King Eisner, Prince Iger

At last, the Magic Kingdom is losing its king -- though ever the marketer, Michael Eisner used his resignation letter to Disney’s board of directors to promote an upcoming book and his son’s new feature film.

It’s hard to quibble with the choice of Robert Iger to succeed Eisner at the helm of the iconic entertainment company. He’s a Disney veteran credited with turning around the ABC network and building ESPN into a moneymaker. By all accounts, he plays better with others than Eisner, which will be important given Eisner’s penchant for antagonizing talented individuals whom Disney couldn’t afford to drive away. And as Jeffrey Immelt has shown at General Electric, former lieutenants who follow in the footsteps of larger-than-life CEOs can break from the past and assert their own leadership style.

Eisner, who will be leaving the company in September, will long be remembered as one of the dominant late 20th century imperial CEOs. In an era when compensation was tied to stock performance, Eisner was paid as if he owned the company (earning $1 billion over two decades), and he began acting as if he did. He put his own architect and lawyer on the board, as well as the principal of a school that his children had attended. The lax corporate governance helped spark the shareholder revolt that ultimately forced Eisner out as chairman and led cable giant Comcast to think that a wounded Disney was vulnerable to takeover.

Eisner’s critics never admit that his hardheadedness cut both ways. He managed to stand strong against the irrational exuberance of the dot-com era, and he refused to follow in the footsteps of Gerald Levin, the former Time Warner chairman and chief executive who gave away the company to buyers peddling an inflated stock.

Eisner forged a clear vision for Disney and is bequeathing a far stronger company than he took over, though he would have been more successful had he not struggled so much with the idea of handing over the keys to the kingdom. Over the years, Eisner attracted -- and subsequently lost -- several potential successors, including Jeffrey Katzenberg (now a Disney competitor in animated films), Michael Ovitz (whose messy departure is the subject of a bitter court battle) and Steve Burke (now Comcast’s chief operating officer).

Disney also is estranged from Miramax founders Harvey and Bob Weinstein, who contributed nearly 250 Academy Award nominations and more than 50 Oscar wins to the Disney legacy, and risks losing a profitable animated film relationship with Steve Jobs and Pixar. Hence, diplomacy will need to be Prince Iger’s top priority.