News Reedy Creek Improvement District and the Central Florida Tourism Oversight District

[mikejs78]

I'm inclined to agree with you. Specifically, I'd say "buzz off" when the "stakeholders" are trying to goad you, as an executive of a publicly traded company, into making poor business decisions, as they did with Disney.

I don't think it's clear that this was a poor business decision.

 

[mikejs78]

yeah, even with the DOW down 4% for the year, Disney is off by nearly 30%. I think reality is sinking in on streaming services and the cows are headed home. Only consolation is they're not Netflix!
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This is off-topic, but I think that Disney's stock is suffering a bit from Netflix's woes. I actually think, out of all the players, Disney is probably positioned best for the long-term, both from a growth and profitability standpoint. The only other company that I see that has equally strong fundamentals is Warner Media.

 

[flynnibus]

I didn't say Disney. I was referring to publicly traded companies overall.

So you make an analogy that is meaningless to Disney's situation. Got it.

Arguing the stockholders individual whims should be taken over stakeholders is like saying 'let the mob run the company'. A horrible concept and one based only in ideology not reality.

99% of our stock market is people trading existing shares - they only drive valuations, not actual investments in the business. Companies benefit from those valuations because it becomes barter they can leverage... but let's drop the non-sense of stockholders being individual voices the company is beholden to.

Nearly 66% of all TWDC stock is held by institutions.. meaning funds managed by people purely interested in making money off owning the stock. They have no interests beyond making more money. Their only moral or social buy-in is to what they think it will mean to Wall St.

And anyone who has ever worked for someone who only thinks that way knows how miserable of an existence that is. And certainly not the kind of environment that is needed for creative content.

 

[Brian]

I don't think it's clear that this was a poor business decision.

Again, considering the reputational damage that Disney has suffered, as shown in several public opinion polls, I feel comfortable making the argument that it was a poor business decision. Reputation matters to companies, and I can tell you from experience that they have people working within the company whose sole focus is building and maintaining the brand/reputation.

Whether the reputational damage is significant enough or relevant enough to affect the "bottom line" is the only question that remains to be seen, and I think we'd know with reasonable certainty if it's going to affect it when we see the Q3 results. I wouldn't bet on it having an effect, though.

There's also the fact that their decision caused the governor of Florida to react in a way that has cost them the benefits that RICD provides. While it is unlikely that this story ends with RCID gone completely, or quite different from how it exists now, the loss of RCID, and the strained relations they now have with the state government, which is likely to remain in place after this year's election, also damages the company.

 

[Brian]

So you make an analogy that is meaningless to Disney's situation. Got it.

I don't think you're trying to make the argument that Disney doesn't utilize and benefit tremendously from capital it gains from it's stock offering, are you?

Arguing the stockholders individual whims should be taken over stakeholders is like saying 'let the mob run the company'. A horrible concept and one based only in ideology not reality.

In this case, it was the mob of stakeholders that ran the company, and prompted Chapek's reversal.

 

[JD80]

Couldn't Disney just build corporate housing faster and move in loyalists to counter that?

You just used the words "Disney" "build" and "faster" in the same sentence. You may be the first one to do so in a very long time.

 

[GoofGoof]

You said "Anyone who “hates“ Disney over this political stance enough to refuse to buy their products probably already hated them anyway". "I agree there is no way of telling for sure".

Glad you added the disclaimer - I have been 16 times and was a DVC owner, but will not be going anymore... And I loved Disney, wasn't a hater ever. Just totally turned off by anyone or any company that supports something that I totally disagree with. As you all keep saying, people need to vote with their wallet, and I have.

Good for you. I’m sure there will be others and I’m sure there would have been some who never went back if Disney remained silent. You have every right to patronize whatever business you want. I suppose we will see how the numbers look going forward in the next decade or so. My bet is that Disney will be fine.

The point I was making was on the nuance of Disney speaking out. Would you have cut ties just knowing they opposed these types of bills or only because they went a step further and spoke out strongly? If it’s the first one then you may find yourself boycotting many, many businesses. Comcast/Universal, Apple, Google, Verizon, AT&T, many large hotel chain operators, most of the major airlines, numerous retail stores and restaurant chains. This is just a sample of the companies who signed a petition opposing these types of bills. It will be difficult to travel at all and hard to even post on this forum without a phone, a cell carrier or an internet provider, There are some exceptions but taking this type of position is pretty main stream. Again, you are free to boycott all of them. It’s a free country.

 

[Brian]

How do you know that the reputational damage isn't due to the fact that Disney didn't speak up sooner? Or that a decent portion of it is?

I don't. But not speaking up sooner, or taking the "neutral" position originally, may also contribute to it being a bad business decision.

Regardless, short-term polls don't always (and frequently don't) translate to long-term brand damage. If these polls are the same or similar 6 months to a year from now, then we can talk. But just the fact that there's an immediate reaction (even though we don't know what that reaction is, exactly, we can only speculate) doesn't make it a bad business decision.

I disagree. Companies should never be ok with such dramatic hits to their reputation, short-lived or otherwise. In Disney's case, it's even worse considering how they were among the most beloved American brands for the better part of a century.

Well, then it isn't a bad business decision if that's the case, no?

It is bad business if it negatively affects their reputation.

The reason why I said I wouldn't count on it affecting their bottom line to any measurable amount, and which can be tied to this issue, is because most parents aren't willing to look their small kids in the eye and tell them that they're canceling their WDW vacation because of Disney's stances on LGBT issues. Same thing with D+ subscriptions, tickets to the latest Marvel movie, etc.

The reputation matters long-term, when parents of children who are not already being brought up on Disney stories and experiences begin to avoid introducing them to these things because they don't trust Disney. This is highly speculative, to be fair, but if we are to believe the polling, and, as you said, it holds up over time, I can see this becoming an issue.

Who could have predicted that? Seriously? A normal reaction might be for the Governor of FL to speak out, encourage boycotts, attack Disney publicly. It is completely abnormal to have a reaction like we had with RCID, and it should not be normalized in this country. It's authoritarian. In hindsight, this might be the only case that could be made so far that it was a bad business decision, but no one could have predicted this scenario we are in today.

It was an unprecedented response, to be sure. But, as the saying goes, "hindsight is 20:20." When evaluating if a decision was a bad one, you have to look back on what was decided originally and what the consequences were.

 

[GoofGoof]

I disagree. Companies should never be ok with such dramatic hits to their reputation, short-lived or otherwise. In Disney's case, it's even worse considering how they were among the most beloved American brands for the better part of a century.

Dramatic hit is an opinion not a fact. I also don’t think it’s a foregone conclusion that Disney will no longer be among the most beloved American brands because of this. I get that you feel that way, but it’s a big country and lots and lots or people don’t care one way or the other on this issue. Sometimes we get so caught up in assuming because we only have 2 political parties the country is split 50/50, but it’s really only the people who care deeply about politics who are split down the middle. The vast majority don’t care.

 

[LAKid53]

Considering that it's the shareholders who are the ones who fund much of a publicly traded company's operation, and accept the risk by investing their own money, I'd say that the demands of the "stakeholders" can buzz off.

If Disney had made the right choice to ignore the screeching of the "stakeholders" in this situation, they would have avoided this gigantic PR disaster, and RCID would not have been touched. Now, they have managed to alienate large swaths of the political spectrum, left and right, and it's not the "stakeholders" who might suffer, it's the shareholders.

Where do you think the retained earnings used to pay dividends to shareholders come from? Stakeholders.

 

[Sirwalterraleigh]

You just used the words "Disney" "build" and "faster" in the same sentence. You may be the first one to do so in a very long time.

No foul by Len…no mention of “park” or “attraction” in his statement

 

[LAKid53]

Exactly right, unless DVC members dont care about Disney’s views. Try finding a room , for even one night from September through December is virtually impossible. We tried to switch resorts for just 2 nights in a row anywhere during our 2 week stay and nada.
We know boycotts dont work for anything. Its been proven time and again. When people say your going to alienate half the customers, its not true. They may disagree with your stance but they sre going to Disney. Try telling your little ones your not going because you disagree with Disney’s position on something, see how that goes. The parks will continue to be packed and nothing short of 300 dollar a day tickets will stop that i dont think.

Part of that is the inventory backlog related to 2020.

Did DVC owners sell their contracts? Yes. But I'd guess that had more to do with their personal financial situation at the time, rather than unhappiness over Disney's position on a piece of legislation in the state.

 

[lazyboy97o]

The irony is it’s probably a little of both, Disney managed to upset the extremes on both sides by getting political, first by making a statement the extreme left thought didn’t go far enough and then by making a statement the extreme right thought went to far. It’s pretty hard to alienate both sides but somehow Chapek found a way.

Had they stayed out of it, like nearly every other company in America did, they probably wouldn’t have upset anyone.

They said something because people were getting upset that they weren’t saying something. They didn’t just say something out of the blue.

 

[LAKid53]

They said something because people were getting upset that they weren’t saying something. They didn’t just say something out of the blue.

Not only that, THEIR employees wanted to know Disney supported them.

 

[LAKid53]

The “did he ask shareholders” line is just as dumb for two msin reasons. 1) the majority are institutions anyway 2) You even point out the population is split… so consensus is not a practical objective.

Leadership means leading- not just parroting.

The shareholders can speak with their wallets or votes.

nurturing a generational business does not happen solely with the mantra of shareholder value. It needs creating something of its own values and meaning besides what goes out in the boxes or on the dividend check.

I doubt Chapek picked up the phone and called Vanguard, BlackRock, SSgA or State Farm. Those are the largest shareholders of Disney stock, with Vanguard being #1.

 

[LAKid53]

The “did he ask shareholders” line is just as dumb for two msin reasons. 1) the majority are institutions anyway 2) You even point out the population is split… so consensus is not a practical objective.

Leadership means leading- not just parroting.

The shareholders can speak with their wallets or votes.

nurturing a generational business does not happen solely with the mantra of shareholder value. It needs creating something of its own values and meaning besides what goes out in the boxes or on the dividend check.

Many of us who grew up with Disney, beginning with the opening of DLR in 1955 wish that corporations would pay less attention to what the boys on Wall Street deem important and consider what their customers (stakeholders) think.

 

[LAKid53]

The cost of hotels, gas, and flights, even from a close place like NC, has been a factor into why we're not going this summer as usual. It doesn't mean we aren't going to try and sneak down for a weekend this fall, though. But in the short term, a summer jaunt to FL is financially out of the question.

I think many people will reconsider their vacation plans...and not just a visit to Disney. Memorial Day weekend is the start of vacation season. Gas prices always rise as the summer driving season commences. Several cruise lines have announced they're considering some sort of fuel surcharge. Airlines will increases their prices due to high fuel costs.

 

[WEDYENSID]

Part of that is the inventory backlog related to 2020.

Did DVC owners sell their contracts? Yes. But I'd guess that had more to do with their personal financial situation at the time, rather than unhappiness over Disney's position on a piece of legislation in the state.

"Did DVC owners sell their contracts? Yes. But I'd guess that had more to do with their personal financial situation at the time, rather than unhappiness over Disney's position on a piece of legislation in the state."

You would be wrong in my case... Since I considered buying Golden Oak several years before I purchased DVC, it had NOTHING to do with money...

 

[LAKid53]

"Did DVC owners sell their contracts? Yes. But I'd guess that had more to do with their personal financial situation at the time, rather than unhappiness over Disney's position on a piece of legislation in the state."

You would be wrong in my case... Since I considered buying Golden Oak several years before I purchased DVC, it had NOTHING to do with money...

Not all DVC owners had the personal financial position to purchase a home in the $3M-$5M range.

Way too much to pay for a 4000 square foot zero lot line home.

 

[GoofGoof]

Your were correct "only because they went a step further and spoke out strongly?"

I know that most large companies, and especially tech companies are very liberal socially - I've just lived with it even though I don't agree with their positions.

That is why I asked the question, it’s interesting to hear how people think and why this instance is enough to sever ties with a company completely while so many others go unnoticed. I am of the opinion that some of the people outraged at Disney do not actually realize how common their position is.