China’s richest man just picked a fight with Disneyland

[Acedink]

Sorry if this is the wrong forum. Says Disney won't be profitable in China for 10-20 years?

http://www.msn.com/en-us/money/comp...a-fight-with-disneyland/ar-BBtpn1Y?li=BBnbfcL

 

[IrishNYC]

In other words, now that Disney has given Wanda a park right there in China to study up on to make knockoffs of, they're going to go forth and make knockoffs, just like they do of regular consumer products.

 

[Mikie]

In other words, now that Disney has given Wanda a park right there in China to study up on to make knockoffs of, they're going to go forth and make knockoffs, just like they do of regular consumer products.

Lol! Too true
However, his comment about not being able to fathom the prices Disney has spent to build is noteworthy. There is definitely a huge cultural barrier to doing business in many countries, including China, and it's very possible that as a local, Wanda will be able to make his knock-offs for far less. . . Will locals care? And what will that mean for Disney?

 

[T_O]

Very interesting.
Sounds like a lot of hot air from a man who feels professionally threatened. I very much doubt the truth of his statement about Disney Shanghai not being profitable for so many years.

I was shaking my head when I read the comment that he "could not comprehend" Disney's costs in comparison to his own project supposedly on the same scale. Says a lot about the quality and ethics of Mr. Wang's company.

 

[mom2rtk]

In other words, now that Disney has given Wanda a park right there in China to study up on to make knockoffs of, they're going to go forth and make knockoffs, just like they do of regular consumer products.

I'm shocked.

OK not.

 

[mom2rtk]

Very interesting.
Sounds like a lot of hot air from a man who feels professionally threatened. I very much doubt the truth of his statement about Disney Shanghai not being profitable for so many years.

I was shaking my head when I read the comment that he "could not comprehend" Disney's costs in comparison to his own project supposedly on the same scale. Says a lot about the quality and ethics of Mr. Wang's company.

Mr. Wang is probably just jealous he doesn't have WDW making such a large contribution to his projects.

 

[HopperFan]

Well I agree with Wang on one thing .... "Wang said in the CCTV interview. “They shouldn't have entered China."

Lose-Lose. Disney could build against the threats that they were going to build it with or without Disney. OR. Disney could refuse to build, they build and steal it all giving Disney nothing, there is no recourse.

I think he underestimates the power of the real thing in this instance. And don't think it will take that long to turn a profit IF Disney is smart and is careful with further building, keeping it in check with incoming cash so they don't dig the hole too deep. But I think it's very sad that a country is permitted by the rest of the world to steal their IP and technology on an ongoing basis. Stop selling to them and stop allowing them to purchase our companies.

 

[DisneyLovingPreacher]

Well I agree with Wang on one thing .... "Wang said in the CCTV interview. “They shouldn't have entered China."

Lose-Lose. Disney could build against the threats that they were going to build it with or without Disney. OR. Disney could refuse to build, they build and steal it all giving Disney nothing, there is no recourse.

I think he underestimates the power of the real thing in this instance. And don't think it will take that long to turn a profit IF Disney is smart and is careful with further building, keeping it in check with incoming cash so they don't dig the hole too deep. But I think it's very sad that a country is permitted by the rest of the world to steal their IP and technology on an ongoing basis. Stop selling to them and stop allowing them to purchase our companies.

This is so very true.

 

[Maineiak]

It's very much a defensive move on Disney's part. If you don't open your own operations over there, more often than not there will be clones and knock-offs that are more than happy to steal your IP.

Now that they're established, keeping on the good side of the Chinese government will help to fend off any undermining by others.

 

[IrishNYC]

Well I agree with Wang on one thing .... "Wang said in the CCTV interview. “They shouldn't have entered China."

Lose-Lose. Disney could build against the threats that they were going to build it with or without Disney. OR. Disney could refuse to build, they build and steal it all giving Disney nothing, there is no recourse.

I think he underestimates the power of the real thing in this instance. And don't think it will take that long to turn a profit IF Disney is smart and is careful with further building, keeping it in check with incoming cash so they don't dig the hole too deep. But I think it's very sad that a country is permitted by the rest of the world to steal their IP and technology on an ongoing basis. Stop selling to them and stop allowing them to purchase our companies.

I think Disney Shanghai will see a lot of non-Chinese visitors, but not many Chinese. Even though China claims to have a growing middle class, I don't buy that. How does a communist government allow for that?

As for recourse, I think it would be hard for Disney to fight. Any knockoffs would have Chinese law on their side. When knockoff products are found in the US, the items are confiscated, the seller is jailed for a night or two (at least here in NYC), but the next day someone else is out there with the same knockoffs, because it's tough to get to the source, and that source is usually China. If we can't stop them from bringing these items into our country, how is Disney to stop them from building on their own soil?

It's very much a defensive move on Disney's part. If you don't open your own operations over there, more often than not there will be clones and knock-offs that are more than happy to steal your IP.

Now that they're established, keeping on the good side of the Chinese government will help to fend off any undermining by others.

Chinese companies threatened to build their own version of Disney there, so Disney stepped in and built their own. Now no international travel is needed to copy it. I'm sure the building plans are all on file, so all Wanda has to do is take a look and duplicate it.

 

[Paula Sedley-Burke]

If I really thought what he said ... I would sit back and stroke my pet lap cat and give an evil laugh and stay mute. Wait for the venture to fail. The fact that it has been said is More like to me a Likkle bit of jealously and somebody is scared of a Likkle mouse in their house...

 

[Candycane83]

I think it may still work eventually if it were just a question of knock offs... All the brand names (LV, Channel, Prada, etc...) all still entered China because there are people who would line up for it in China and everywhere else Chinese goes touring to. However, maintenance-wise...I can't imagine how much Disney will spend on that especially with things being trashed already.

 

[nilla]

How does a communist government allow for that?

China's not really "communist" anymore. There is still state ownership of major industries, but a lot has become privatized. Here's a good article about it:

http://www.slate.com/articles/news_and_politics/explainer/2010/07/how_communist_is_china.html

 

[RedSox68]

Well I agree with Wang on one thing .... "Wang said in the CCTV interview. “They shouldn't have entered China."

Lose-Lose. Disney could build against the threats that they were going to build it with or without Disney. OR. Disney could refuse to build, they build and steal it all giving Disney nothing, there is no recourse.

I think he underestimates the power of the real thing in this instance. And don't think it will take that long to turn a profit IF Disney is smart and is careful with further building, keeping it in check with incoming cash so they don't dig the hole too deep. But I think it's very sad that a country is permitted by the rest of the world to steal their IP and technology on an ongoing basis. Stop selling to them and stop allowing them to purchase our companies.

Well somewhere, somehow, somebody signed off on them building in China!

 

[ChrisFL]

I thought China's richest man was the really short dude that owns Alibaba

 

[OKW Lover]

Sorry if this is the wrong forum. Says Disney won't be profitable in China for 10-20 years?

http://www.msn.com/en-us/money/companies/china’s-richest-man-just-picked-a-fight-with-disneyland/ar-BBtpn1Y?li=BBnbfcL

Ok, so I read the story but all I get out of it is a lot of bluster on the part of somebody who is apparently offended by Disney. Not sure why that is, but even if he's the "richest man in china" he is just one voice. Disney probably isn't expecting him to come to the park. He's not the target audience.

But, its entirely possible that Disney won't be profitable in China (presumably he only means Shanghai, not the Hong Kong park too) for 10+ years. Look at what happened in EuroDisney. Then again, maybe Disney learned something from their EuroDisney and Hong Kong DL experience and have adjusted their action plans accordingly.

In other words, now that Disney has given Wanda a park right there in China to study up on to make knockoffs of, they're going to go forth and make knockoffs, just like they do of regular consumer products.

Ummm, if they wanted to make a knockoff why wouldn't they just go look at Hong Kong? Or any of the other Disney parks?

 

[manning]

China's not really "communist" anymore. There is still state ownership of major industries, but a lot has become privatized. Here's a good article about it:

http://www.slate.com/articles/news_and_politics/explainer/2010/07/how_communist_is_china.html

Tell China that. They have not given up control of the people. I don't think you want to speak up against the government.

 

[cbsnyber1]

But, its entirely possible that Disney won't be profitable in China (presumably he only means Shanghai, not the Hong Kong park too) for 10+ years. Look at what happened in EuroDisney. Then again, maybe Disney learned something from their EuroDisney and Hong Kong DL experience and have adjusted their action plans accordingly.

Maybe Disney didn't. There is this:

"Tickets for Wanda’s Jiangxi park, located in the provincial capital Nanchang, are priced at 198 yuan on most days and 248 yuan on holidays and weekends. That’s about half the price of Shanghai Disneyland, which charges adults 370 yuan each for regular tickets and 499 yuan during peak days" (499 yuan is about $76 US)

(Source: http://www.bloomberg.com/news/artic...ng-says-disney-no-match-for-wanda-s-wolf-pack)

The high ticket prices stem from the high construction costs, so did Disney make an initial mis-calculation when planning the park on how much the average Chinese person wants to spend? I guess we'll soon find out.

I'm sure the initial attendance will be great from the curiosity factor alone, but there is this fact: Hong Kong Disneyland had seven straight years of losses until finally making a profit in 2012. It made money for a few years then had a loss for fiscal 2015. And they estimate that 48% of it's attendance comes from mainland China.

So if Shanghai attendance drops - don't forget that Wanda plans to build parks throughout China - and doesn't recover it puts Disney in a pickle - what can it do short of lowering ticket prices, which will kill profits?

 

[OKW Lover]

All good points @cbsnyber1. I guess it just depends on if your a half full or half empty kind of person.

 

[PortMickey]

Wanda is already blatantly knocking off Disney Rides:

Toy Story Mania (1:27) Those are exact knock off ride vehicles and guns
Soarin' (2:30) Exact Knock off

I'm sure many more to come!