No Fifth Park at WDW?

[rodkenrich]

A recent article (http://www.orlandosentinel.com/orl-asecdisney01050105may01,1,3139764.story) has disclosed some information as to why Disney's Animal Kingdom may be the last park built on the property.

[loriandmatt]

i personally would have no problem with this, if (and that is a big if) they do what this article proposes and spend their funds on the existing parks and resorts.

- lori

[ahhhhhhhhhhhhhhhh!]

Yeah, I have this awesome idea for a 5th park in my head and I wish there was a way to pitch it to Disney, but alas....there isn't. So in my head it will stay :cool1:

[BostonRob]

The link isn't working because of bandwidth issues. Would you mind cutting and pasting and posting the article?

[pixiedust23]

i coudlnt get the article to work either! but i would very much like to read it!

[rodkenrich]

The link isn't working because of bandwidth issues. Would you mind cutting and pasting and posting the article?
The bandwidth has been restored.

[rodkenrich]

i coudlnt get the article to work either! but i would very much like to read it!
Access to the page has been restored, but I am currently working on relocating the article.

[pixiedust23]

maybe there is something wrong with me. i still cant get it to work!

[rodkenrich]

maybe there is something wrong with me. i still cant get it to work!
The link has been modified because I have exceeded my bandwidth allowance. Access has been granted.

[civileng68]

I agree with the article (just worked fine for me).

I dont want a 5th park. I think it's about time to start taking that money they would put in a new park and make the current parks more stunning. Think of what that money could do in the existing parks!

Also, as the article says, if they built a fifth park and tourism fell, Disney may not be able to afford to keep all of the parks in a bad economy.

I think it's time to work on what they've got and not worry about another park for at least 15 years.

[Greg K.]

...that at a certain point, the law of diminishing returns sets in. As things stand now, a family can enjoy a four or five day vacation (or, perhaps, longer) and see and do most of what they want in that time. Adding another park complicates matters immeasurably, and would arguably make a Disney vacation both more expensive and time-consuming.

I know a lot of families who budget (both in time and money) for JUST ONE TRIP -- and once they've "done Disney," that's it (unless they really get bitten by the bug and start looking for ways to go back every year...!)

And then there's this: the last big park they opened in the US -- Disney's California Adventure -- was a major disappointment, and not drawing the crowds the company expected.

Personally, the REAL drawback to another park is that it would eat up more land, and likely cause more traffic -- and there's too much already! :sad2:

[Harmony]

Couldn't read the article. (link didn't work) However, I too, agree that what Disney has right now is enough. It's hard as it is, trying to do and see everything in a week. Can you imagine if they added another park? The money is best spent adding to the parks by bringing in bigger and better rides and shows. JMO :)

[BostonRob]

Here it is:



Walt Disney World is at a crossroads.

Faced with an aging U.S. population, more sophisticated children and increasing competition for leisure dollars, the crown jewel of Disney's worldwide theme-park empire has set out on a new path.

The Walt Disney Co.'s once-successful growth strategy -- build, and they will come -- is no longer the road map for the future.

As the entertainment giant this week celebrates the 50th anniversary of Disneyland, the company is closing a chapter on its U.S. building boom.

Squeezed by rising costs and Wall Street pressures, the Burbank, Calif.-based business is looking for different, more economical ways to grow and focusing on overseas locations for its next parks.

The change means Animal Kingdom, which Disney opened in 1998, may be the last major park built by the company in Central Florida. There are no current plans to add another.

Instead, Disney is looking to take advantage of the more than $12 billion in capital that it has already plowed into former Florida swampland.

Disney's goal: Make more money through additional time-shares, targeted marketing campaigns, investments in the four existing parks and programs to entice tourists to stay longer and spend more. It's a plan that plays well among analysts, who say it makes business sense to reinvest in established parks rather than build anew.

"I think the premise is truly we are going to grow," said Al Weiss, Disney World president. "It's going to look very different. It's not going to be a big blip up when you build a theme park. It's going to be growth that is going to continue over a long period of time."

In Central Florida, a region long accustomed to park openings and robust tourism growth, the impact from Disney's strategy is hard to predict. But as other sectors play a larger role in the regional economy, the result may be greater diversification in the region, a goal of many area leaders.

Consider:

As Disney pursues its next phase of development, the rate of growth in the region's tourism sector could slow to a more steady pace. While visitation is at record levels -- nearly 51 million tourists are expected to come to Central Florida this year, a 5.9 percent increase from last year -- the pace is not as brisk as it sometimes was in the past decade, when increases hovered around 10 percent.

Central Florida will feel the effects of Disney's growth strategies. Though Disney World is still the area's largest employer with 57,000 employees, its share of the metro Orlando work force has mostly been dropping since 1998, when Animal Kingdom opened. And Disney's roster of about 38,000 full-timers today is less than the 40,000 or more it had during the late 1990s. As tourism jobs grow at a slower rate, the region's economic makeup could change, which some see as positive.

Rajeev Dhawan, an economist with Georgia State University, said Central Florida could benefit from an easing of tourism's growth rate.

"It's a blessing in disguise," said Dhawan, whose forecasting center studies economies throughout the nation. "There is short-term pain if you look for other industries to grow, but it pays off in the long run. The hoteliers may not like that and others [in the hospitality industry] may not like that. But it is true. "

Business strategy

Decades of experience as the nation's leading theme-park operator may no longer be enough to ensure a successful future for Disney as the landscape shifts. The industry has matured in the past 50 years and the challenges are greater:

Disney has to be more creative to draw increasing numbers of visitors. Its core audience -- young children -- is shrinking as a share of the overall population. The percentage of U.S. children younger than 14 has decreased from about 28 percent in 1970 -- just a year before the Magic Kingdom opened -- to about 20 percent today. As a result, Disney has already taken steps to appeal to adults in its parks and through other activities, such as spas and golf. Aside from the demographic challenge, increasingly sophisticated children aren't as easily entertained as before, putting pressure on Disney to make a theme-park vacation ever more exciting.

Disney's theme parks and resorts worldwide brought in more than $7.7 billion last year. But as good as it sounds -- with Disney World tickets at a high of $59.75 and a record number of hotel rooms for more than $100 a night -- it's getting harder to make a profit. Costs are up, competition for leisure dollars is intensifying and consumers are opting for bargain vacations. Yet Disney -- with its stock price closing at $26.40 Friday, off about 12 percent from the year's high -- is under increasing pressure from Wall Street and investors to boost profits.

Tourism still dominates Central Florida's economy -- industry estimates put it as high as 40 percent of the area's gross regional product -- and Disney remains the strongest player. But there are signs of a shift.

Like Disney, Universal Orlando executives say they have no current plans to add another major park to their two-park complex. SeaWorld would not comment.

Visitation to Central Florida is at record levels, but the pace of growth has cooled somewhat since the 1990s. Attendance at Disney World is up, according to industry estimates, but it's still short of the peak of 2000.

"I don't think we're going to see that kind of unbelievable growth that we saw in the 1990s," said Bill Peeper, president of the Orlando/Orange County Convention & Visitors Bureau. "That's not sustainable for any product. We were seeing double-digit growth. . . . It's unreasonable to think that could continue."

During the next six years, the state's employment agency estimates the largest percentage of new jobs created in the region will be in the health-care and computer fields. Among the top 15 categories, only one tourism-related job makes the cut -- hotel and resort desk clerks.

In raw numbers, tourism occupations continue to create more jobs. But even in raw numbers, other occupations are making up ground, closing the gap and in some cases projected to exceed tourism.

Weiss, who chairs the Metro Orlando Economic Development Commission, sees opportunity for both tourism and other industries to grow robustly.

"You have to go down parallel paths. . . . You have to go down both paths as hard and heavy as we can," said Weiss, who is the second Disney executive to chair the commission. Former Disney executive Dick Nunis was chairman in 1992 and '93.

Orange County Mayor Rich Crotty says the appointment of Weiss as chairman of the not-for-profit public-private organization that promotes industries in Central Florida "shouldn't be lost on anybody."

"That's a signal we're pulling together as a community," he said.

Disney last year released an economic-impact study that showed the company accounts for more than 8 percent of the area's gross regional product, based on 2003 numbers. The study, for which Disney paid Orlando economist Hank Fishkind $25,000, used a multiplier that added in the economic effect of companies doing business with Disney, and companies that benefit from Disney's presence. When that factor is stripped out, Disney accounts for about 5 percent of the region's economy.

Local economists say they cannot independently verify Fishkind's estimates, but they don't discount them.

How the numbers compare with those of previous years cannot be determined. Fishkind and Disney declined to make his earlier impact studies available to the Sentinel, contending that they were not comparable. But Fishkind said that he is certain that Disney's impact, or size relative to the rest of the local economy, peaked some years ago, possibly in the mid- to late 1990s.

A revenue giant

Although Disney does not break out financial performance for Disney World, the Sentinel analyzed the company's public financial documents, tax figures and analysts' reports to estimate the Orlando property's revenue.

The overall Disney company's theme-park and resort division brought in more than $7.7 billion last year, and Disney World's parks and hotels easily account for 60 percent or more of the division's revenue, a Sentinel analysis shows.

With more than $4 billion a year in revenue, the Orlando operation alone would equal a Fortune 500 company based on 2003 revenue, bigger than Orlando-based Hughes Supply Inc. and about the size of Starbucks Corp. that year.

Wall Street analysts have long said that Disney World represents a majority of the division's revenue, and an even higher share of the profit.

But the Sentinel's analysis relied on tax receipts to get a more definitive total for sales and cross-checked it with everything from the company's payroll and benefits to gate-admission estimates and hotel revenue based on tourist taxes. The analysis shows that Disney World likely sends more than $700 million a year to the Burbank headquarters in operating profit.

Some or all of the numbers were reviewed independently by former Disney executives, certified public accounts who specialize in corporate reporting, county tax auditors, university professors and Wall Street analysts who follow Disney.

Although the parks in Orlando have long been a cash cow for the company -- $4 billion would represent 13 percent of the total company's revenue in fiscal 2004 -- the division's operating profit margin has been flat or falling for years. That means costs have been rising faster than the revenue coming in from park admission, hotels and other sources.

Operating profit margin -- or pre-tax profit divided by revenue -- is one key measure of how efficiently dollars are converted to profit.

While the picture has brightened in recent months, the division's pre-tax profit in fiscal 2004 was the second lowest for the U.S. parks since 1996.

Disney executives say business will grow -- indeed it must to meet the company's financial goals. But the type of growth, they concede, will be different.

"I think there's a big misnomer about, well, if you don't add a park or you don't add attractions you're not going to grow," Weiss said. Local officials have a stake in Disney's success.

"We need to continue to capitalize on the growth," Crotty said. "All of these things [Disney is doing] are moving in the right direction, and we need to remain the No. 1 tourist destination. Not building another theme park doesn't change that."

Celebrating past, future

Like the Disney Co.'s other parks and its cruise line, the Orlando properties will take part this week in the launch of Disney's 50th-anniversary celebration of Disneyland, the company's founding park.

The 18-month celebration will be as much a nod to the company's future as it will be a showcase of the California park's past.

Hong Kong Disneyland, for instance, will open its gates in September -- a sign of the company's emerging strategy to tap into the growth of Asia and its large child populations.

At Disney World, Animal Kingdom will add a completely new thrill ride next year, Expedition Everest, which will whisk riders through the harrowing snow-capped peaks of Mount Everest.

However, far more typical of the company's plan is what is happening at Epcot and Disney-MGM Studios. Each of those parks is getting a new attraction, but the simulator ride and high-speed stunt show are imports from other Disney parks.

By recycling existing rides or tweaking time-tested concepts, the company saves big bucks on everything from research and development to construction.

"I think it's a strategy that can work," said Jack Samuels, a professor at Montclair State University in New Jersey, who writes extensively on the amusement and theme-park industry, including Disney.

"If you can continue milking your cow and not have to invest more in grass and milk pumps, you're going to make more money."

Disney slashed capital spending for the theme-park division by half in 2002 and cut it again in 2003. While the number has rebounded slightly, top Disney executives vow to limit spending below the lofty $1 billion level that the division enjoyed in earlier years.

But some analysts have quietly questioned how much more Disney's theme-park division can contribute in cost cutting and profit growth. The U.S. economy is now in its fourth year of recovery from the relatively shallow 2001 recession, and any slowing could weaken consumer confidence and stall the tourism rebound.

With high fixed costs, analysts say, the theme-park division is more susceptible to profit pressures than the movie studios, TV networks and other Disney units when the economy falters.

Disney is also vulnerable to factors ranging from the cost of travel to hurricanes and the fear of another terrorist attack.

That's why Wall Street analysts through the years have been happy to see the overall company diversify -- reducing its reliance on the theme-park division -- to buffer against cyclical downturns.

Analyst Paul Kim of New York-based Traditional Asiel Securities gives credit to the company and outgoing Chief Executive Michael Eisner for "doing a good job cutting costs and increasing profits over the past 18 months" -- a period that saw the company fight off a takeover bid from cable giant Comcast Corp.

But Kim said that newly appointed CEO Robert Iger faces a challenge "to continue that momentum."

'Nontraditional' approach

At Disney World, Weiss won't reveal what Disney has planned for its 47-square-mile compound. But he says the company's future success will rely, in part, on "nontraditional growth vehicles," such as new marketing strategies and programs to get people to stay longer, spend more and keep coming back.

Disney also is banking on more visitors from abroad, but that's far from certain. International tourists, particularly those from Europe and Latin America, still haven't rebounded to their plentiful numbers before the 2001 terrorist attacks.

"It's still a weak area at Walt Disney World," said Dennis McAlpine, an independent analyst who follows Disney. "A lot of it is just out of their control, beyond what they can do."

Right now, Disney is having more success in targeting group travelers. Launched more than a year ago in response to the trend of multi-household travel, Magical Gatherings offers perks such as fireworks cruises, special dinners and other park activities exclusively for groups of more than eight.

The promotion has attracted extended families, reunions and other groups who need large, connecting rooms. Disney says it has reaped a 25 percent increase in household travel through Magical Gatherings.

Beyond targeted marketing, Disney is looking to its other businesses to drive more visitors to the parks. As out-of-town sports teams and school groups use the fields and facilities at Disney's Wide World of Sports, the company is trying to persuade them to spend time in the parks and stay in Disney hotels.

Children remain a core audience for Disney, but capturing their attention is increasingly difficult. Youngsters are maturing faster and their entertainment options dwarf those of earlier generations.

A key goal to Disney's long-term growth is encouraging visitors to keep coming back. By expanding its time-share business, the company aims to lock people in to years of Disney vacations.

In December, it changed its pricing structure to attract more people and prompt guests to extend visits.

Disney executives acknowledge that for some people, its theme parks had become an unaffordable vacation. The one-day admission price in Orlando has risen twice as fast as the average price of goods and services -- 106 percent -- from $29 in 1989 to $59.75 today.

The new plan, which encourages longer stays by making them comparatively cheaper, is the most sweeping change to Disney's pricing structure.

Disney's Weiss says the company is relying on its creativity and marketing prowess to drive its growth.

"I think that is something we've not lost focus on or lost sight of," he said, "because we know it's not only important for Walt Disney World and the Walt Disney Company, it's important for the Central Florida community to have tourism be as robust as it can."

Jerry W. Jackson can be reached at jwjackson@orlandosentinel.com or 407-420-5721; Debbie Salamone can be reached at 407-420-5456 or dsalamone@orlandosentinel.com; Sean Mussenden can be reached at smussenden@orlandosentinel.com

[DanceRC28]

I agree with a lot of what has been said. The 4 parks that Disney has are wonderful and instead of adding a fifth, they should revamp some of the older attractions. We all love Disney, we wouldn't be on this board otherwise, but even something as wonderful as Disney could be even more wonderful with some updates. :goodvibes

Renee

[cheerdancer11]

I think there is plenty of room for new rides in existing parks so they should just do that instead, and revamp some older ones. Especially in AK there is so much room it has a lot of potential with Expedition Everest coming in it will definitely draw more crowds.

[Lillian513]

i think they should update tommorowland to match today's tech. and what we might have in the future. they should also consider redoing older rides and put new ones and a new park. it would boost the number of people who come, and also promoteknow i would want to go to see new things. or they could update little souveniors.

[minniemouse101]

I also would like them to concentrate on the parks they have. It is better to have 4 great parks then to have 5 ok ones. ::MickeyMo

[reedycreek]

wow this is such great news! now they can finally focus on what they have now and improve and build on it. i think AK was not great anyway, i would have rather they spent that money improving the current infrastructure and imagineering.

[DISNEY4FUN]

I agree that a fifth park isn't needed at the moment. It's impossible to see it all now. I always thought that AK wasn't finished yet. I assume there is a lot of work still to be done in AK.

[DISUNC]

Thanks for that info rodkenrich!

On another thread on this board (cant find it right now), someone said that they had a discussion with a Imagineer. The Imagineer said the same thing, just added that WDW will expand on its Hotels & DVC!

So Maybe the POP Century will FINALLY be finished?????

[HesATramp]

Exactly what I was thinking! We were @ the POP in April (First time staying on-site), and looking over to the unfinished side was kind of depressing! LOL! Although....I wonder what Icons could be used for 50 years that included 2 wars and a depression! LOL!


Until next time,
John

[cmm]

When we were at WDW two weeks ago one of the bus drivers said they were planning on 2 new parks and 10 new resorts by 2010. Maybe he was including the new park opening in Hong Kong, although he kept talking about how much property they own there in Orlando. Then I saw that article in the Orlando Sentinel. I too would like to see them add some new rides in the existing parks.

1972 - Disneyland
Sept 1992 - CBR
June 2005 - POFQ

[DISUNC]

Exactly what I was thinking! We were @ the POP in April (First time staying on-site), and looking over to the unfinished side was kind of depressing! LOL! Although....I wonder what Icons could be used for 50 years that included 2 wars and a depression! LOL!
Until next time,
John

John,

LOL! but the 50's, 60's and so on...had some wars too (disney does look the other way on that).
Just recently on these boards, someone posted at Dis artist conception of what the 30's would look like....it was BIG Monopoly boards..etc.

Hey sounds like a new thread in the making...."when the POP Century decides to finish the early years...what should the icons be????? Whadda ya think? :cool1:

[TimothyG]

The article makes a good point but so much of Disney's strategy is something by surprise. Disney knows exactly what it needs to do and right now, Disney is not short of money or crowds. In fact, this will probably turn out the be the best profiting year since the new millenium, probably the last decade. In any case, Disney is still the number 1 vacation destination in America.

[lovewdwdvc]

Maybe we are different than many Disney repeat visitors but it seems that , although we ablsolutly love the theme parks, we are looking at the resort end of the vacation more closely. What I mean by that is that we want the nice restaurants and clubs(great food, nice drink good music etc), we want to spend more time doing resort activities (swimming, boating ,fishing, biking, etc,) and spend more time relaxing. Therefore, adding a new twist and cleaning up the 4 theme parks is just fine with us. So the vacation is much different than 20 years. What do any of you think?

[DVCconvert]

Trying to get guests to stay longer and spend more?

Hence:
the DVC discount on Annual passes,
the opening up of Disney Dining to out of state AP holders,
the Best Rate program for AP holders
the expanding windows for special events
the MYW ticket options

coincidence or calculated strategies ?
temporary juicing for the 50th, or part of a longer term plan designed to increase lenght of stays while spending more over their stay?

[wdwgoofeeee]

I read recently that the reason Pop has not been completed is that it is very difficult to hire employees with the unemployment rate so low in central Florida.
That could be another reason Disney will not be building another theme park in the near future (besides the massive cost).
I agree with everyone else that they should concentrate on improving the current parks and updating areas like Tomorrowland in the MK.
They also need to add more sit down restaurants in and outside the parks.

[Jon99]

I like the idea of not building a 5th park, instead building a 3rd water park and a few "minor" attractions...

[disneyworldgirl]

Personally, as much as I'd like to see another park area added, I think it's more important for Disney to concentrate on improving the current parks (hiring back CM's that were laid off awhile back, performing whatever maintenance work that may be needed, adding a few more attractions to existing parks, etc.). After these things have been done, then maybe they can start thinking about adding a new park.

[mo3]

What they should do is figure out a way to manage the crowds--they might not be able to do what universal does with front of the line access, but they should offer some sort of perk to guests staying onsite. Of course, I don't have any solutions!

[raidermatt]

A lot of things to discuss with this...

First, its curious that, according to the article, visitation to the area is at record levels, yet WDW's attendance is not. Meaning that tourism is most definitely no longer the issue, its rather the competition is taking business away from Disney.

Now, Disney would have us believe that this proves that building a new park will not generate proportionate growth. After all, they built AK but have lost market share and failed to reach attendance levels of only a few years ago.

But how can we be sure that its really just a case of the market dictating that 4 parks is enough? What if Disney had built MGM to the same scope as MK/Epcot? What if they had done the same with AK? Forget whether we like what is there, I'm just talking about the scope of the park. The size, the number of things to do, etc. Certainly they had the capital to do so, as they invested billions in other business areas, some with "sub-par" results.

One of two things would have occurred. The company would have you believe that they would have been simply throwing away more money. But the other possibility is that greater growth would have been attained. And if that had been the case, a 5th park would not be such a ridiculous proposition right now.

Its a hypothetical that is impossible to answer definitively, of course. But I truly believe that sticking with the original, proven philosophy of raising the bar, and trying to exceed guest expectations would have yielded better returns than building parks sized to meet a specific marketing goal.

But, since we are where we are, I agree that the current parks should be the focus. Partly because MGM and AK were opened with far less than they ever should have been opened with. Partly because Epcot has been allowed to stagnate far more than it every should have. And partly because current management obviously does not see the true fault with the "build a park to add a day" philosophy.


On the "growth through marketing strategies", I don't have a problem with that per say. However, it has to be remembered that the bottom line is people come for the product, and changing pricing strategies does not change the product. So sure, its fine to re-price things and make offers to get people to stay longer, but that has to happen along with keeping the demand up for the product itself. And that can only happen through capital investment.

Is $1 billion enough to actually maintain that demand? Is it realistic to "limit spending below the lofty $1 billion level that the division enjoyed in earlier years", when there are more parks and resorts on which to spend, and as those parks and resorts age?

I seriously doubt it.


Regarding the parks cyclical nature due to economic and tourism downturns, coupled with high fixed costs, I agree with that. Its true that the movie and tv divisions are not impacted as much by these. However, its also true that the parks benefit from upturns more than these other divisions. The parks are also not as susceptible to the wild year to year swings that the tv and especially film divisions can experience.

Again, something to keep in mind when considering current investment. Cut it too short and it can take years of spending to catch up.

[mickey2000]

NO new Park NO new ship I guess what they say is true "THERE IS LIFE AFTER DISNEY" . I still go to Disney, but not like I use to, there are just to many other things to do and life is short! As the above poster said the parks are aging. Also thier two cruise ships are getting worn and old. They need to build a new ship soon as it takes an average of 3 years before it can sail. I still have a weak spot for the parks that will always be there :earsboy:

[LIPurple]

I was just in Disney in July and on one of my many bus rides to and from the parks the bus driver was talking about the size of Disney with another bus passenger who was astounded at the sheer size of the land that Disney owns and he was telling her that there were plans for a fifth park in the making but after 9/11 the park was put on hold. He didnt say anything about the theme for the park or if it would ever be built, but there definitely were plans for one. I dont know how true this is because as with anything Disney if you ask 12 CMs the same question you get 12 different answers. Just try asking the boat captains at POR what is being done, if anything, with the TreeHouse Villas. They each have a different theory, answer, rumor, etc.

[rocketriter]

One thing you can assume is that ALL plans are being rethought now that Disney is Under New Management. My guess is that, with MGM and Animal Kingdom unfinished and the international area of Epcot stagnating, management will see more value in improving those areas than in opening up yet another half-day park.

[bicker]

The reality is that they have far more information about us than we have about them. There is a lot of logic in four parks being enough -- heck, I'd have guessed that three parks were enough. Beyond a certain point (i.e., the amount of time people have available for vacations, based on what their jobs and personal situations would permit), more attractions won't make most people stay longer. Also, there is no question that there will be a point of diminishing returns beyond which more attractions won't increase attendance enough to make it the most profitable use of capital. If the issue was capacity, the best use of resources would be to increase the capacity of existing attractions, not build new ones.

So, the only question is what is that certain point, and again, they know more about us than we know about them.

I have full confidence that Disney under Bob Iger will continue the responsible management practices of Disney under Michael Eisner, and not fall victim to any "more is always better" philosophy.

[rodkenrich]

One thing you can assume is that ALL plans are being rethought now that Disney is Under New Management. My guess is that, with MGM and Animal Kingdom unfinished and the international area of Epcot stagnating, management will see more value in improving those areas than in opening up yet another half-day park.I concur with the fact that Disney is now under new management and certain projects that were put on hold need to be reinstated and/or projects that were "scrapped" need to be reconsidered and put those projects back on the drawing board. Wouldn't be interesting if Disney actually created surveys for the general public or at least Annual Passholders via online or postage mail to get different views and pespectives on all of the projects that Disney has post-Eisner?

[rodkenrich]

What they should do is figure out a way to manage the crowds--they might not be able to do what universal does with front of the line access, but they should offer some sort of perk to guests staying onsite. Of course, I don't have any solutions!In regards to the "Front of the line" access that Universal Studios offer, Disney is considering a similar idea in conjunction with the current Fastpass system with a few twists. Read more here (http://www.jimhillmedia.com/article.php?id=1449).....

[bicker]

Wouldn't be interesting if Disney actually created surveys for the general public or at least Annual Passholders via online or postage mail to get different views and pespectives on all of the projects that Disney has post-Eisner?I've been solicited for feedback about recent WDW trips twice in the last few years. I have no reason to believe that Iger will stop such surveying.

[rodkenrich]

I agree that a fifth park isn't needed at the moment. It's impossible to see it all now. I always thought that AK wasn't finished yet. I assume there is a lot of work still to be done in AK.Even though Animal Kingdom isn't completed, the plumbing issue (http://www.jimhillmedia.com/mb/articles/showarticle.php?ID=1289) that the park now faces will really put future plans on hold.

[rodkenrich]

I read recently that the reason Pop has not been completed is that it is very difficult to hire employees with the unemployment rate so low in central Florida.
That could be another reason Disney will not be building another theme park in the near future (besides the massive cost).
I agree with everyone else that they should concentrate on improving the current parks and updating areas like Tomorrowland in the MK.
They also need to add more sit down restaurants in and outside the parks.There is a possibility since Disney is outsourcing overnight cleaning jobs (http://www.hotel-online.com/News/2005_Sep_08/k.OSD.1126283544.html) for the resorts, that outsourcing, when employess are hard to locate, could solve Disney's issues in terms of finding more employees to fill vacancies.

[NeverEnufWDW]

Sure.....get me to stay longer by adding more DVC and not opening any new attractions other than re-treads from other parks ?

Each park at WDW needs some major upgrade and refurbishment.

If they don't plan on building innovative, NEW attractions at the parks how on earth will they latch onto those pre-teens and teens that the article specifically mentions ?

:confused3

[bicker]

I believe there was specific mention in one of the forward-looking statements that indicated that there would be new attractions replacing old attractions, as well as other enhancements to the parks. The only thing that is almost surely not going to happen in the foreseeable future is the creation of a new GATE -- a new park.

[MiknMinMouse]

I just don't want to see them keep adding hotel rooms to the property. They already have more than enough rooms on site. The parks, IMHO, can't handle the load that more rooms would bring. It would be nice to see them add new attractions of some sort and spruce up what's already there. :rolleyes1

[bicker]

For now, the only rooms they seem to be adding are DVC rooms, which are still selling like hotcakes.

[peter11435]

I just don't want to see them keep adding hotel rooms to the property. They already have more than enough rooms on site. The parks, IMHO, can't handle the load that more rooms would bring. It would be nice to see them add new attractions of some sort and spruce up what's already there. :rolleyes1

Adding more hotel rooms will not increase the number of guests in the parks. The parks are no more busy in 2005 than they were in 1975 when there were only three on site resorts.

[Lewisc]

New attractions are need to help encourage repeat business. Four parks, 2 water parks, DTD, mini-golf, WWoS and resort activiies is probably enough to ensure they typical vacation guest (7-10 days?) has enough to do without leaving WDW. A fifth gate doesn't much sense.

[kab407]

While on the KTTK tour last week, I asked the guide (Rae) this same question. Her take was that Disney does have the land to build another park. Right now, they only occupy one-third of the total land it holds in Orlando. (The other two thirds are open for building and are set aside as wetlands and for conservation.) Her guess was that no announcements would be made till late 2006, after the 50th anniv. in DL was done. Interesting that she was able to give a timeframe. We shall see.

[bicker]

It is always easy to give a timeframe which is sufficiently far in the future such that the prognosticator is unlikely to be called-on their forecast.

[All Aboard]

Her guess was that no announcements would be made till late 2006 Applying logic to this statement, she isn't estimating that any announcement will be made at or after late 2006, only that none will be made between now and then. That's really going out on a limb.

[raidermatt]

Four parks, 2 water parks, DTD, mini-golf, WWoS and resort activiies is probably enough to ensure they typical vacation guest (7-10 days?) has enough to do without leaving WDW. A fifth gate doesn't much sense.

One at least has to wonder though... Does it appear WDW has experienced diminishing returns with the 4th gate because its maxing out what people are willing to do, or is it possibly because the 4th gate lacked sufficient appeal and/or scope?

I don't expect anyone to provide a definitive answer to that, because there is nobody who can possibly have a definitive answer to that.

I just have to think that if the 3rd and 4th gates had been built with greater scope and possibly even greater innovation, that the results might have been different. I feel like Disney played the part of the pitcher who got beat with his 2nd or 3rd best pitch, instead of putting his best out there and seeing what happens. (I know that's not a perfect analogy, so no need to point out the flaws... just trying to make my point understood).

[All Aboard]

Raidermatt, I'd say it's some combination. And, it drives what I fear about a fifth gate. Looking at the attendance numbers for each of the four parks, they get smaller as you chronologically work through the list. So, suffice it to say that Disney would expect even smaller numbers for the next park. And, as such, they would allocate just enough capital to generate an acceptable ROI. I doubt anyone could present a plan that showed a 8-9 million incremental guest park and have anyone believe it.

Now, what would a park that is expected to attract just 5-6 million guests look like?

[cseca]

Adding more hotel rooms will not increase the number of guests in the parks. The parks are no more busy in 2005 than they were in 1975 when there were only three on site resorts.

Hmm... Is this done by percentage?
Just curious, how did you figure this out?
How many parks were there in 1975? How many resorts?

I tend to agree with the previous poster that more rooms will probably get more people and those people most likely will go to the park.
Without adding more areas in the resorts (theme parks, water parks, etc) where are those people going to go?

Don't get me wrong, I'm glad that disney is busy and still in business. But it would be a turn off for me if I have to stand in line for hours even during moderate peak season.

I think it's a good thing that they're concentrating with what parks they have, but if they keep increasing the amt of rooms without more space for people to go... I wonder what's going to happen.

[peter11435]

Hmm... Is this done by percentage?
Just curious, how did you figure this out?
How many parks were there in 1975? How many resorts?

I tend to agree with the previous poster that more rooms will probably get more people and those people most likely will go to the park.
Without adding more areas in the resorts (theme parks, water parks, etc) where are those people going to go?

Don't get me wrong, I'm glad that disney is busy and still in business. But it would be a turn off for me if I have to stand in line for hours even during moderate peak season.

I think it's a good thing that they're concentrating with what parks they have, but if they keep increasing the amt of rooms without more space for people to go... I wonder what's going to happen.
The more rooms disney adds the more small hotels around the orlando area and 192 close. The fact is that attendance at WDW has not increased as a result of more hotel rooms.

[DancingBear]

I tend to agree with the previous poster that more rooms will probably get more people and those people most likely will go to the park.
Without adding more areas in the resorts (theme parks, water parks, etc) where are those people going to go?

Adding more attractions and areas within the existing parks also spreads crowds.

[bicker]

Spreading-out crowds only increases cost without increasing revenue.

[cristen]

Spreading-out crowds only increases cost without increasing revenue.


Thank God Walt thought so too. I mean a park with 12 rides is fine. Who would want a park with more stuff to do? Those pesky attractions, and new lands like NOS, what a waste. Bottom line really is ONLY how much money can they make. I agree Biker, you are absolutely right.

:badpc: :sad: ( I need this last one for my avatar.)

[MiknMinMouse]

Adding more hotel rooms will not increase the number of guests in the parks. The parks are no more busy in 2005 than they were in 1975 when there were only three on site resorts.

We must be going to different Disneyworlds then. It seems like each year we go the crowds are larger and larger, and each year more rooms have opened on site. I'd like to see them stop adding rooms, even DVC rooms. Focus on improvement and even if not adding another park adding some other something. I wish River Country would come back :-)

[bicker]

Walt is dead. If Walt ran the parks in the 1990s and 2000s the way he ran the park in the 1950s and 1960s, the company would have been bankrupt very quickly.

Keeping things real is very critical for a constructive discussion of things like park expansion and new parks. Nice chatting with y'all. :wave2:

[peter11435]

We must be going to different Disneyworlds then. It seems like each year we go the crowds are larger and larger, and each year more rooms have opened on site. I'd like to see them stop adding rooms, even DVC rooms. Focus on improvement and even if not adding another park adding some other something. I wish River Country would come back :-)
It may seem like, but if you look at the numbers that is not the case. The attendance at MK, Epcot, and the DS are all lower now than they were 10 years ago.

[seashoreCM]

Disney-MGM Studios was built with a specific purpose, to capture guests from Universal Studios.

Animal Kingdom was built with a specific purpose, to capture guests from Busch Gardens. I disagree with the idea that AK is a half day park. It takes me all day when I go to see what the park is all about -- animals.

I suppose a fifth park could also be built with a specific purpose, to capture guests from Universal Studios ('s Islands of Adventure) but Disney already tried that in the form of its California Adventure park next to Disneyland and that idea flopped.

I also suppose that there could be another specific purpose, to occupy the land freed up when Disney replaces the MK parking lot with a parking garage.

What have guests been saying about what they would like to see in a fifth park?

[peter11435]

Disney-MGM Studios was built with a specific purpose, to capture guests from Universal Studios.

Animal Kingdom was built with a specific purpose, to capture guests from Busch Gardens. I disagree with the idea that AK is a half day park. It takes me all day when I go to see what the park is all about -- animals.

I suppose a fifth park could also be built with a specific purpose, to capture guests from Universal Studios ('s Islands of Adventure) but Disney already tried that in the form of its California Adventure park next to Disneyland and that idea flopped.

I also suppose that there could be another specific purpose, to occupy the land freed up when Disney replaces the MK parking lot with a parking garage.

What have guests been saying about what they would like to see in a fifth park?
They have enough free land to build three more parks in WDW (among other things) without having to occupy the site of the MK parking lot. Additionaly I highly doubt they have any plan to replace the lot with a garage anytime soon.

[All Aboard]

If Walt ran the parks in the 1990s and 2000s the way he ran the park in the 1950s and 1960s, the company would have been bankrupt very quickly. You say that with such authority and conviction. Yet, so often I read posts from you telling us that we don't know much about running businesses. I'm guessing in your line of work, you are charged with making high level business decisions? Is that correct?

[bicker]

Yes. I was an international management consultant, providing consultancy on operations management to many Fortune 50 companies. I helped many of these companies navigate the very treacherous waters converting from the bogus "Quality is Free" perspective of the 1980s to the responsible management perspectives of the 1990s. Of course, Disney was already well on its way by the mid-1980s, since they were almost bankrupt by 1984 due to the negligent management of Roy Disney's successors, when Eisner was brought in to lead the company to responsible management.

[All Aboard]

So, your job was to show companies how their management philosophy was improper? Why then do you so often make statements that amount to "the management of the company knows what they are doing and will guide the company in the right direction"?

[bicker]

Because they have great professionals like me helping them! :)

[Another Voice]

Of course, Disney was already well on its way by the mid-1980s, since they were almost bankrupt by 1984 due to the negligent management of Roy Disney's successors, when Eisner was brought in to lead the company to responsible management.
Of course, as a business analyst one would hope you had the facts correct.

In fact, Walt Disney Productions was no where near bankruptcy. The company had been run since the time of Roy O's death by a small group of his (not Walt's) advisors. Card Walker and such were running the company as if it was still 1965, too timid and to business like to change anything. They were the exact sharp pencil, operational business people that Walt knew would never be able to run a creative enterprise.

The primary issue was that Disney was not performing up to the level that most people thought it could. While profitable, other studios had become rich from Disney-like films such as Star Wars, Raiders of the Lost Ark, E.T. and such. No one could understand why it wasn't Disney that was making these films.

This sparked an internal power struggle between the "Walt side" of the company (lead by Ron Miller) and the Roy side of the family (lead by Roy E. Disney). Corporate power struggles always attract the interest of bottomfeeders; several Wall Street "investment" types began buying large blocks of shares. The idea was that a) someone could run Disney better than a squabbling family and b) the company's stock price made the parts of the company worth more than the corporation as a whole.

Walt Disney Productions succeeded in buying the shares back from one of these investors (a practice called greenmail), but other, smaller sharks had been attracted. By this time the "Walt side" of the family had managed to push the old management out of the way and had begun to make some immediate changes.

It had been long, long known that the best way to turn around a movie studio was to make movies that made money. They created Touchstone Pictures, their first big hit being Splash. They had also just opened EPCOT Center at Walt Disney World and began an effort to expand on the success of that park. They also launched The Disney Channel to bring Disney productions back into the home and to expand into the brand new area of cable television. And of course, they partnered with the Oriental Land Company to build Tokyo Disneyland which continues to be Disney's most profitable and successful park.

Of course, many in business don't want to wait. But mostly they want to loose. While the "Walt side" was doing all of this, Roy E. was on the sidelines. Nor did he want to work with the management of the company. So, he threw his lot in with one of the "investors" that was trying to destroy Disney. Furthermore he brought in another set of "investors" who bought even more shares.

Disney wasn't saved - it was taken over by the Bass Brothers.

Since Roy E. detested the "Walt side" management, he fired them all. The Bass Brothers and others brought in a new management team to run their purchase. Frank Wells was brought in the run the company, Michael Eisner was hired just to give the studio an edge into the Hollywood power structure (Eisner had just been fired as head of Paramount Studios). Of course, no one at the time realized what Eisner was really like – he was just kept around because he had a good rolodex to the Betty Ford Clinic.

But that's another story.

[Bstanley]

I'm making some popcorn. This promises to be more entertaining than anything that's been in the theatres this year...





PS. Good to see you Voice...we'll talk about AKL another time :-)

[flbelle82]

when Eisner was brought in to lead the company to responsible management.


Obviously you don't understand the magic and vision behind Disney and Walt's dream if you think Eisner knew anything about responsible management. I think responsible management would include remembering and honoring the vision that a company was founded on, not just turning it into a money hungry machine.

[Planogirl]

I haven't really noticed that the resort as a whole is more crowded. MK is quite busy of course but only part of MGM was crowded the last few times we went and Epcot had tumbleweeds crossing it most of the day. I won't comment on crowds at AK since the pathways are so narrow so it's always felt crowded.

Maybe more people will stay onsite and not visit the parks as much? That's what we've been doing but I don't know if we're unusual.

[crusader]

The primary issue was that Disney was not performing up to the level that most people thought it could. While profitable, other studios had become rich from Disney-like films such as Star Wars, Raiders of the Lost Ark, E.T. and such. No one could understand why it wasn't Disney that was making these films.

I fail to see how Star Wars would ever have been considered "disney-like" in the 70's. I can see how the success of that film, would send a major wake up call in Hollywood, and Disney would find themselves the weakest link in terms of competing on that level.

And while we're at it, what director from the Disney camp in the 60's-70's remotely resembled the professional, technical and visual genius the likes of Lucas and Speilberg to warrant anyone within the Disney company to believe these types of films should have come from a source heavily invested and concentrated in animation and low-budget family films?

Where within the Disney vault lies the action/adventure library of films (and I heavily emphasize the plural on this) demonstrating record breaking results and highly coveted accolade to give anyone within Disney's employ a lack of understanding as to the why it wasn't Disney pioneering this?

Hollywood has often confused the fact that it takes more than the idea and the ability to succeed. There's a whole other side to the brain that needs to be involved here.

[Werner Weiss]

Of course, as a business analyst one would hope you had the facts correct.
Another Voice,

It's great to see a post from you again! Your summary of the situation with Disney in the mid-1980s is excellent.

[raidermatt]

Nice to see one from you too, Mr. Weiss!

Yes. I was an international management consultant...

Ah, consultants... Now THERE'S an interesting discussion!

And while we're at it, what director from the Disney camp in the 60's-70's remotely resembled the professional, technical and visual genius the likes of Lucas and Speilberg to warrant anyone within the Disney company to believe these types of films should have come from a source heavily invested and concentrated in animation and low-budget family films?


I'm no expert on the matter, but I'm guessing there wasn't one... but wasn't that part of the problem? That Disney not only wasn't moving in this direction, but wasn't even prepared to do so?