Cuts coming to every area of parks and resorts - thanks to Shanghai and Paris

[RSoxNo1]

Time for my two cents:

1. "Buh, buh, Disney is shortchanging the US parks! It's not fair!" - Yes, but remember, attendance in US parks is at record highs. Unless people ACTUALLY stop going to the parks, Disney can do whatever they want; it's a morbidly obese Cash Cow for them.
2. Disney may need to make a decision in the future about divesting some of its international parks, but that remains to be seen.
3. Most of the time, we only know what the Disney company intends to reveal to the public. There is always more to these stories than meets the eye, and while speculation is enjoyable, I like my information to be solid before I jump on a bandwagon.

1. How much do you keep milking the cow before you feed it?
2. How about stop expanding international and focus on the domestic parks that are funding the international parks.
3. This site is more informed than the vast majority of the company. Given the discussion points we're having right now, this site was vehemently against My Magic+ and partially against Shanghai. There are enough intelligent people on these boards that if they were place inside an executive board room could have told the executives that these last two major decisions were poor ones. I'm not going to pretend I have the business experience as Bob Iger, but that doesn't make him a good CEO. He has made good decisions and he has made poor decisions. Most of his poor decisions involve the theme parks where I feel a number of people on this site could have and did make better suggestions.

 

[The90skid]

1. How much do you keep milking the cow before you feed it?
2. How about stop expanding international and focus on the domestic parks that are funding the international parks.
3. This site is more informed than the vast majority of the company. Given the discussion points we're having right now, this site was vehemently against My Magic+ and partially against Shanghai. There are enough intelligent people on these boards that if they were place inside an executive board room could have told the executives that these last two major decisions were poor ones. I'm not going to pretend I have the business experience as Bob Iger, but that doesn't make him a good CEO. He has made good decisions and he has made poor decisions. Most of his poor decisions involve the theme parks where I feel a number of people on this site could have and did make better suggestions.

Fair points! I did not intend to draw counter arguments with my post, but I see where you are coming from.

1. I think my original post answers that; there is no need to feed the cow when people are still coming to the US parks in droves. When attendance and revenues start dropping, then we will see changes (hopefully).
2. This is honestly up for debate, so I can't say that your opinion is right or wrong.
3. I agree, many people on the boards are very informed, but I think it is still a stretch to think that all of us are expert executive consultants (I certainly am neither informed or an expert lol). Whether or not Shanghai and MM+ are complete failures also remains to be seen.

 

[MississippiBelle]

I normally try to have a pretty positive outlook towards Disney and the decisions being made to keep it up and running. There is a lot to still look forward to and be positive about, which I think everyone here agrees on. The cuts, if they turn out to be is extensive and obvious as everyone speculates, cross a line for me. The domestic parks have gained a loyal group of followers and continue to draw in new guests who could eventually join the first group. To cut back on customer service, food stuffs, maintenance, etc. in the domestic parks to fund other projects is a snub to the guests. The longer the Disney company takes their domestic guests for granted, the less likely it will be that the new guests become loyal returning guests. My family fell into the returning guest category for years, but recently we've started taking part of our trip to go to Universal Studios or have chosen to vacation elsewhere entirely. Perhaps it won't be as drastic as it seems and we won't notice a difference during out upcoming trip. I still love Disney, but it sure does smart to feel like the red-headed step child.

 

[marni1971]

You were asking for infrastructure improvements that were brought in as part of the overall My Magic+ project that weren't there before.

That being the case it is even more absurd that back of house upgrades - which are obviously needed - should cause park funding to be cut. More so with record profit. Not naming you specifically please understand, just using your post to quote.

They still didn't find their 11% MM induced increase in spending did they?

 

[ford91exploder]

In Eisner's last ten years (95-05) he built Indiana Jones Adventure (that's a bit of a stretch), Animal Kingdom, DCA, Rock 'n' roller Coaster and approved Expedition Everest and Soarin' in WDW. In Iger's first ten years he fixed DCA, and built Toy Story and New Fantasyland. I'm giving the nod to Eisner's worst 10 years.

Universal is copying it without doing any of the R&D. I'd be surprised if Universal's system costs 5% of what Disney paid.

Universal is probably just going to buy a 'off the shelf' RFID ticket system, They DO exist.

 

[Jon81uk]

That being the case it is even more absurd that back of house upgrades - which are obviously needed - should cause park funding to be cut. More so with record profit. Not naming you specifically please understand, just using your post to quote.

They still didn't find their 11% MM induced increase in spending did they?

One way I have sort of thought about is there was very little investment in rides/attractions over the last few years, but they did some park changes such as the hub and of course implemented MyMagic+. Now we are getting the park investment showing with RoL, Avatar, Toy Story, Star Wars etc.

Of course it could be that as MM+ went so far over budget that is one reason they are cutting the CM hours now. But I suspect the Shanghai overspend is more closely linked.

 

[ford91exploder]

I'm well aware of what cuts have taken place. And I'm not happy about them. But you have zero knowledge about most of the things you post. Your uninformed hyperbole and misinformation stated as facts is unnecessary. I feel sorry for people who read your posts and think you have a clue what you're talking about. You are not nearly as knowledgeable as you think you are.

No, I'm not an 'insider' I'm a guy who goes into failing situations to fix what's wrong so I've seen this scenario more times than I want or care to remember, I could probably write a letter which exactly mirrors your corporate communications. You are probably seeing stuff like "Due to the challenging international situation we regret that re-alignments in our stateside operations are necessary to ensure the long term health of the blah, blah, blah. Our organization will be stronger as the result of these organizational re-alignments sincerely Blah"

You seem to care about what you are doing and your customers, My advice to you is GET OUT while the getting is good and go to work for an organization which invests in its people as you seem to be an intelligent person who CARES about what they do. Find an organization which appreciates those qualities and you will go far.

 

[RSoxNo1]

Universal is probably just going to buy a 'off the shelf' RFID ticket system, They DO exist.

They can just buy the infrastructure used in Jurassic World. I hear that park is liquidating it's assets.

 

[ford91exploder]

They can just buy the infrastructure used in Jurassic World. I hear that park is liquidating it's assets.

- well played

 

[raven]

OK. I've been thinking more and more about this whole "Shanghai Is Over Budget And They Need More Money" thing.

Has anyone confirmed this? I mean other than internet stories? Is that the real reason for all the cuts? Or are they using that as a cover for something else to just make cuts in general and overcharge guests even more? Do we take what was reported on the internet as the truth?

This thing is getting bigger and bigger and it almost seems like it's effecting employees lives now. I'd really like to see something on a national news level at this point because it's starting to look fishy.

 

[Goofyernmost]

You were asking for infrastructure improvements that were brought in as part of the overall My Magic+ project that weren't there before. A complete network installation, not just wifi but all the ethernet needed to run it and all the touchpoints and kiosks is a pretty big infrastructure investment.
Also more than 28,000 hotel doors needed their locks replaced in order to connect wirelessly with the MagicBand. Two dozen workers spent eight months upgrading 120 doors per day.
Now you could argue that the magnetic stripe tech was OK, but many hotels are upgrading to RFID locks, so this is a good long-term investment as well.

If a new park was built now they would have a decent network cabling system in place from day one and new hotels would have RFID locks, not keys or mag stripe. Much of the cost was upgrading exisiting stuff.

Also think about the ride hardware that was installed, such as the screens at the end of Small World that were designed to say goodbye to your name or in your language but have never been used.

I'm not saying the project hasn't gone over budget, just that there is more to it than FPs and MagicBands

Don't waste your time. This is a tunnel vision topic. No one seems able to see the bigger picture and instead focus on the small portions or put on their "tin hats" and imagine some sort of armageddon that would happen if MM+ were to be used at it's original level.

That being the case it is even more absurd that back of house upgrades - which are obviously needed - should cause park funding to be cut. More so with record profit. Not naming you specifically please understand, just using your post to quote.

They still didn't find their 11% MM induced increase in spending did they?

I still have to wonder how we know that. Why can it not be possible the the record profits and record attendance have not been influenced by MM+. How do we know how close to the 11% they have come with no other real explanation about the cause of those increases. No real added attractions, nothing of huge significance to bring people in, the only change being MM+! How does that mean it hasn't worked at least to the people that decided to go with it to begin with. There is a big difference between what is made the scapegoat for cuts and what may actually be the reason.

I'm not saying you're wrong, I'm just asking for some proof that it is the big waste of money and failure that it has been made out to be other then some suspected things that didn't come about... yet!

 

[doctornick]

That being the case it is even more absurd that back of house upgrades - which are obviously needed - should cause park funding to be cut. More so with record profit. Not naming you specifically please understand, just using your post to quote.

This. IMHO too many people focus on the rumored costs versus "benefits" of all the MM+ spending. Then this leads to inevitable debates over how necessary the changes were and whatever.

That to me is all besides the point. Disney can and should spend money to upgrade their infrastructure and bring new technological features to the parks; such investments are going to be costly given the size of their resorts. But that stuff, no matter how expensive, should be completely separate from any park development/renovation funding. Whether they spend $1B or $3B or whatever on MM+ should not have been a reason to not develop new attractions or fix old ones or the like. As @ParentsOf4 will happily point out, the amount of investment in P&R was at historically low levels for the past decade even accounting the money going to MM+ (and building cruise ships, etc.). With the parks making profit head over foot, there was plenty of money available for MM+ and to also be upgrading the physical structures of the parks at the same time.

 

[peter11435]

No, I'm not an 'insider' I'm a guy who goes into failing situations to fix what's wrong so I've seen this scenario more times than I want or care to remember, I could probably write a letter which exactly mirrors your corporate communications. You are probably seeing stuff like "Due to the challenging international situation we regret that re-alignments in our stateside operations are necessary to ensure the long term health of the blah, blah, blah. Our organization will be stronger as the result of these organizational re-alignments sincerely Blah"

You seem to care about what you are doing and your customers, My advice to you is GET OUT while the getting is good and go to work for an organization which invests in its people as you seem to be an intelligent person who CARES about what they do. Find an organization which appreciates those qualities and you will go far.

I'm not involved in the organization. So I don't have to get out of anything since I'm not in it. That said even if I was I would never take your advice for anything and I would sincerely hope nobody else ever takes your advice either. You should never trust a person who thinks they are an expert on every subject.

 

[ford91exploder]

OK. I've been thinking more and more about this whole "Shanghai Is Over Budget And They Need More Money" thing.

Has anyone confirmed this? I mean other than internet stories? Is that the real reason for all the cuts? Or are they using that as a cover for something else to just make cuts in general and overcharge guests even more? Do we take what was reported on the internet as the truth?

This thing is getting bigger and bigger and it almost seems like it's effecting employees lives now. I'd really like to see something on a national news level at this point because it's starting to look fishy.

The 'real' insiders seem to all agree that SDL is in deep kimchi, I don't think this will hit the national news until easter or so when large crowds descend on WDW with it's reductions fully applied.

 

[raven]

The 'real' insiders seem to all agree that SDL is in deep kimchi, I don't think this will hit the national news until easter or so when large crowds descend on WDW with it's reductions fully applied.

WDW is the largest employer in Florida and the largest single-site employer in the US. So something this large scale is certainly news worthy and we haven't seen that yet. That makes me think something else it up.

 

[ford91exploder]

WDW is the largest employer in Florida and the largest single-site employer in the US. So something this large scale is certainly news worthy and we haven't seen that yet. That makes me think something else it up.

Remember TWDC is part of the 'Media Industrial Complex' because it owns ABC.

I think until NBC or Fox wants do a 'investigative report' on the problems at TWDC it's not going to happen, Right now there is no reason to but post Easter or this summer and probably summer because political news will be slow there will be lots of negative airtime on 'How Disney stole our money and ruined our vacation...' and that with the IT layoffs becoming an election issue negative ink is gonna flow by the barrel not to mention all those electrons being seriously inconvenienced.

 

[raven]

I think until NBC or Fox wants do a 'investigative report' on the problems at TWDC it's not going to happen.

Maybe they are unaware of it too. I'm really quite surprised Unions haven't spoken up and made it 10 O'clock news worthy yet.

 

[ford91exploder]

Maybe they are unaware of it too. I'm really quite surprised Unions haven't spoken up and made it 10 O'clock news worthy yet.

Nah remember that it's Political Silly season and that's a moneymaker for the networks, I expect this will probably break in the summer before the conventions and then the fun will begin.

 

[tribbleorlfl]

I tend to agree with the reports that the Shanghai money pit is responsible for these cuts over the hypothesis this a fall out from the MM+ money pit. Why?

While it's widely accepted MM+ went over schedule and over budget, and we've yet to see many of the micro transaction experiences implemented, the system has been in place 3 years now and is as stable as any large technical infrastructure system can be. If we were to see any dramatic increases and cost cutting from the extended testing and development of MM+ missing its 2012 delivery date, we would have already seen them. Certainly capital improvements were minimal during this time, and there have been cutbacks and price increases, but nothing this draconian.

Shanghai, on the other hand, is costing at least 4 or 5x what MM+did. Coupled with an additional year of construction costs and 1 Whole year without revenue they probably had budgeted for, well, this seems to be the most likely and logical culprit.

 

[Brad Bishop]

Will the cuts be retracted once Shangai opens?

That's a bit like asking, "Will they finish the Tomorrowland make overs once DLP is up and running?"
... 25 years later and the answer is still, "No."