Business

The Former Electrical Engineer Leading Disney’s Streaming Strategy

Kareem Daniel was on crutches in the spring of 2002. He had broken his right ankle playing basketball. But Mr. Daniel had no time to convalesce: A self-imposed clock was ticking on his attempt to change careers — to abandon safe-and-steady electrical engineering, a field that his parents had pushed, for the wild-and-woolly movie business, which was his dream.

So he hobbled to his car, and stared down a sign on the freeway: Los Angeles, 404 miles.

Mr. Daniel interviewed all over Hollywood and was rebuffed. Just as he was about to give up, he heard about an internship in the DVD department at Disney. It was supposed to be a phone interview, but Mr. Daniel pushed to meet in person. (“I wanted in the room,” he said.) The low-level Disney executive conducting the interview, Bob Chapek, hired him nearly on the spot.

“I’m not here today without that,” Mr. Daniel said. “It changed everything.”

Over the next 20 years, as Mr. Chapek rose to become the Walt Disney Company’s chief executive, the unremitting Mr. Daniel climbed with him — to a rung involving movie distribution strategy; then to business development for consumer products and interactive media; and ultimately to Imagineering, Disney’s theme park design division, and back to consumer products. In 2020, at the height of the coronavirus pandemic, Mr. Chapek made Mr. Daniel the chairman of a new division, Disney Media and Entertainment Distribution, which was created to give priority to the company’s streaming services (Disney+, Hulu and ESPN+) and to guarantee they receive a steady flow of Disney’s best content.

In short, Mr. Chapek entrusted Mr. Daniel with streaming subscriber growth, an all-important task that has come under increased Wall Street scrutiny in recent months, ever since Netflix started to lose subscribers, shaking Hollywood.

It is a colossal job that has made the little-known Mr. Daniel, 48, one of the entertainment industry’s most powerful executives. In some ways, he is Disney’s top content traffic cop, deciding whether $33 billion in annual film and television content gets routed to streaming, traditional TV channels or theaters. Should the next Pixar movie debut exclusively in theaters? Or should it be made instantly available “for free” to Disney+ subscribers? Pixar will be asked for input, but Mr. Daniel and his team will make the final call.

“Ultimately, we will make the best decisions that we feel are right for the consumer,” Mr. Daniel said.

Mr. Chapek also gave Mr. Daniel global operational and profit-and-loss responsibility for Disney’s streaming services, as well as for traditional channels like ABC and ESPN — turf that previously belonged to Disney’s film and television content divisions. He oversees all advertising sales. Mr. Daniel, the first Black executive to run a major Disney division in the company’s 99-year history, also has partial oversight of Disney’s effort to build its version of the metaverse, in which the online, virtual and real worlds coalesce.

It would be enough to stretch even a seasoned C.E.O. to the brink. But Mr. Daniel, a confessed workaholic with a reputation as a tough boss, came across as untroubled in a May interview at Disney’s headquarters in Burbank, Calif.

Never let them see you sweat?

“I’m comfortable being uncomfortable, especially in a new position,” Mr. Daniel said with a smile. “I try to get up to speed quickly, working very hard, trying to understand as quickly as possible what the needs are, knowing that I don’t have to be the expert in a room. I need to manage experts.” (He has nine people who report directly to him. They have an average of 18 years of experience at Disney.)

Movies have always been a passion for Mr. Daniel, and at Disney he has become known for peppering conversations with movie lines.Credit…Adam Amengual for The New York Times

The already intense pressure on Mr. Daniel and his division (referred to as “D-Med” inside Disney) is about to become more extreme. Disney+ has grown to 138 million subscribers worldwide, up from 70 million when Mr. Daniel took it over, but the easy growth is past. This month, Disney refused to pay an exorbitant premium to keep streaming rights to popular cricket matches in India, something that could hamper the company’s quest to reach 230 million to 260 million Disney+ subscribers globally by 2024. Analysts expect Disney to lower that guidance as part of its August earnings report, while doubling down on a commitment to make Disney+ profitable by 2024. Disney declined to comment.

Mr. Daniel’s team is also poised to roll out a cheaper, ad-supported version of Disney+ late this year. But the ad market has been weakening.

Mr. Chapek has confidence in his protégé’s ability to deliver. “Kareem is a Renaissance man,” he said in an email. “When you combine his experience and incredible business sense with his love for the art of storytelling and deep respect for the creative process, it’s a recipe for success.” (While Mr. Chapek has had a difficult year, with Disney becoming a political punching bag and his firing of a senior TV content executive generating criticism in Hollywood, the Disney board is poised to renew his contract.)

But others are less convinced that Mr. Daniel is ready for this big of a gig. Some people inside Disney were stunned by his promotion, noting that Mr. Daniel had only been in his previous role as president of consumer products — a relatively small unit — for six months.

Hollywood’s creative class has been skeptical, in part because the intensely private Mr. Daniel is largely unknown outside Disney. Who is this person with no content creation experience who is suddenly in charge of where our movies and shows end up? For some, his rise seemed to reflect a troubling paradigm shift in the entertainment business — the marginalization of content-creation executives and empowerment of operations apparatchiks pushing data and algorithms.

“People who come from operations are not always sensitive to the heartbeat of our business, which is talent,” said Maha Dakhil, a Creative Artists agent who supports clients like Tom Cruise and Natalie Portman.

Ms. Dakhil, however, decided to investigate for herself. “I made a concerted effort to get to know Kareem and have been pleasantly surprised,” she said. “He is brimming over with high levels of EQ” — emotional intelligence — “and yet he doesn’t pretend to know everything. He’s curious and listens. And most of all, I am convinced that he really does love movies.”

Movies have been a passion for Mr. Daniel since childhood. He grew up on the South Side of Chicago, where his mother was a nurse and father a professor. He spent most Saturdays at the Evergreen Plaza multiplex, once taking in back-to-back screenings of “The Empire Strikes Back.” When it came to picking a career, however, his parents insisted on practicality — hence his dutiful decision to study electrical engineering at Stanford University.

At Disney, he is known for peppering conversations with movie lines, sometimes playfully testing subordinates to guess their origin. He collects original movie posters. Over dinner with a reporter, he discussed the plot intricacies of Paul Thomas Anderson’s “Phantom Thread,” about a couturier in 1950s London, and recited lines from “The Breakfast Club” and “The Color of Money.”

He has attended the Sundance Film Festival 21 times. “He sees more movies at Sundance than almost anyone, and he does it because he loves it,” said Sean Bailey, president of Walt Disney Studios Motion Picture Production.

Much has been made, both inside and outside of Disney, about the ways in which Mr. Chapek’s 2020 restructuring took away power from some (the people running the company’s moviemaking and television production divisions) and gave it to others (Mr. Daniel). Not helping has been confusion in the broader industry about how it all works.

Under the new setup, Mr. Daniel’s group sets a spending budget for Disney’s content factories. Using data and research, his teams also determine what type of content is needed (genre, length, targeted demographics) to drive growth on the company’s various platforms. “We share that with them so that they can go create against those needs,” Mr. Daniel said. “We don’t go to a hyper sense of specificity, of course, because we want to inform the creative process but not try to algorithmically program.”

Mr. Daniel has no further involvement in show or film creation. For instance, he is not calling up Dana Walden, Disney’s top television content executive, and saying, “Hey, I read the latest script for ‘Grey’s Anatomy,’ and I really think you should be making it for $4 million instead of $5 million.”

There have been moments of tension. For the most part, however, Mr. Daniel has navigated the arrangement smoothly. “He’s a charismatic guy who has handled the reorganization with generosity and empathy and intelligence,” Mr. Bailey said. From a numbers standpoint, the growth of Disney+ has exceeded expectations under Mr. Daniel’s watch, while traditional TV channels have also held their own; ABC ended its season as the No. 1 entertainment network.

It helps that Mr. Daniel knows Disney backward and forward.

After starting as an intern, while he was completing his M.B.A. from Stanford, he spent three years as a media-focused associate at Goldman Sachs. He rejoined Disney in 2007, working in corporate strategy (the acquisition of Marvel) and then in film distribution strategy, where he helped shorten the theatrical release window to three months from four, to howls from theater owners.

During his time at Imagineering, Mr. Daniel brought the $1 billion “Star Wars”-related expansions to Disney parks in on budget and supported an ongoing effort to remake one of the company’s most popular rides, Splash Mountain, which depicts characters and songs from “Song of the South,” the racist 1946 musical.

Mr. Daniel may also be the only person at Disney who could quite literally knock Mr. Chapek down and live to tell the tale.

At a recent ESPN town hall, Mr. Daniel was pressed to recount how, at a prepandemic management retreat, he collided with Mr. Chapek while playing softball. Mr. Chapek was playing first base, Mr. Daniel hit a slow roller up the first base line, started running and … kersplat.

“We got a little aggressive,” Mr. Daniel told the ESPN crowd sheepishly.

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