapek to keep Iger a little closer during his final year at Disney.)

Cohan: Back in the day I spent two years working for Disney, restructuring the finances of EuroDisney, the theme park outside of Paris that the company badly bungled both in its financial structure and in its substance. For instance, it forbade patrons, the French, from drinking wine at the park, which was a culturally tone-deaf decision.

Anyway, at that time, Disney was run by the powerful troika of Eisner, Frank Wells, and Richard Nanula. They were effective. Then Wells died in a helicopter crash and Nanula, who many thought might be the first Black C.E.O. of Disney, blew himself up in a scandal that still boggles the mind. I remember working closely at the time with Tom Staggs, who, like me, was down in the weeds with the numbers. Suddenly with both Wells and Nanula gone, people were talking about Tom Staggs as a potential Disney leader, until he was defenestrated too. So as with any corporate succession intrigue, there’s many a slip between cup and lip. For better or for worse, I think we just have to hang in there with Chapek for the time being, unless either the stock price takes another step function down or he commits another preventable gaffe.

Byers: I think the string of preventable gaffes is what has Hollywood insiders buzzing in my ear about Walden’s ascent to the top of the Magic Kingdom, at least five if not ten years too soon. Whatever Wall Street’s confidence level, there’s a real sense in Hollywood that Chapek’s early tenure has been anything but smooth sailing—and obviously a stark contrast to the very polished, well-coiffed leadership of his predecessor.

Byers: I definitely hear that anxiety a lot these days, and the same people who were bullish on Zaz’s new empire in the runup to its launch now concede that he has an extremely hard road ahead—especially in this economic climate. Zaz and his ax man C.F.O. Gunnar Wiedenfels are moving aggressively, of course: HBO Max unscripted will likely get cut, as I reported last week. I’m not sure that CNN Films survives, either, despite Chris Licht’s assurances that there will be no layoffs in his shop. Still, all this is just nibbling around the edges of that $3 billion. And I’d like to be able to tell you that they’ve got a really easy plan for ripping off the band-aid, but obviously they don’t.

Cohan: Obviously the $55 billion of debt and the $3 billion of synergies were the price of admission for Zaz to get AT&T to do the deal with him. And I’m sure these were heavily negotiated deal points. It was crucial for AT&T to get rid of a big chunk of the $180 billion of debt that C.E.O. John Stankey amassed during the buying spree that brought both TimeWarner and DirectTV to AT&T. Getting rid of $55 billion of debt is one of the only real feathers in Stankey’s cap these days. AT&T shareholders don’t have much to crow about in the past five years—the stock fell 30 percent during that time—but the stock is back up nearly 5 percent this year in an otherwise horrendous market. I just worry that even though Stankey and AT&T did a faceplant on the TimeWarner deal, in one of the larger value destruction moves of the decade, he didn’t lay an egg on Zaz and Discovery. Again, that $55 billion looms like the Sword of Damocles. Do you think Zaz and his ax man are up to the task of whittling that down? Do you think something like CNN or Turner or one of the other crown jewels could be on the chopping block at some point? Maybe this will be a topic for Sun Valley?

Cohan: Hold on. You’ll be in Sun Valley, covering the conference? What side of the ropes? What possessed you to go there for this, aside from how beautiful Hailey and Sun Valley are?

Byers: I’ve gone every year since 2017 or 2018, always very much on the outside looking in—or rather, waiting for the inside to come out and have a cup of coffee. The conventional wisdom among media reporters seems to be that it’s useless to go to Sun Valley because reporters aren’t allowed access, save for shouting questions at executives as they walk in and out of the Lodge—something I’ve never bothered to try. Anyway, I couldn’t disagree more. It’s far and away the most fruitful annual expense on my T&E report, and the one event I feel like I absolutely need to attend to do my job. And that’s not because it yields stories in the moment, but because those 15-minute coffees on the sidelines foster source relationships that enhance my perspective on everything I cover, and yield a fair amount of scoops and exclusives later down the line. For a media reporter, skipping Sun Valley feels a bit like an N.F.L. reporter skipping the combine. You can get away with it, but I’m not sure why you’d want to. Maybe one day Herb Allen will loan me a vest and give me 5 minutes to come in and check out the bar, but either way I’ll continue to make the annual pilgrimage regardless. And yes, the Sawtooth is beautiful in the summertime. There are worse ways to spend a week in July.

Cohan: Any predictions for the conference?

Byers: Given the state of the world today, I’m anticipating a lot of discussion about headwinds, and what to do about them. Economic headwinds, political headwinds, regulatory headwinds, the sad state of the market, Covid and post-Covid disruptions, the crypto crash, the Netflix correction and the streaming subscriber ceiling, so and so forth. Then, more specifically, all the things you and I like to talk about: Chapek’s fate at Disney, how Zaz is going to save WBD stock, what Brian Roberts might buy, whether Shari Redstone is ready to sell. And there’s always some unforeseen drama that gets tongues wagging. It is summer camp, after all. Anyway, I’ll be sure to keep you posted.