Crowds are down? Curious about the claims . . .

[ford91exploder]

$4B is far from chump change....

That was a stock deal, and EVERYBODY in the Industry asked WHYINTHEHELL did Disney pay so much for Marvel because no one else was even INTERESTED in the property, It was the merger version of an ebay 'Nuclear Bid' The 4 Billion in stock was I think more for Iger's ego than any realistic business reason Just like the 2.5 Billion NFL deal which does not include a Superbowl (The ESPN deal cost 2.5x more than the nearest network and DOES NOT include a Superbowl, Even the cheap 400 Million NFL deal included a superbowl)

Retrospectively I think we can all agree it was a good deal for Disney but the reality is they probably could have bought the Marvel brand for $750M-1.5B

 

[ford91exploder]

I agree with you but it wouldn't surprise me. It's how we got a gimped 7DMT - they decided to save money in the short term and have people leave the ride with, "that was it?," from now until the ride is pulled rather than to just go with a longer track and more complete ride. That was stupid.

Tomorrowland being 1/2 done and never completed. That was stupid.

I think there's also this naïve idea of what "fully funded" means. I get it. In it's most simplistic form you think, "Star Wars land is going to cost $200M (just picking a number out of the sky here). The suits have signed off. It's fully funded and will be built as planned."

This doesn't take into account the BS nature of getting projects approved: You shorten timelines and claim the lowest cost possible to get it done. You're basically saying, "If nothing every goes wrong ever and no person on the project or at any of the vendors ever get sick and everything bolts together perfectly and everything works on the first try..." (though you don't actually say it - you just quote the figure). Sometimes you may actually add extras to it so that when management tells you, "That's too much!," you can then go back and take out the "extras" so that you can get what you actually wanted.

The other side of it, outside of the BS negotiations, are the actual, unplanned things that come to light that hold things up and increases costs.

Forgetting all of that, though, there's the very real notion that something is "fully funded... until it's not." Tomorrowland revamp in the early 90s was fully funded... until it wasn't. Finishing the rest of Pop Century was fully funded.. until it wasn't. Some of these things make sense and some don't.

It'd be like if you and your spouse decided to add a section onto your house and after much thought and planning decided, "Yep! Let's do it!" It's now "fully funded" as you both see the task ahead of you and have agreed to finish it. Then the economy bottoms out and you lose your job and you decide, "OK. We're going to stop at the walls and roof being done so that the rain doesn't come in." Now it's not fully funded.

What amazes me is that they have a park, DHS, which has had a problem since day one which was that it was built fast and cheap to get it out the door before Universal. Then it was allowed to languish for 25 years. Now they're doing upgrades and rather than saying, "Let's do it right this time," they're already starting to pull back, from what I've seen, with TSL. There's no thought as to, "...wait a sec... This is how we got into this mess!," or, "We did this with 7DMT.. Let's just do it right.."

I really think it's all based in taking the spreadsheet to their boss and showing them what they saved. There's no thought for longevity and guest experience, just, "Look at this! I saved $250K! Where's my bonus?"

^^^ THIS ^^^

As a long time corporate warrior this is EXACTLY how things are done in US corporations, things are 'Fully Funded' till they are not and that decision is usually made in an overnight panic about 'not making the numbers' so the CAPEX is canned and the money moved elsewhere to make the balance sheet/income statement look better. Because in the end there is only ONE pot of money and that's revenues. There is no magical CAPEX money, CAPEX can become OPEX or 'Cash and Equivalents' with the twitch of a finger, They are only different because they ar TAXED differently at tax filing time.

 

[Brad Bishop]

^^^ THIS ^^^

As a long time corporate warrior this is EXACTLY how things are done in US corporations, things are 'Fully Funded' till they are not and that decision is usually made in an overnight panic about 'not making the numbers' so the CAPEX is canned and the money moved elsewhere to make the balance sheet/income statement look better. Because in the end there is only ONE pot of money and that's revenues. There is no magical CAPEX money, CAPEX can become OPEX or 'Cash and Equivalents' with the twitch of a finger, They are only different because they ar TAXED differently at tax filing time.

Just to add to it a bit:

In the corporate world you're not rewarded for giving accurate timelines and dollar amounts, even if proven right later. You are looked at as someone who can't get the job done. Even if the other guy ends up taking as much time or more than what you had predicted, you're seen as "can't do" and he's seen as "can do". It's both incredibly dumb and incredibly frustrating. When it's time to bid again, if you give what you think is an accurate estimate and your competition gives a crazy low estimate, he will win every time even if after the fact, each time, he's taking more time and costing more, even more than your estimates. They'll simply chalk it up to, "Well, he's a can-do genius and this must have been harder than we all thought!"

 

[asianway]

There is zero chance of any of that happening.

Permanently shuttering either water park? No.

Rolling closures so only one is open each day? I could absolutely see that.

 

[asianway]

^^^ THIS ^^^

As a long time corporate warrior this is EXACTLY how things are done in US corporations, things are 'Fully Funded' till they are not and that decision is usually made in an overnight panic about 'not making the numbers' so the CAPEX is canned and the money moved elsewhere to make the balance sheet/income statement look better. Because in the end there is only ONE pot of money and that's revenues. There is no magical CAPEX money, CAPEX can become OPEX or 'Cash and Equivalents' with the twitch of a finger, They are only different because they ar TAXED differently at tax filing time.

Certain loan covenants might require the Capex pots be firewalled, but that would be at a much smaller company, more likely private.

 

[ford91exploder]

Just to add to it a bit:

In the corporate world you're not rewarded for giving accurate timelines and dollar amounts, even if proven right later. You are looked at as someone who can't get the job done. Even if the other guy ends up taking as much time or more than what you had predicted, you're seen as "can't do" and he's seen as "can do". It's both incredibly dumb and incredibly frustrating. When it's time to bid again, if you give what you think is an accurate estimate and your competition gives a crazy low estimate, he will win every time even if after the fact, each time, he's taking more time and costing more, even more than your estimates. They'll simply chalk it up to, "Well, he's a can-do genius and this must have been harder than we all thought!"

^^^ THIS ^^^

 

[ford91exploder]

Certain loan covenants might require the Capex pots be firewalled, but that would be at a much smaller company, more likely private.

This would be especially true at a debt funded company but for the moment Disney has little debt on the books.

 

[rob0519]

Permanently shuttering either water park? No.

Rolling closures so only one is open each day? I could absolutely see that.

I agree with the rolling closures. For the short term the annual refurbs on the water parks is coming up so for a few months they will only be running one at a time anyway. A rolling closure would force us to Blizzard Beach for a change. We've been going to Typhoon Lagoon exclusively for years because of the wave pool.

 

[No Name]

April 2, 2007 Monsters, Inc. Laugh Floor
Insert 5 year gap of nothing new at MK here.
February 22, 2012 Sorcerers of the Magic Kingdom - Scavenger hunt... Nothing impressive.
June 15, 2012 Casey Jr. Splash 'N' Soak Station - Water fountains with a statue in the middle... Nothing impressive
December 6, 2012 Under the Sea ~ Journey of the Little Mermaid
December 6, 2012 Enchanted Tales with Belle
March 9, 2014 Disney Festival of Fantasy Parade - .....It's a parade. Not necessarily a new addition.
May 28, 2014 Seven Dwarfs Mine Train - Good, but scaled back a LOT.

November 27, 2006 The Seas with Nemo & Friends - Just an overlay of what was already there
April 2, 2007 Gran Fiesta Tour Starring The Three Caballeros - Just an overlay of what was already there
October 14, 2009 Sum of All Thrills (in Innoventions East) - Good, but tucked in a tiny corner nobody knows about.
June 23, 2012 Agent P's World Showcase Adventure - Scavenger hunt... Nothing impressive
December 6, 2012 New Test Track - Just an overlay of what was already there
June 17, 2016 New Soarin' - Just an overlay of what was already there
SOOOO... There's a decade of countless overlays and one attraction that would have potential if it were the size of an actual attraction
June 21, 2016 Frozen Ever After

October 9, 2007 Jedi Training: Trials of the Temple - This is literally nothing. I could make this show in my backyard.
May 31, 2008 Toy Story Midway Mania!
March 27, 2011 Disney Junior - Live on Stage! - An overlay, but it needed to stay up to date.
July 4, 2014 Star Wars: Path of the Jedi - Something I can make on my iMac and post on YouTube
July 5, 2014 For the First Time In Forever: A Frozen Sing-Along Celebration - Something that can be performed at a birthday party
December 1, 2015 Star Wars Launch Bay - A major downgrade from Magic of Disney Animation.. NOT a step forward
June 17, 2016 Star Wars: A Galactic Spectacular

April 7, 2006 Expedition Everest - Legend of the Forbidden Mountain
January 24, 2007 Finding Nemo - The Musical
May 27, 2016 Sunset Safari - It IS an addition... But it also isn't..
May 27, 2016 Harambe Wildlife Parti - not an attraction
May 27, 2016 Discovery Island Carnivale - not an attraction
May 27, 2016 Harambe Village Acrobats - not an attraction
May 28, 2016 The Jungle Book: Alive with Magic - a bad cover up for the failure of rivers of light.

__________________________________________________________________

UNIVERSAL FOR COMPARISON: No "minor" additions listed

Hollywood Rip Ride Rockit - 2009
Harry Potter and the Forbidden Journey - 2010
Dragon Challenge - 2010, An overlay of what was already there
Flight of the Hyppogriff - 2010, An overlay of what was already there
Despicable Me: Minion Mayhem - 2012, an overlay, but a very impressive one
Kang & Kodo's Twirl n' Hurl - 2013, a carnival ride immersing you more into the land
Transformers: The Ride - 2013
Harry Potter and the Escape from Gringgotts - 2014
Hogwarts Express - 2014
Skull Island: Reign of Kong - 2016
Incredible Hulk Coaster - A MASSIVE EXPENSIVE refurb

Not to mention two AMAAAAZINGLY immersive themed lands. Universal Studios is opening what Disney would consider an "E-Ticket" every 1 or 2 years..​

Well you forgot quite a few things on that very opinionated list. You know, some family with little kids might love the Casey Jr. Splash and Soak station. Heck, it might be the most memorable part of their day!

Similarly, to many people, the Nemo ride was a great improvement over what was previously there. To me? No way. To many of my relatives? You betcha! And the previous ride had been closed for 5 years, so it was certainly an improvement over nothing!

And while you pegged all of the DAK street entertainment as not being attractions, you completely forgot the Tree of Life Awakenings. You completely forgot a lot by the way.

And Minion Mayhem and the carnival ride get a plus while you peg nearly* every single Disney replacement or small addition as being "just an overlay of what was already there" or worse? Come on. I can't even respect your opinion after reading that because it's so obviously and unfairly biased.

I could go on. Point is that your opinion is not reflective of many others'.

* Edit: remove the word "nearly" because you were not positive toward a single small addition or replacement from Disney. Wow.

 

[lebeau]

Are local amusement parks with thrill rides not common? Yeah, Universal has more thrilling rides than WDW, but I can't imagine going to Uni in search of thrills. I didn't realize that "kids have matured beyond WDW, now they want Uni" until I started looking at wdw and universal forums. Cedar Point, Magic Mountain, Busch Gardens WB and Tampa, even Kings Dominion all offer a whole lot more thrills than you'll find at Universal and they're a lot cheaper too.

That's true if all you are looking for is bigger, faster rides with at most minimal theme. If you want immersive thrills, Universal is the best place to find them.

 

[rael ramone]

That was a stock deal, and EVERYBODY in the Industry asked WHYINTHEHELL did Disney pay so much for Marvel because no one else was even INTERESTED in the property, It was the merger version of an ebay 'Nuclear Bid' The 4 Billion in stock was I think more for Iger's ego than any realistic business reason Just like the 2.5 Billion NFL deal which does not include a Superbowl (The ESPN deal cost 2.5x more than the nearest network and DOES NOT include a Superbowl, Even the cheap 400 Million NFL deal included a superbowl)

Retrospectively I think we can all agree it was a good deal for Disney but the reality is they probably could have bought the Marvel brand for $750M-1.5B

Long term, I'm wondering of the possibility of the Marvel deal was a mistake regardless of price.

Reason: Old Man Ike is now a major shareholder of $DIS. The more power he gets, the more likely the cuts will be deeper and much more aggressive.

Crowds down? Calls for a cut.
Crowds back up? Calls for a cut.
And cuts everywhere else in $DIS business units...

As far as the parks go, lower crowds can be a positive or negative based on how you do the parks.. basically if the cuts that WILL accompany the lower crowds will decrease your enjoyment more then the less people in the pathways may increase it.

 

[21stamps]

Well you forgot quite a few things on that very opinionated list. You know, some family with little kids might love the Casey Jr. Splash and Soak station. Heck, it might be the most memorable part of their day!

Similarly, to many people, the Nemo ride was a great improvement over what was previously there. To me? No way. To many of my relatives? You betcha! And the previous ride had been closed for 5 years, so it was certainly an improvement over nothing!

And while you pegged all of the DAK street entertainment as not being attractions, you completely forgot the Tree of Life Awakenings. You completely forgot a lot by the way.

And Minion Mayhem gets a plus while you peg nearly every Disney change as being "just an overlay of what was already there"? Come on. I can't even respect your opinion after reading that because it's so obviously and unfairly biased.

I could go on. Point is that your opinion is not reflective of many others'.

Some of my favorite photos are of me and my kid running around and getting splashed in Casey Jr's splash and soak.
Sure a sprayground isn't unique, but normally I'm not running though one with him. He loved, I loved it- great memories. I don't need a rollercoaster to create a memory. Like I said in another post, a person's view towards an attraction is subjective, so highlighting and holding ones that are important to 'you' doesn't mean everyone feels the same.
----

I read through the last couple pages and I have question-
In June people were complaining that the parks weren't open late enough for the crowd levels. (MK closing at midnight)

So is all of this "Disney is going out of business!!!" "Projects will be stopped." stuff all because 4th of July crowds were lower this year?

 

[Brad Bishop]

Some of my favorite photos are of me and my kid running around and getting splashed in Casey Jr's splash and soak.
Sure a sprayground isn't unique, but normally I'm not running though one with him. He loved, I loved it- great memories. I don't need a rollercoaster to create a memory. Like I said in another post, a person's view towards an attraction is subjective, so highlighting and holding ones that are important to 'you' doesn't mean everyone feels the same.

I think that the difference is in scope. Casey Jr. area is a neat area and great for kids, and possibly adults, especially when it's hot which is about 9 months out of the year in Florida.

Other attractions mentioned are also nice and in that they "add a little something" to the park.

I think that the difference is that while you may have wonderful memories of Casey Jr. or someone may have wonderful memories of some other attraction or feature, it's not something people have a normal conversation about. It's not something that people talk about wanting to go see at WDW. People don't say, "Oh, did you hear? Casey Jr. is open and it looks like great fun to go and splash and play in the circus area!" It definitely can add something while you're there, though, and isn't a bad addition.

I remember when Space Mountain was being built and, as a kid, that's all we talked about. We couldn't wait to get to "Disney World", as it was called back then, to ride Space Mountain. There was buzz about it. BTMRR and Splash Mountain had the same buzz. I remember even Pirates having that buzz, to a lesser extent. Casey Jr. Splash Area, while neat, doesn't have that buzz. Even the NFL only had buzz in Disney fan-specific circles. 7DMT wasn't being talked about at the water cooler except by Disney fans.

Harry Potter has that buzz. Lots of people like Harry Potter and those people were, and are, excited to go to UOF to see Harry Potter Land.

I think SWL has some of that buzz in the Star Wars fan community but it doesn't seem, to me at least, and yes, this is subjective, to be at the same level as the Harry Potter stuff. TSL doesn't seem to have any buzz at all.

I hear more people talk about the Food & Wine festival at Epcot than talk about any other Disney offering, including the new stuff. While the other additions are nice, and do add to it, overall, there's no buzz or excitement.

 

[SorcererMC]

I read through the last couple pages and I have question-
In June people were complaining that the parks weren't open late enough for the crowd levels. (MK closing at midnight)

So is all of this "Disney is going out of business!!!" "Projects will be stopped." stuff all because 4th of July crowds were lower this year?

Pretty much.
To summarize: The ~30% or more attendance drop is possibly unique to WDW, unprecedented, and not a good harbinger of things to come, especially when compared to the record-breaking tourism of the past 3-5 years. Disney will have to take measures to compensate for it by cutting expenditures (OpEx and/or CapEx) - waiting to see how they will respond while considering what they have done in the past (eg rolling closures, staff cuts/layoffs, cutting budgets for planned projects, and discounts galore).

July-Sept is the last quarter of their FY, so not ending on a high note but buffered by the previous quarters. FY2017 could be another story altogether (pre-Iger exit 2018).

 

[psherman42]

I realize there's a lot happening lately, the Pulse shooting, the gator incident, Brazil's struggles, Brexit, etc., etc., but when Disney started raising their prices all the time, I wondered if at some point they'd price themselves out. Is it possible that we've finally gotten there, especially for a place that hasn't seen anything major open in years? How likely is it that Disney freeze prices for a while, or offer discounts?
Sorry for not reading all 26 pages of this discussion to see if this has been mentioned.

 

[SorcererMC]

I realize there's a lot happening lately, the Pulse shooting, the gator incident, Brazil's struggles, Brexit, etc., etc., but when Disney started raising their prices all the time, I wondered if at some point they'd price themselves out. Is it possible that we've finally gotten there, especially for a place that hasn't seen anything major open in years? How likely is it that Disney freeze prices for a while, or offer discounts?
Sorry for not reading all 26 pages of this discussion to see if this has been mentioned.

Others may disagree but my take on it:
It is a combination of those factors, spring attendance was already down slightly (intl tourists down). Orlando tourism in general - after recovering from 2008 recession that hit 2009 attendance, w/ 2010-11 returning to avg (or above) attendance, and 2012-15 booming w/ both NFL and UO Harry Potter opening.

It's very unlikely that Disney will freeze or roll back current prices (barring a catastrophic economic meltdown). They will offer discounts (eg on room and dining) to draw tourists.

Re: pricing. I suspect that the avg FL tourist (age 35-54+ w/ an avg household income of $100,000+) who has visited in recent years is now snubbing their nose at the product being offered (or otherwise not finding value in it, and waiting for more additions), especially in light of recent events which are only exacerbating the issue.
[Edit: I believe that Millennial families want to go to WDW, but only the affluent ones (~15-20%) can afford it right now. It's definitely not akin to Walt's Disneyland anymore].

 

[beachlover4444]

Friends who work for the Mouse say Brazilian groups are not to be seen so far.

Yes I have heard the same thing. CM were not blocked out 4th of July at MK first time in years. CM also can get hotel discounts this June and July, deep discounts which is also rare. They are giving upgrades because they are avail at the hotels. Brazilians are not coming due to the unrest and economic issues there. This Rio spotlight for olympics is not good for them.

 

[beachlover4444]

Others may disagree but my take on it:
It is a combination of those factors, spring attendance was already down slightly (intl tourists down). Orlando tourism in general - after recovering from 2008 recession that hit 2009 attendance, w/ 2010-11 returning to avg (or above) attendance, and 2012-15 booming w/ both NFL and UO Harry Potter opening.

It's very unlikely that Disney will freeze or roll back current prices (barring a catastrophic economic meltdown). They will offer discounts (eg on room and dining) to draw tourists.

Re: pricing. I suspect that the avg FL tourist (age 35-54+ w/ an avg household income of $100,000+) who has visited in recent years is now snubbing their nose at the product being offered (or otherwise not finding value in it, and waiting for more additions), especially in light of recent events which are only exacerbating the issue.
[Edit: I believe that Millennial families want to go to WDW, but only the affluent ones (~15-20%) can afford it right now. It's definitely not akin to Walt's Disneyland anymore].

Alot of my Disney fanatic friends I know are doing beach vacations this year - cheaper to rent a house and split the costs and still have fun.

 

[beachlover4444]

That's true if all you are looking for is bigger, faster rides with at most minimal theme. If you want immersive thrills, Universal is the best place to find them.

Disney and Universal are at different side of the spectrum. I do agree Universal is a more 15-40 park without little kids. More thrill rides, newer, more exciting inventive stuff while Disney sticks with it's tried and true and to it's brand. It is going to need to add some faster attractions. I loved the new mine ride in fantasyland but it is a slow ride. And our 3 year old granddaughter couldnt ride it because of height. She would have loved it, it's geared toward little kids. It is not an e ticket thriller.

 

[beachlover4444]

I think that the difference is in scope. Casey Jr. area is a neat area and great for kids, and possibly adults, especially when it's hot which is about 9 months out of the year in Florida.

Other attractions mentioned are also nice and in that they "add a little something" to the park.

I think that the difference is that while you may have wonderful memories of Casey Jr. or someone may have wonderful memories of some other attraction or feature, it's not something people have a normal conversation about. It's not something that people talk about wanting to go see at WDW. People don't say, "Oh, did you hear? Casey Jr. is open and it looks like great fun to go and splash and play in the circus area!" It definitely can add something while you're there, though, and isn't a bad addition.

I remember when Space Mountain was being built and, as a kid, that's all we talked about. We couldn't wait to get to "Disney World", as it was called back then, to ride Space Mountain. There was buzz about it. BTMRR and Splash Mountain had the same buzz. I remember even Pirates having that buzz, to a lesser extent. Casey Jr. Splash Area, while neat, doesn't have that buzz. Even the NFL only had buzz in Disney fan-specific circles. 7DMT wasn't being talked about at the water cooler except by Disney fans.

Harry Potter has that buzz. Lots of people like Harry Potter and those people were, and are, excited to go to UOF to see Harry Potter Land.

I think SWL has some of that buzz in the Star Wars fan community but it doesn't seem, to me at least, and yes, this is subjective, to be at the same level as the Harry Potter stuff. TSL doesn't seem to have any buzz at all.

I hear more people talk about the Food & Wine festival at Epcot than talk about any other Disney offering, including the new stuff. While the other additions are nice, and do add to it, overall, there's no buzz or excitement.

Universal is just more geared toward the younger crowd who like thrills and excitement. Disney is lagging in excitement. It is focused on kids seeing characters and slower rides. Personally at 55 I love WDW and I'm getting too old to ride those coaster type rides so me and my grandkids are WDW focused but I do think Disney needs more rides like Everest to keep up with Universal