On October 12, 2005, Apple and Disney shocked the entertainment industry with a groundbreaking agreement that allowed consumers to buy primetime television shows digitally for mobile viewing without the need for antennas or multichannel subscriptions.
Two decades later, former Disney Media Networks co-chair Anne Sweeney reflects on that pivotal deal, highlighting its unexpected ramifications for various sectors of the industry.
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“To suggest that many challenging discussions followed the announcement would be an understatement,” she mentioned during an interview marking the anniversary of the transformative agreement on the most recent episode of Variety’s “Strictly Business” podcast. “This literally shifted our media landscape dramatically.”
Sweeney detailed her secretive negotiations with Apple’s co-founder Steve Jobs that enabled the release of hit shows like “Desperate Housewives” and “Lost” for $1.99 per episode, available for viewing the day after their ABC debut on the first video-enabled iPod. This deal set the stage for a streaming revolution that had not yet been realized, as Netflix was then still primarily focused on mailing DVD rentals.
Crafting a precedent-setting contract with Apple, a company whose relationship with Disney CEO Bob Iger had only recently begun to improve, was a challenging feat. Sweeney also faced numerous legal inquiries from local television stations and pay-TV distributors, all of whom were affected by this novel partnership that she needed to justify.
One of her most rewarding experiences was direct engagement with Jobs, who passed away 14 years ago this month. She recounted a particular negotiation moment that was both unsettling and enlightening.
“When I presented a specific deal term to Steve, he reacted explosively,” she recalled. “He exclaimed, ‘Why would I ever do that? That’s contrary to our operations!’ It became clear we needed to innovate collaboratively; this wasn’t just about making our content available on the video iPod; it was about establishing a future blueprint.”
During her tenure at Disney, Sweeney managed a diverse array of business sectors including broadcast, cable, film, news, and sports. She departed Disney in 2015 and currently serves on the boards of several companies such as Netflix and Lego.
“Strictly Business” is Variety’s weekly podcast that features discussions with industry leaders regarding the media and entertainment business. (Subscribe to our complimentary newsletter here.) New episodes are released every Wednesday and are available on platforms such as Apple Podcasts, Amazon Music, Spotify, Google Play, SoundCloud, and more.
(Featured image: Apple CEO Steve Jobs introduced the groundbreaking Disney-Apple agreement for the video iPod on October 12, 2005, in San Jose, California.)
