EISNER EXPLAINS EVERYTHING
By JOHN HUEY REPORTER ASSOCIATES JOE MCGOWAN, THERESE EIBEN PHOTOGRAPHS BY LOUIS PSIHOYOS-MATRIX

(FORTUNE Magazine) – Last July, after Michael Eisner's angiogram confirmed that he would have to undergo an emergency quadruple-bypass operation, doctors at Cedars-Sinai Medical Center in Los Angeles gave the 53-year-old CEO of the Walt Disney Co. a few minutes before surgery to be alone with his wife of 27 years, Jane, and their three sons. His thoughts turned to his job. "I made a list of candidates to replace me, and gave it to Jane," he recalls. Today, only he and Jane know whose names were on that list, but some of those who didn't make it have become all too apparent, most noticeably Jeffrey Katzenberg, whose noisy departure as chairman of Walt Disney Studios in August still has Hollywood buzzing.

We can only guess at whose names made the list--Michael Ovitz? Barry Diller? Warner's Terry Semel? But the very notion of Eisner drawing up a secret succession document while the surgeon's scalpel was poised over his chest is in itself "high concept." That now standard Hollywood term, which he coined while an executive at Paramount, refers to an idea so simple and captivating that it can be pitched in one short sentence. Fittingly, Michael Eisner is, himself, high concept. And this is the concept: Love him or hate him--and more and more people are having to line up in one camp or the other these days--it's easy to make the case that he has the best job in corporate America, if not the world.

Bill Gates recently wrote that he thought he had the best job in the world. But how many of us would honestly rather peddle software and fight with the government all the time than test the new Indiana Jones ride at Disneyland over and over to make sure the sound effects and wall of rats work just right? Debate Jim Manzi of Lotus in an editorial face-off, or choose an architect for a mammoth new resort hotel to be made from logs? How about this: present software awards at the Comdex convention in Atlanta, or hang out with the cast at the opening of your new Broadway hit, based on characters you'd helped develop? No, unless you really are the kind of person who as a kid dreaded weekends because there was no math class, Eisner wins hands down.

Perhaps a better way of putting it is that, in completely reinventing the Walt Disney Co. since he took charge in 1984, Eisner has made his job into the best in the world. And here's the news, which only gives our walking high concept more lift: Over the past 12 months this guy with the great job has done more than survive one of the most incredible chains of calamities to ever hit a company and a chief executive in such a short time. Despite what his growing list of enemies would like you to believe, Michael Eisner is still riding tall in the saddle at Disney--if anything, taller, and tougher, than ever. Earnings are robust, and Disney stock is trading near an all-time high.

There is this, however: A year ago Disney had in place a management team that was the deepest, most stable, most experienced in the industry; today it has the least known, least experienced, and--in appearance, anyway--least stable team in the business. Also this: Disney's competitors--among them, Rupert Murdoch, Viacom, and Time Warner (owner of Fortune's publisher)--all are piling up diversified distribution assets, such as networks and cable systems, in a play to control the future of the entertainment business. Eisner, so far among the big boys, stands alone in putting virtually all his chips on content.

No one disputes Eisner's dazzling ten-year report card: In 1984 the dilapidated company that he and his partner, the late Frank Wells, took charge of depended on the cyclical theme-park business for almost 80% of its operating income and on movies for only 1%. Eisner's revived Disney earns 43% of its income from movies and only 35% from theme parks. The old Disney brought in less than 9% of its revenues from overseas; today's Disney, 23%. The old Disney dabbled in the resort business, with 2,894 hotel rooms; the new Disney offers 21,586 rooms at 21 resorts, is building more all the time, and is headed pell-mell into the cruise ship business.

Also indisputable: With one recent interruption--for the financial debacle at Euro Disney--Eisner has given shareholders a great ride. Disney has consistently reported annual increases in profits and return on equity of more than 20%, and Wall Street has rewarded it by driving its market value up from less than $2 billion in 1984 to more than $28 billion today--bigger than Ford, for example. Meanwhile, Eisner's pay-- while keeping him far below Gates' billionaire status--has been directly linked to the company's performance and, thus, damned good. In his decade at Disney he has pulled down some $300 million before taxes, much of it in stock that increased some 15-fold under his management. He's also still sitting on 10.9 million shares, worth roughly $600 million pretax. What's more, Eisner's enviable record has afforded him a sovereignty as CEO that is the elite province of only a few corporate chieftains--say, GE's Jack Welch or Coca-Cola's Roberto Goizueta. "The board doesn't control Disney, and the investors don't control it," says Barry Diller, his friend, ex-boss, and possible partner in buying a network. "Michael controls it."

That he has retained such a grip is all the more remarkable given the almost biblical troubles he and his company have endured for the past year or so. As Eisner recalls it, in shorthand, "You have an economic cloud in Europe, and then the president of the company dies, then you have a kind of Shakespearean revolution going on inside the company, and then, on top of all that, you have a health problem . and God was playing his hand too, with fires and earthquakes in Southern California . then the tourist murders in Florida."

Now a little elaboration. The "economic cloud in Europe" was the disaster that Euro Disney became; so far it has cost Disney more than a half-billion dollars in write-offs, not to mention an enormous drain of energy and serious damage to reputation. The president was Frank Wells, Eisner's partner from the beginning at Disney, whose death in a helicopter crash last Easter was the toughest blow, and biggest business problem, Eisner ever had to confront--until just a few months later when he found himself staring his own death in the face (and making that list) at Cedars-Sinai.

The Shakespearean revolution, of course, is the acrimonious departure of Katzenberg, really more of a soap opera (see below). The earthquake, fires, and murders are all terrible human tragedies to be sure, but they also happened to significantly deflate theme-park attendance in California and Florida. (Eisner even left one trial out of this litany-Disney's America, his pet-project theme park devoted to American history that was run out of old-line Virginia hunt country by local opposition.)

"A lot of things were kind of stacking up," he says. "It tested whether or not we were a company that could deal in failure as well as success. It tested our management. It tested our board. It tested our major shareholders. And, of course, it tested me."

It also changed him, as he went through a series of epiphanies--personal, professional, even managerial--in the course of his unbelievable year. "The truth is," he says, "I went from being young to being old. All of a sudden, I even looked my age. When you go through a period of screwing around with your heart, you realize that you not only aren't immortal, you could have been one of those people who drop dead on the tennis court or in the office at 52. That realization has an impact on you."

On the superficial level, it's certainly changed lunch. Now when he arrives at some favorite power spot like the Grill Room at New York City's Four Seasons, he doesn't even get to look at a menu. His no-fat order has preceded him, and the waiter tells him what he'll be having--he calls it all lettuce.

At a deeper level, though, something else has changed about Eisner, who has always had a reputation for being tough--too tough, many believe. "I have less patience for betrayal than I had," he says. "I deal with a broad range of talent, and if the talent is really there, I will put up with a lot. But there is a whole level of maybe not real talented people who really test you. I am less patient with that group now. And I am a little more confident today to go with what I think is right and wrong."

"Yes," agrees his friend Mike Ovitz, chairman of Creative Artists Agency, "I think he's changed. I think he has gotten tougher, and he's working harder than ever."

This may not be good news for anyone. Says Diller: "Michael is competitive, but he's also paranoid: 85% of his toughness is for good reasons; 15% is over the line. There is an excessiveness that has always bothered me. Disney makes deals that are too tough, and when a deal's too tough, it never works out in the end."

Of his reputation, Eisner says, "Are we being too tough, or are we taking the value we deserve? If we put a man in business by giving him a license for Mickey Mouse, and he had no business before, how much are we entitled to? If you aren't tough, you just don't get quality. If you're soft and fuzzy, like our little characters, you become the skinny kid on the beach, and people in this business don't mind kicking sand in your face. Okay, maybe we've done some things that are a little strong. But frankly, I don't think we're as tough as a lot of other less visible companies."

While everything about Eisner, including his toughness, was being severely tested during this epic year, an equally remarkable situation was developing, almost in a parallel universe. Eisner & Co. were also being sustained by one of the best years in the history of the entertainment business. The company's performance was led by the spectacular success of The Lion King, an animated feature film that cost only about $50 million to make, then went on to become the second-highest- grossing film of all time--and probably the most profitable ever. Simba's simple tale took in more than $740 million at the box office worldwide, plus another $1 billion in retail merchandise sales, reinforcing Eisner's obsession with the importance of synergy among his company's various businesses. That retail figure includes seven million copies of the movie's soundtrack (1994's best-selling album), but doesn't count the home video of the film that went on sale in March, selling an incredible 20 million tapes in a run-up campaign to its first day on the market.

Simultaneously, a middle-aged standup comic named Tim Allen turned into a multimedia gold mine for Disney with the No. 1-rated television show, Home Improvement; a No. 1 best-selling book, Don't Stand Too Close to a Naked Man, published under Disney's Hyperion imprint; and a holiday sleeper hit film, The Santa Clause, which grossed a surprising $144 million for Disney. Add to that Pulp Fiction, from Disney's Miramax unit, and several other successful features, and Disney became the first studio in history to gross over $1 billion at the domestic box office in a single year. Meanwhile, Disney's initial foray into Broadway theater--a stage version of the recent animated hit Beauty and the Beast--has broken box-office records. And just for good measure, Disney released its 1937 classic, Snow White, to the home video market and sold 36 million tapes worldwide.

Some year, huh? If Michael Eisner and the Walt Disney Co. were trying to tell their own recent story, they would probably make it an animated epic, and might well choose the Dickens classic A Tale of Two Cities. Look, there's Michael in chains, dingy and battered, splayed out on the stone floor: "It was the best of times, it was the worst of times..." Then, of course, they could spin it off into a Broadway play, an ice show...

The genuinely tearjerking part of the story would come when Eisner and the audience have to bid farewell to Frank Wells. Of all the events in Disney's epic year, aside from Eisner's life-changing open-heart surgery, the death of Frank Wells had by far the most impact on both the company and its CEO. Wells, the former vice chairman of Warner Brothers, was recruited to Disney in 1984 by Roy Disney--Walt's nephew--and his attorney, Disney director Stanley Gold. Then Wells actually brought Eisner in to be his own boss, though technically both reported to the board. The two executives functioned exceptionally well as a team, and, according to Eisner, Wells was planning to sign a new multiyear contract at the time of his death. Wells had a big job. What many of Disney's critics in the creative community fail to realize is that, with 65,000 employees, Disney is a complex string of businesses: the studios, the Disney Channel, the TV production company; the theme parks in the U.S., Europe, and Japan, along with all their associated businesses--real estate, construction, hotels, restaurants, and corporate sponsors. Then there is the consumer products business, including licensed products, mail order, and more than 300 retail stores; publishing; a record company; and relatively new ventures, such as the live-theater business, the sports franchise, and soon the cruise line. Having put all this together with Eisner, Wells was an integral part of how it functioned. Just as Eisner tracked any creative implications of business decisions, Wells knew the details of every budgetary dispute, contract negotiation, legal problem, or personnel issue.

In a Fortune article four years ago, we described how the team worked: "The two men, both well over six feet tall, tower above most of their colleagues, and they both talk about 120 m.p.h. The place crackles. Eisner, like somebody's younger brother constantly interrupting his siblings' efforts to do their homework, is in and out of Wells's office about 30 times a day. What do you think of this? How about if we did that? Would this work? Good, because I already did it. As Wells says, 'For Michael, I make life easier. For me, he makes life more fun.' "

And then, on April 3, 1994, the partnership ended--suddenly, unexpectedly. "Of all the people at the company to lose," Eisner says, fumbling a bit, even now. "He was so personally loved... Frank was so rare. And we had trust. If you look at the difference between him and others, who I am not going to talk about...I could say anything to Frank about the way I felt. I knew that if we were going to get in trouble, we were going to be in trouble together. I wasn't going to take the rap, and he wasn't going to take the rap. We would take the rap--together."

In addition to what Eisner calls the catastrophic personal shock, he says Wells's death "was also an enormous business problem. And we had to deal with it." At first he rushed out as quickly as he could to try to replace Wells, talking to a number of executives, some from outside Hollywood. He continues: "I knew deep down that wasn't the way to go. I would have loved to have the company continue with Frank and do all these things we'd planned, but if Frank's not here anymore...It's like some people, when they get divorced, they always seem to marry another woman who is exactly like the first wife. And it never works. I decided this was a new decade, and we had to do something different."

There is much debate about exactly what happened next, but it is generally agreed that at this point Jeffrey Katzenberg--who had headed Disney's filmed-entertainment business for years and who had come from Paramount with Eisner--began campaigning for Wells's job and that Eisner let him know early on he wasn't going to get it.

"Jeffrey wanted a job I was not prepared to give him," says Eisner. "So he left the company. That is what happened. I feel badly that it turned into an emotional thing, which I am trying to stay away from, but for our company in the next decade I did not feel that he should be president--for a lot of very logical reasons and also for some intuitional reasons. It was a hard decision, and I didn't make it in one day, and I didn't make it lying in the hospital. Jeffrey wanted to be completely in the spotlight, and he was no longer interested in the team unless he was the captain. I think he was shocked I felt that way, but I believe we had enough information over and over again that he should not have the job. He did not want to admit that was the case."

Having made this decision, Eisner had something completely different in mind. Simply put: fruit-basket turnover. Companies, he says, are like marriages. "They have to be renewed every seven years or apathy sets in." So rather than replace Wells, Eisner decides to split up his duties, giving many of them to Sandy Litvack, a New York litigator whom Wells had brought into the company as general counsel and who now, in effect, functions as Eisner's chief of staff. With Katzenberg gone, Eisner then splits his job--head of all filmed and television entertainment--into parts rather than satisfying longtime television chief Richard Frank's desire to move beyond his old role and have it all. So, just recently, Frank leaves. Then Eisner shocks everyone by bringing in Dennis Hightower, his top consumer products executive in Europe, to run TV, a business in which he has virtually no experience. But, Eisner points out, the move is perfectly consistent with things he already has done, like putting his CFO, Richard Nanula, in charge of the Disney Stores, and moving Paul Pressler from that job to president of Disneyland.

"Would I have liked to have kept Rich?" Eisner asks himself. "Yes. He's a quality guy who has a great relationship with the networks. But I'm up about this. Now at least we have an enthusiastic executive in the job. Dennis is excited to be running TV. He's not disappointed to not be running movies."

"Look," Eisner adds, "I know the network business, and I know the TV production business. And I know what to do with animation. I can help these guys with the creative decision-making. Now when it comes to hiring a new CFO, I'm going to defy my own thesis and go outside for expertise. I have been interviewing different CFOs from all over America. What I need is a gifted, creative financial mind, and I want him inside the house."

Some of Katzenberg's friends deride Eisner's new management team, calling it "Larry, Moe, and Curly." But cooler heads embrace the idea of new blood. Says Herbert Allen, the New York investment banker who has profitably invested in many Hollywood properties, including Eisner's Disney: "After a period of time, management turnover is inevitable in the entertainment business. You look at who's choosing the new management team, and it's the same guy who chose the old one, only he's got more experience. Eisner's going to be as right about the future as he was about the past. As with a lot of people who have done consistently well, it doesn't make sense to bet against him."

Still, after a decade of spectacular success, Eisner's decision to take the road less traveled and build a whole new executive team represents a definite risk--especially given the public awareness of his heart problem this past summer. Not only has he put himself squarely on the spot to keep the creative fires at Disney burning bright, but to the outside world, including Wall Street, he is now Team Disney, and any hint of his inability to perform at full capacity would probably send the company's stock tumbling.

Just three months ago the company held an analysts' meeting that seemed mostly about delivering three messages: (1) We are the Walt Disney Co., not the Jeffrey Katzenberg Co.; (2) Here are a bunch of smart young people who are going to be doing interesting things; (3) I'm Michael Eisner, I'm still in charge, and I'm feeling great. Within two days the stock had risen $5 a share. It has continued to rise and has been trading near an all-time high, although it did take a small dip when Frank's departure was announced.

No one but Eisner and his doctors know the state of his health--and even they can't really predict anything. He is taking more time off and spending more of it with his family at their vacation home in Aspen, Colorado. Still, the Michael Eisner you observe running around these days seems, if anything, more juiced than he used to be. "I think the endorphins are affecting me," he says, referring to his new 45-minute-a-day exercise regimen. "They've made me too energetic. I'm worse than I was before."

Indeed, Eisner seems to be reveling in his new, solo high-wire act, charging from one meeting to the next, turning down an idea for a Broadway play, rebuking the choreographers of a live show at Disney World for lackluster quality, riding the Twilight Zone Tower of Terror to check out a new programming change in the computer-driven thrill ride. And continuing to ride that Indiana Jones jeep over and over until they get it right and ready for the public.

Is it really the best job in the world? Is it fun?

"No. No. It's not fun," says Eisner. "Fantasy is very hard work. To make something fun is hard. It's gratifying. It's satisfying. But fun? No."

He could've fooled us.

"Why is there no conflict at this meeting?" he yells to one group of executives gathered around a conference table. "Something's wrong when there's no conflict!" At an animation meeting, it is he--and no one else--who ultimately decides which direction a particular script is taking.

Diller, who was Eisner's boss at both ABC and Paramount for 18 years, thinks Eisner's creative genius is the best thing Disney has going for it. "Michael looks like Goofy, and he often acts like Goofy, and he's definitely in the body of Goofy," Diller says, "but he's got one of the most smartly spirited minds that I've ever come across. You can see the electrical charges moving from one point to another in his brain. Spectacular instincts. Of course, he's not always right, and when it comes to that he has a somewhat tractionless memory." Diller goes on to say that in all Hollywood, "you can count on one hand the number of people who can read a script and understand the idea and all the risks inherent in it. Michael can do that. And that's gold. He will absolutely make movies that will succeed."

To help himself in that regard, Eisner has made a major exception to his "no experience" strategy in the area of live-action films, where Disney already was struggling--under Katzenberg--with some $500 million in losses over the past five years. Here, Eisner has installed veteran producer Joe Roth, the former chairman of Twentieth Century Fox studios, who scored there with such films as Home Alone and My Cousin Vinny. Unlike the fiery Katzenberg, who did things like stir up Hollywood with his famous 28-page "memo" of 1991 in which he mapped out a draconian strategy for dealing with runaway costs, Roth is seen as more of a mainstream movie guy, and he doesn't mind telling you what he thinks the problems at Disney have been.

"Disney had become the last stop for producers," Roth says. "Producers viewed the Disney message as several things: We won't pay you; we'll boss you around; we're gonna make a lot of movies so we probably won't market yours; and we won't pay movie stars. Hey, it's hard enough to be successful in this business. But when you stick your chin out like that, it's the opposite of leverage." (All of this is a slam at Katzenberg, who declined to speak on the record for this article, saying he's concentrating on his new company, DreamWorks, and is "going 150 miles an hour with the top down and no rear-view mirror." For more, see following story.)

Roth's plan is simple. "We're going to make fewer, better movies, and we're going to expand the definition of a Walt Disney picture to include big concepts and movie stars. We're going to strengthen our brand, and we're going to leverage it. There's damned little leverage in the movie business other than hiring expensive movie stars--and that can be painful."

Most of the questions raised about Eisner's executive shuffling wouldn't even have come up, of course, were he the CEO at GM or GE or PepsiCo. But those companies function in the real world of business. Along with the best job in the world comes the obligation to live and work in the very unreal world of Hollywood, a virtual small town colored by many of the same dynamics as most small towns--gossip, nosiness, family feuding, envy--only more so. Within this little world, almost everyone comes to the party with a flare for the dramatic and a basic insecurity inherent in the work. Then they are driven over the top by the numbers that attach themselves to deals, numbers that tend to have more zeros tacked on to their ends than most deals in bigger towns. Even in that world, though, Eisner has elevated himself to what his friend Mike Ovitz calls a "unique position" in the Hollywood power structure.

In many ways his stature has made him more target than hero. The very mention of his name can stir up intensely polarized feelings. Outsiders should remember that Hollywood is said to be an industry driven at least 75% by revenge. So Eisner is wished ill for a variety of reasons, some spoken and rational: his undeniable arrogance, his dogmatic jingoism for all things Disney, his stinginess and inflexibility in negotiation--some unspoken and emotional: his wealth, his power, his unrelenting optimism, his ability to keep coming up with and tackling bigger ideas, and probably even his height, which, at 6 foot 3, allows him to look down on virtually everybody else in the business. In some ways, the reaction parallels the way the Disney name evokes polarized feelings outside Hollywood: among its hundreds of millions of consumers, a feeling of family fun and fantasy; among those who see themselves as guardians of the culture, a sense of sinister profiteering that exploits shameless sentimentality.

In any case, the ugly truth is that when Eisner's unbroken string of successes at Disney began to unravel in 1992 with the Euro Disney crisis, a lot of people, both inside and outside Hollywood, were happy to see it, particularly the culture press, which viewed the fact that it happened in Paris as proof that God still prefers live ballet to the audioanimatronics of the Country Bear Playhouse.

Inside the company, Euro Disney caught everyone off guard. "We had a generation of executives who had never been around failure," says Eisner. "We had this momentum that never seemed to end. We were climbing this ladder that seemed to have no top. Even I got kind of used to it and comfortable with it."

By the beginning of last year, Eisner's Team Disney knew exactly how public failure on a grand scale tasted. The financial structure under which the giant theme park outside Paris was set up--a total investment of more than $4 billion by all parties-- simply couldn't be supported. "We built too big a park, too nice a park, and too expensive a park," recalls Richard Nanula. "Then we didn't market it well. If we had built fewer hotel rooms at moderate prices, they would have filled up. But we built 5,200 rooms, all expensive."

Since opening in 1992, the park has racked up losses of nearly $2 billion, and even though Disney used lots of other people's money, through separate equity and debt offerings, the parent company has so far written off $625 million from the venture. At one point in renegotiating the financial structure with recalcitrant French lenders, Disney even threatened to close the park. And the agreement it eventually reached to keep it running was good for neither the company's pride nor its pocketbook. Though its lenders forgave $300 million in future interest payments, Disney gave up five years of royalties and management fees, then sold a major chunk of the park to a bottom-fishing Saudi prince, reducing the company's stake in the project from 49% to 39%. Even today, the park remains unprofitable.

Eisner doesn't deny the ego and balance sheet damage. "Euro Disney gave us all a good glass of cold water to the face," he says. But his worry now is that in the aftermath, the company will become too conservative, maybe even gun-shy from its one mammoth misstep. "There's not a meeting goes by that somebody doesn't say, 'Ah, Euro Disney, Euro Disney. Can we afford to do this?' Okay, I've heard it. I can say we've learned. But I really do feel--about business and about life--that everybody has to make mistakes. And everybody should be encouraged to feel that if they make mistakes, it's okay. I have never wavered from the belief that I'm glad we did Euro Disney and that it is a monument to the creativity of our company. But there is a reality of life known as economics, which always comes into the equation no matter how many pyramids you want to climb."

If there's anything gun-shy about today's Eisner, it certainly doesn't show to the outside world. One of the primary reasons for Wall Street's current bullishness on the stock, in fact, is Eisner's aggressiveness on so many fronts. The animation business and all its spinoffs--Broadway, consumer products, home video, and even direct-to-home-video movies such as The Return of Jafar, a cheap knockoff of Aladdin--are a direct play to a swelling demographic bubble: children of baby-boomers. For certain, competition is on the way, from Fox, Warner, DreamWorks, and others, but right now the Disney brand is king with the echo boomers. So far, ten of the top 14 all-time best-selling videos, for example, belong to Disney. And here's a question worth asking: Was The Lion King really that great a movie, or just great timing (and marketing)?

What's more, analysts' eyes light up when Disney talks about the coming videodisk format. The company views it, simply, as an opportunity to resell its whole library.

Doubts will always hang over the future of the highly cyclical, and elastic, theme-park and resort business, but the Street likes Disney's aggressive new approach to marketing to the travel industry--something it's always done poorly in the past. On this front, Eisner may soon launch a huge new animal park in Orlando, and he's already commissioning two $350 million cruise ships. Furthermore, Eisner assures anyone who will listen, Disney's America is a great idea that will be built. "Only this time," he says, "we won't try to build it within 15 miles of [Washington Post doyenne] Kay Graham's country place."

Still to be settled, of course, is Eisner's well-known quest to buy a network--CBS, according to recent rumors--perhaps in partnership with Diller. This would finally move Disney off its content-only strategy and makes even more sense with the anticipated demise of the so-called "finsyn" rules, government regulations that severely restrict the earnings producers of TV programming could realize from buying a network. "It's a good business for us," he says, "at the right price. But we're not going to buy into some scenario of doom. We're not going to overpay and dilute our stock, then wait ten years to get back to where we were in 1995 just to own a network." Of a possible partnership with Diller, he says, succinctly, "Barry is the only person I would ever buy anything with and give him control. The only one."

Also still to be settled is how Disney would possibly cope with the loss of Eisner. For all his trumpeting of the new management team's talent and for all his born-again commitment to exercise and healthy diet, the bypass surgery should have reminded investors that he is mortal and that there is no one at Disney who could succeed him.

After everything that Michael Eisner has been through, you would think the man would be secure about his legacy, but somehow you get the feeling he isn't. One tipoff: all the bizarre buildings he keeps erecting (55 at last count), designed by the most controversial contemporary architects in the world--Michael Graves, Robert Stern (a Disney director), Robert Venturi, and Arata Isozaki, the Japanese architect of the new Team Disney building near Orlando. Entering that particular edifice, he says, "You know, some day this is going to be one of the most important buildings in America." And it's clear that Eisner wants history to associate him with that importance.

Maybe his obsession with erecting cultural monuments stems from some sort of need for cultural approbation. He dismisses as a subject unworthy of discussion the rejection of most things Disney by the cultural elite, but, coming from where he does, it may well bother him. Unlike many Hollywood executives, Eisner isn't nouveau riche, isn't from Brooklyn or the Bronx, and really doesn't seem to be driven by the same things as a lot of his peers.

He was raised on Manhattan's Park Avenue. He prepped at Lawrenceville. His father, Lester Eisner Jr., was a prominent New York lawyer. His grandfather, J. Lester Eisner, was in the rag trade, owning a successful manufacturer of uniforms for the U.S. Army and the Boy Scouts. His other grandfather, Milton Dammann, was CEO of American Safety Razor Co. Eisner discovered America when he went off to Denison University near Columbus, Ohio, where he began as a pre-med student and quickly moved on to become an English major. He wrote and produced plays and was elected president of his fraternity. "I loved Columbus," he says. "I went to my first drive-in movie there. I went to the Tiki Room. Columbus is the reason I'm comfortable in America."

He got his first media job--as a page at NBC in Rockefeller Center--because of his family's friendship with Robert Sarnoff. From there he really did work his way up through TV, holding a series of menial jobs at NBC and then more meaningful ones for Diller at ABC, at that time the distant last-place network. Shows that began on his watch included All My Children, One Life to Live; then, finally, during prime time, Happy Days, Love Boat, Starsky & Hutch, Barney Miller. At Paramount, he and Diller had hits with Saturday Night Fever, Heaven Can Wait, and many more. Successes all, but nothing a nice Jewish boy from the Upper East Side necessarily wants on his tombstone.

It's not easy to say exactly what motivates Michael Eisner. Some friends cite a domineering mother, and others theorize that he's still trying to prove that he has a "serious" job to his father, who died in 1987. He has tons of money, but he will look you squarely in the eye and tell you flat-out that money simply isn't what motivates him. From anyone else, this would register instantly as cosmic disingenuousness, but with Eisner--who often resembles a gangly teenager, dressed in his designer jacket, ball cap, and running shoes--you're tempted for a moment to accept this outrageous irony. Then you stop to think what it would be like to try to take some money away from him . No, the money is definitely part of the deal. Just ask Katzenberg.

Then there's the celebrity. He's got more of that, probably, than any other CEO in the world. As he strolls down Disneyland's Main Street one recent Tuesday night--killing time before a Mighty Ducks hockey game--visitors flock to Eisner almost as if he were Mickey Mouse himself. They get his autograph, inquire about his health, wish him well. He smiles and is gracious, but seems a little awkward with this too.

"You want to see something really weird?" he asks me. Then we walk off Main Street, behind the "set" of Disneyland, into an alley. We climb a set of steel stairs. He unlocks a door, and we enter an apartment, a really gaudy little place, done up in a sort of red-flocked Victorian style. "This was Walt's apartment," Eisner says. "They've always kept it just like he left it, ever since he died [in 1966]. For a long time even his razor was out on the sink. Weird, huh?"

Does he identify with Walt Disney? "No," says Eisner. "You know, Walt Disney was Mickey Mouse. He really was. And there was a little piece of that character that was always in him, just like there was a very similar piece of Kermit in Jim Henson, or Charlie Brown in Charles Schulz. These are pieces of human beings that are very, you know, affectionate, enduring, and interesting. I'm not Mickey Mouse. I'm just an executive."

He's right, of course. He's just Michael Eisner.