"Disney - Magic Restored" The Economist April 19th 2008

[Missing20K]

So I picked up The Economist before a recent flight as usual (a fantastic publication, highly recommended) and without realizing it there was an article on Disney. Naturally, I saved it for last, and thought I would just relay a few items I thought were interesting, and my opinion of them. Not that anyone cares, but what the hey.

First, they spoke with Iger, and similar to his recent interview, they seem to be all about HSM and Hannah Montana and the like. Apparently, us park-goers have to realize that just a little more than 25% of Disney's revenue comes from the park, it seems they have a TV station, radio, music labels.....who knew?? :ROFLOL::ROFLOL:But seriously, there is quite a bit of talk on synergy again, and integrating what Iger called "franchises" into all aspects of Disney both at the parks and in their media. Not sure how I feel about it personally, as I'm not a tween, but it does seem to drive business. Does not seem to bode well for those fans who are not fans of the newer characters gaining a larger presence in the parks. But when you make over 100 million in operating profit from HSM and it's spinoffs alone, it's hard to argue with them wanting to increase their exposure even further. :hammer:

On the franchise note, under Iger Disney now apparently has ten "franchises" but they don't mention all of them. From what I can tell from the article, these seem to be, (in no particular order) Hannah Montana, HSM, Cars, Mickey Mouse, Disney Fairies, the rest seem to be up for debate (perfect for these boards :lol Personally, I could do without the tween stuff, but I understand it from a business view. I just don't ever want to walk on a Hannah Montana ride or attraction, I think I'll puke. :hurl: Oh another opinion on the Hannah Montana in regards to someone's post about the American Idol attraction......I'm sure they could re-theme it in a few years to HSM or Hannah Montana, if they think it's getting stale. Cripes, can you imagine the lines at a "Be Hannah Montana!!" or "Auditions for High School Musical TODAY!!" attraction???? :brick:

But just a few final points on the article, you guys can read it for yourselves in interested (sorry don't have a link to it) They don't seem to be concerned much at all about the recession. They feel they are much more resistant to one than its rivals. And I'm not sure if this was posted somewhere else, but they have plans for ten animated films in the next 4 years, which I can only think means we will probably see many more characters or "franchises" in the parks in the coming decade.

One final point, the tone of the article seems to be one of "Thank God, Iger came and saved us" I don't know how true or untrue this may be from an outsiders perspective, but the article is most certainly pro-Iger.

I'm becoming verklempt. Talk amongst yourselves. I'll give you a topic. The Jungle Cruise is neither a jungle or a cruise. Discuss.

EDIT: sorry for the length....kinda rambled there

 

[wolf359]

Thanks for the review!

First off, I can see why many people would be a fan of Iger's; the amount of positive change the Walt Disney Company has seen since he took over has been great. There have been strong improvements in the theme parks and in the quality of the animated films. Now sure, not every project has met with 100% success but they sure have been TRYING a lot harder lately, as compared to how things were ten years ago.

Overall, I'm probably not too worried about the attempts to bring more of the currently popular properties into the theme parks. Walt never missed a chance to cross-promote what was popular when he was around, so I can't protest too loudly for Disney to continue that trend now. Even though many of these properties aren't interesting to me, they obviously are to a lot of other people.

I think WDC has an almost impossible task of trying to strike a balance between being respectful to the past, taking advantage of the present, while still looking toward the future, and I think what they're doing now is leaps and bounds beyond where they were ten years ago.

 

[Skyway]

Untl now, I never really stopped to think about how Disney has become more "franchise-driven".

Some complain that's a bad thing, such as there being too much HSM and the Pixar-ization of the parks. A few long for the Disney of the late 80's/early 90's.

But I think the company is so much better and stronger nowadays. The recent renaming of MGM Studios is a visible reminder of how weak Disney properties were in the "good ol days". Disney's film library in the mid-80's was so small and stale, Disney had to partner with an outside company to make their new theme park relevant. That's certainly not the case anymore. (Yes, you could argue that the Lucas and American Idol additions contradict that idea, but those are just a small part of the current Disney experience)

People complain that the parks are now too "character-driven", and they think attractions should be more "original" like they used to be.

But keep in mind that its only been in the past decade- in large part to Pixar and the franchises- that Disney finally has good characters to put in attractions. Ten years ago, Disney had only four major relevant properties-- Little Mermaid, Beauty and the Beast, Aladdin, and The Lion King.

Since then, Disney has added Toy Story, Monsters Inc, Nemo, Stitch, The Incredibles, Cars, HSM, Hannah Montana, and Pirates-- just to name a few of the MAJOR new properties--and all of which have been wildly popular with the ticket-and-toy-buying public.

I'm sure Michael Eisner---and even Walt himself-- would have LOVED to have such a strong (and widely diverse) character library when they were in charge of the company. Since they did not, they were forced to create what some would call "original" park attractions or partner up with outside properties.

And lest you think this is a new phenomenon, remember that Walt "stole" Tom Sawyer Island for Disneyland. He certainly exploited his one big franchise in the parks--"Davy Crockett". His popular films became theme park attractions. Some fit the theme of the land (such as Adventureland's Swiss Family Treehouse) but others did not (Tomorrowland's "20,000 Leagues" exhibit, which was actually set during the Civil War, not the future!)

Who's to say Walt would not have put cartoon aliens and monsters in Tomorrowland??? That wasn't an option for him BECAUSE HE DID NOT HAVE THOSE TYPES OF POPULAR CHARACTERS. Walt was a businessman, and Im sure if he had created Mike and Sully, he would have found a way to put them in Disneyland (and they wouldn't have gone in his medieval Fantasyland)

The franchise-driven Disney Company is much different than it was a few years ago, but I think its better for the consumer (and certainly better for the shareholder)

 

[bugsbunny]

Two of the first things Iger did when he was named the next CEO:

He extinguished Stategic Planning and fired everyone associated with it. That planning group was long the coffin for any decent project as long as Eisner was around and it basically stopped any and all creativity within the company.

Two....he got back the rights to Oswald the Lucky Rabbit!

He reversed the process where $$ was make a priority over Imgineering. And he bought back what was stolen from Walt 80 years ago. Obviously, this man is about Disney spririt and meaning, not your typical big wig CEO.

And now with the marriage to Pixar and the creative talent shuffle to fill the ranks, things are looking good all over.

 

[Missing20K]

I agree, the overall direction of the company, which the CEO is certainly in charge of, seems to be much better than it was under Eisner. Bob Iger does seem to be injecting a new burst of creativity and attempting to make Disney a more relevant brand, as opposed to a nostalgia brand.

My only real complaint, if you can call it that, is that I wish there was slightly more balance between nostalgia and innovation, as well as demographics, especially in terms of media, which in turn determines many happenings in the parks. What I mean is that, they seem to be pushing the tween franchises a bit more than the others, as well as relying on them more instead of innovating new ones. Although, I am a huge fan of the announced nature series.....I'm not very old(26) but I certainly remember watching the old nature series on the disney channel growing up, they were sweet.

I have to say, at first I was skeptical of Iger considering his ABC, ESPN roots....but with each announcement, he seems to really understand the Disney brand, and where it needs to go, at least from a business standpoint.

Now, I just pray he does the same with the parks, and realizes their importance in the empire. Some may agree with me and some may not, but I find it funny when I see the what needs refurbed posts, only because I feel all the parks are becoming slightly dated. :shrug: I feel all the parks could use a "once-over" if you will. I was there in January, after not being there for nearly a decade....and I couldn't help but think everything needed a coat of paint here, a cleaning there, a new speaker, a new light fixture....essentially what they have done with HM:sohappy:, and to a lesser extent POTC. These seem to be the little touches that Disney never seemed to miss in the past. I hope there are more announcements in the future from Iger and Co. relating to the parks and a healthy dose of money for both refurb and new development.

Does anyone know what the percentage of overall revenue the operating costs for the parks takes up?? And how it has changed/not changed over the years?? Or where I might find it?? :shrug:

 

[hpyhnt 1000]

WARNING! Long Post Ahead! :lol:

I agree, the overall direction of the company, which the CEO is certainly in charge of, seems to be much better than it was under Eisner. Bob Iger does seem to be injecting a new burst of creativity and attempting to make Disney a more relevant brand, as opposed to a nostalgia brand.

My only real complaint, if you can call it that, is that I wish there was slightly more balance between nostalgia and innovation, as well as demographics, especially in terms of media, which in turn determines many happenings in the parks. What I mean is that, they seem to be pushing the tween franchises a bit more than the others, as well as relying on them more instead of innovating new ones. Although, I am a huge fan of the announced nature series.....I'm not very old(26) but I certainly remember watching the old nature series on the disney channel growing up, they were sweet.

I have to say, at first I was skeptical of Iger considering his ABC, ESPN roots....but with each announcement, he seems to really understand the Disney brand, and where it needs to go, at least from a business standpoint.

Now, I just pray he does the same with the parks, and realizes their importance in the empire. Some may agree with me and some may not, but I find it funny when I see the what needs refurbed posts, only because I feel all the parks are becoming slightly dated. :shrug: I feel all the parks could use a "once-over" if you will. I was there in January, after not being there for nearly a decade....and I couldn't help but think everything needed a coat of paint here, a cleaning there, a new speaker, a new light fixture....essentially what they have done with HM:sohappy:, and to a lesser extent POTC. These seem to be the little touches that Disney never seemed to miss in the past. I hope there are more announcements in the future from Iger and Co. relating to the parks and a healthy dose of money for both refurb and new development.

Does anyone know what the percentage of overall revenue the operating costs for the parks takes up?? And how it has changed/not changed over the years?? Or where I might find it?? :shrug:

I could not agree with you more on that point. The parks, while representing only a quarter of the company's revenue, are one of the first things a person thinks of when they hear the name "Disney". They carry the Disney brand, and are therefore a reflection upon the company. Having parks with dirty walkways, broken lights, or peeling paint reflects poorly on Disney, and that memory will remain with people, particularly since they expect a higher standard from Disney. I'm not saying the parks are in terrible shape, but I agree with Missing that the parks could use a shot to the arm, if you will. Some may disagree, and I respect that, but I think all of us can agree that there are some small things that could be done in each park that would make for a much better overall experience.

I also agree with the sentiment that Disney is focusing too much on tweens and new character franchises. Now, I understand that Disney is meant to appeal to kids, and that when people come to WDW, they want to see characters, blah, blah, blah - I get it! However, a balance must be struck between character attractions and attractions that are NOT based on Disney characters. As Skyway stated, Disney was not blessed with a huge character base, so he was forced to dream up more original attractions. However, keep in mind that some of these attractions (ex: Haunted Mansion, Space Mountain, Jungle Cruise, Pirates of the Caribbean) were huge successes and are still popular to this day. Also, not all of these were geared to a specific audience; they were created because they were good ideas that fit in with the land they were built in.

Actually, I think that may be the biggest problem that some (myself included) have with character based rides; they do not always fit in with their surroundings. Stitch does not belong in Tomorrowland, and Monster Inc, along with Buzz Lightyear, while not as bad as Stitch, are also lengthy stretches in Tomorrowland. Furthermore, Donald Duck should not be leading us on a tour of Mexico, and Nemo, which had the makings of a great refurb, ended up turning The Living Seas into a Fantasyland attraction, something that Epcot was never supposed to have. Again, all this is my opinion, but I think the reason character based attractions now get such a bad rap is because their placement (more often than not it seems) is in areas where they don't fit in. Is it fair to generalize about all character based rides this way? No. Some of them are done right, but the trend in past years has not always been that way.

Anyway, enough on that. I don't want to turn this into the old "rides based on characters are bad" debate again (though I'm afraid I already have!).

Getting back to the article, I do believe Disney is on the right track once again. The acquisition Pixar was a no brainer, and should help Disney with its animation studios division, and I do like the steps taken to diversify the company's interests. Is Iger the savior of the company? Time will tell, but he seems to be leading Disney in the right direction, and I am among those excited (perhaps somewhat cautiously) about the direction the Walt Disney Company is taking.

 

[gettingsmaller]

The acquisition of Pixar will not only help the animation department. I think that John Lasseter and Steve Jobs (as well as others) will have influence across the spectrum at Disney. To me, that bodes well for Disney. As a former PIXR shareholder, I really felt that Pixar had a lot going for it and was not entirely happy with the acquisition agreement, but as a Disney fan, I think it was a brilliant move to bring those creative talents into the Disney fold.

This is another thing that Iger did that Eisner could not or would not do.

 

[unkadug]

Found the link if anyone wants to read it:
http://www.economist.com/business/displaystory.cfm?story_id=11058438&CFID=3211147&CFTOKEN=35493741

 

[RandySavage]

I fall into the camp that cringes whenever currently popular movie characters are shoe-horned into the parks and disrupt the underlying theme (as Joe Rohde defined it in his AK powerpoint presentation).

I hope Iger remembers that Disney's biggest franchise only exists because 50 years ago a few imaginative people cooked up an original boat adventure featuring pirates.

 

[wedway71]

Whats the most amazing is the fact that Iger is CEO and President.

With the exception of the times from Frank Wells death to Mike Ovitz and then Mike Ovitz to iger there had always since 84 been 2 seperate roles.

I am not a betting man but I think Tom Staggs will be the next President.

 

[wolf359]

As for balance between old and new, I think Disney has managed to strike a balance pretty well. Some of the biggest projects in the parks in the last few years have been to take care of the classic attractions. Just look at the attention put to Small World, Haunted Mansion, Pirates, Spaceship Earth, and Space Mountain and the Submarine Voyage at DL. And it seems like Jungle Cruise, and Imagination, and Star Tours, and perhaps Universe of Energy are next.

So it seems like they ARE trying to give TLC to the classics, one by one, and sure, add new things based on what's popular today. And still make room for great attractions based on original, non-franchise concepts. I would be even more disappointed with Disney if the only bold new plan they had was to go completely "retro museum" with the theme parks and ignore what is popular and relevant to children today.

As for the condition of the parks, I think that overall things are on a big upswing. Sure there are a lot of little things that could still be done to improve the flaws, but at the same time I’ve seen a big improvement in the last few years. I recall a trip in 1999 where the Magic Kingdom looked absolutely horrible. Huge chunks of paint missing seemingly everywhere, everything seemed dirty, lots of special effects in attractions not working, on and on. But there are a lot of different factors at play here. There is management’s attitude towards the maintenance budget, for sure, but there is also the fact that 50,000+ people walk through each park on a daily basis. There’s bound to be days where things are worse than others.

Were things always better “back in the day?” Did Disney really have a flawless track record on attractions and maintenance at one point in time? If so, what was that point? If July 17, 1955 happened yesterday there would be hundreds, if not thousands of people blowing up this forum on just how badly Disney had missed the mark. Were people upset back in 1955 that all of FantasyLand was one big commercial for Disney’s films, FrontierLand and AdventureLand devoted to promoting currently popular Disney TV shows, and Tomorrowland devoid of futuristic attractions and filled with crass, out-of-place advertising displays from Disneyland’s corporate sponsors?

The only thing different was there wasn’t an internet back then. Now, we’re so used to the constant up-to-the-second flow of information from the Disney parks that every scrap of trash, every flake of paint, and every Chicken Nugget gains an inflated sense of importance. What’s missing is any kind of follow-up post showing that the trash was picked up, where that spot was repainted, where that nugget was only a temporary thing (I can hope, anyway) but you’ll never see it because the Doomsayers have already moved on to the next “Disney Crisis,” because those threads attract more rubberneckers.

Sorry for the long post, but sometimes I just get frustrated that even when Disney does make improvements they’re either dismissed or ignored. I think that overall Walt Disney World is better now than it has been in the last 14 years I’ve been going there, and there’s even more coming in the near future and I think that has a lot to do with Bob Iger. So I’m glad he’s getting some credit for it.

 

[TubaGeek]

Rule of thumb: You can't please all people all the time. No matter what Disney does they'll be flamed. Opposite that, they'll always have our support in the long run... right... right?
Of course I'm right.

 

[Missing20K]

As for the condition of the parks, I think that overall things are on a big upswing. Sure there are a lot of little things that could still be done to improve the flaws, but at the same time I’ve seen a big improvement in the last few years. I recall a trip in 1999 where the Magic Kingdom looked absolutely horrible. Huge chunks of paint missing seemingly everywhere, everything seemed dirty, lots of special effects in attractions not working, on and on. But there are a lot of different factors at play here. There is management’s attitude towards the maintenance budget, for sure, but there is also the fact that 50,000+ people walk through each park on a daily basis. There’s bound to be days where things are worse than others.

I certainly can't disagree, as until my Jan. '08 trip it had been '97 when I was there last, so I can only take your word for it that maintenance has been getting better in the last few years. And I realize that with the volume of people and attractions, sidewalks, buildings, etc. to maintain makes it difficult for everything to be perfect, but I can't help but wonder if the maintenance budget is what it should be. Everyone holds Disney to a higher standard, and it seemed to me this past trip as though the standard slipped a little....and I do mean a little. It is still the most beautiful, best maintained park I've ever visited. Sorry for the thread drift.....

 

[wolf359]

Well, I believe back in the mid '90 things were generally better than they ended up in the last years of Eisner's reign. I recall a trip in '96 where it seemed like everything at WDW was really at a high point in every way.

But the sudden drop of tourism and the general climate within the Disney company from 2001 to 2005 really dug a deep, deep hole in creativity and general maintainance in all of the parks, and I think in many ways they're still climbing out of that hole. There was a period around 2003 where on every trip things seemed a little worse each time.

So we took some time off from visiting WDW since 2004, and since that hiatus obviously there has been a big shake up throughout the entire company, and now I've been twice recently, in December of '07 and just last month and I've seen a marked improvement from where things were five years ago, but even I agree they probably aren't where they were in the mid-'90s. But I think by this "magic" 2011 date everyone keeps talking about they will be, and probably even better.

Which is awesome, because I'll always love Disney theme parks and I have some really great memories, but I want to be able to enjoy my new visits, not just live in the past reliving old ones.