Disney's Little Secret

FIRST Rumor Mill
1

Well, its not exactly a HUGE secret, 'cuz I know, but rumor has it that sometime tomrrow Disney is going to have some bad news for its shareholders.

“Our studio has added yet another quarter to a year of strong growth. At our parks, effective expense-management measures have largely compensated for the weaker attendance that we had anticipated.”
-Michael D. Eisner, Chairman and CEO of The Walt Disney
Company.

For the first time in 8 years, Disney is expected to report a loss in its quartly earnings. Of the areas most heavily hit, amusement parks will be near the top. Disney is taking a beating from the events of 9.11, because people don’t seem to want to go to a “center for American Culture, like Disney World” and would rather go someplace else. Interestingly enough, the 3rd quarter report states that they were taking a loss in amusement parks even then.

Disney Financial Report - 3rd Quarter, 2001 (through 6/30)

The new movie, Monsters Inc (which EVERY animator out there should be willing to kill to see) is expected to turn things around, but not fully.

What effect does this have on FIRST, you might ask, and why am I posting it here, rather than in the rumor mill? Well, let me explain some basic economics to some of you younger folks out there.

Disney is seeing a loss, and to componsate they need to get some more people into those parks. They generate a fair share of Disney’s revenue, and so they’re going to try to recover it. They are allegedly planning to instigate many “Get people here” policies, including but not limited to:

-Reduced Admission Prices
-Reduced Accomodation Costs
-Special Packages
-Reduced Airfare
-Discounts

I see some lightbulbs going on, but there’s still a few dim ones out there…

**This means you can most likely get to Nationals, and then stay longer and better for less money, if you purchase your accomodations in the next month. ** Wait at least a week, I’d say, because that way you won’t end up paying more than you have to, because the prices have not gone into effect.

If someone’s really gung-ho out there and wants to find out how much hotel prices are in disney right now, we can see if they drop as expected.

So, in summary, wait a week, then start looking at Nationals, because you may save yourself and your team a lot of money.

Have a good night y’all, and watch the news to see if they announce like they’re supposed to.

2

While much of what you’re saying is true, there are a lot of other, fundamental problems with the way the Walt Disney Company has been run in recent years that are finally showing up thanks to the recent downturn in tourism.

Tourism has been hurting all summer long, with many local parks seeing increased attendance as a result of families deciding to stay away from destination resorts such as Walt Disney World. This was happening before September 11, like you mentioned.

Disney’s theme parks are the cash-cow of the company. For the past several years, that have all but neglected this arm of the company, leaving things as they were. This created little incentive for families to return, as there weren’t any really new attractions to speak of. Couple this with the fact that Disney uses the revenue generated by it’s theme parks as a lifesaver for all of it’s other divisions that are not performing well (virtually all of them) and you’ve got a recipe for disaster.

But, big Mike E. is so hell-bent on making things like ABC, Fox Family, The Mighty Ducks and bad live-action movies stay afloat that he isn’t willing to sacrifice one of those divisions for the theme parks’ sake.

Before Disney ever really drastically cuts their prices, they’ll do anything else that they can to save money in the parks. This includes the dismissal of huge numbers of full and part time staff, the end of the Magic Mornings Early Entry program, delayed attraction and hotel openings (Pop Century), and closing the entire Port Orleans: French Quarter hotel. Only when that doesn’t work, will prices plummet.

If team advisors are really interested in booking outside of FIRST, try calling Disney’s Central Reservations Office every few days to see how things are going. It’ll take some poking and prodding on your part to get the cheapest rates, but there are deals to be had out there.

But, all in all, Torchin is pretty head-on about this. Now, and the coming months, are the time to book. Maybe, this’ll finally get Disney to start putting money into the parks again. It’s a bit pathetic that the next real attraction to open in the parks has been under construction since before 2001 Nats and will not open until after 2003 Nats.