Budget cuts at Walt Disney World

[adam.adbe]

So that raises an interesting question in my mind. It's purely speculative because Disney won't spin off 40% of their revenue when the largest remaining portion is shrinking.

To further stoke your your ill-will towards wall street: even if it't not in the best interest of the company, a well financed team of 'activist'[1] shareholders could make it very hard for Disney to do otherwise.

However, back to the rhetorical:

Would Disney Parks be better off as a separate company where all the focus is on the parks? Or would we see the same management style anyway?

Honestly, I've come to believe firmly that Disney's problem is institutional. If Disney found themselves in second place, do we think they'd suddenly develop an appetite? Plenty of once hungry companies, lose their way and then waste time and talent slowly dying from the inside out. Splitting the company down the middle just means you have two smaller companies with all the same afflictions: the hubris will remain; the in-fighting will persist; and the short-sighted market chasing will potentially worsen because smaller companies are even more vulnerable to a capricious stock market. About the only thing I could see changing is that the new Disney Parks entity would be freed from a reliance of Disney IP. Whether that's good or bad is going to come down to personal tastes.

Disney needs to do more than start regarding say Universal (and perhaps eventually even Merlin) as serious competition, IMV it needs to remember why Disney once *was* peerless. That's philosophical, and the kind of change that would take a CEO with an extraordinary amount of charisma to drive.

[1] scare quotes because I hate the term almost as much as a I hate the usual participants[2].

[2] I once read someone define Carl Icahn's basic purpose in life as "getting paid to go away."

 

[TwoMisfits]

Budget cuts the subject of Disney all week. Disney PR thinking let's announce this new Star Wars show so we can cover that up. Problem solved they will now talk about Star Wars fireworks instead of the cuts. It makes sense now. Typically disney wouldn't announce this on a Friday.

This 1000%. Cynical ploy by Disney b/c they know anything they say that includes STAR WARS!!! will stop all other discussion and get everyone discussing how awesome they and their plans are...instead of how cheap they are being right now and how much they are screwing employees. Disney had to change the social media trends and they know they have few (cheap) items left in their back pocket that will do it...they used one up now...

 

[sachilles]

 

[adam.adbe]

and the financial and ethnic/cultural problems in the EU are the worst they've been since the 1930s.

You mean the late 40s, surely? For the record, I'd strongly disagree with that also.

 

[Josh Hendy]

You mean the late 40s, surely? For the record, I'd strongly disagree with that also.

I mean, Europe's financial problems of the Great Depression which were combined with mounting national/ethnic/religious tensions. Circa 1929-39.

Not sure why you're thinking of the late 40s. The Marshall Plan and the Berlin Airlift?

 

[Josh Hendy]

This 1000%. Cynical ploy by Disney b/c they know anything they say that includes STAR WARS!!! will stop all other discussion and get everyone discussing how awesome they and their plans are...

I wonder if Star Wars has legs that are all that long. The movie is a lot of fun and it was a legitimate blockbuster. Many people are/were all abuzz about the movie and its deeper meaning such as who is Rey's aunt and whether young Ben Solo is too whiny to be a Sith.

But is that success big enough to paper over the weaknesses of DHS? I mean, with nothing but fireworks, shaking hands with people in costumes and looking at props in glass cases and construction walls ... for at least 4 years and maybe 5. And we don't even have construction walls to look at yet.

I was wondering the same thing about Frozen the other day when I saw the aerial shot of the new M&G building. Has any character in the entire Disney/Pixar/Lucas/Marvel/Muppet pantheon ever been given a dedicated M&G building as large and elaborate as A&E's? Including Mickey Mouse.

It's taking a big chance to bet on theme park success not with great rides but only with the charisma and staying power of a small handful of characters from a couple of movies.

 

[adam.adbe]

I mean, Europe's financial problems of the Great Depression which were combined with mounting national/ethnic/religious tensions. Circa 1929-39.

Not sure why you're thinking of the late 40s. The Marshall Plan and the Berlin Airlift?

Well otherwise you're saying Europe's social and economic health is currently worse than it was during at least the last five years of the Second World War? And again, European countries independently, and collectively, have gone through some serious social/economic challenges since the 50s. I'm not sure this is the worst of them. I don't even think it's the worst I've lived through.

I do agree though that the idea of a common Europe is facing increasingly hard to solve problems, and that could spell big problems in the near future.

 

[sachilles]

http://www.orlandosentinel.com/business/tourism/os-disney-layoffs-hours-cut-20160216-story.html

Just wanted to put the original Orlando Sentinel link in the thread. As many article online site it, but I feel much has been taken out of context. If you haven't read the original article, I highly recommend reading it.

 

[rteetz]

And we don't even have construction walls to look at yet.

We do actually, and will have even more April 2nd.

 

[rteetz]

I was wondering the same thing about Frozen the other day when I saw the aerial shot of the new M&G building. Has any character in the entire Disney/Pixar/Lucas/Marvel/Muppet pantheon ever been given a dedicated M&G building as large and elaborate as A&E's? Including Mickey Mouse.

The only thing that comes close to it is Princess Fairy Tale hall but that's all Disney princesses.

 

[rteetz]

http://www.orlandosentinel.com/business/tourism/os-disney-layoffs-hours-cut-20160216-story.html

Just wanted to put the original Orlando Sentinel link in the thread. As many article online site it, but I feel much has been taken out of context. If you haven't read the original article, I highly recommend reading it.

Sandra tries but not hard enough.

 

[Josh Hendy]

Well otherwise you're saying Europe's social and economic health is currently worse than it was during at least the last five years of the Second World War?

No. That's not what I said. I said that the situation is the worst SINCE the 1930s ... which was the decade before WW2.

 

[circus4u]

When they first introduced park tickets for the Magic Kingdom (rather than attraction books) in 1982 the price was less than $14. Which in todays money would be all of $34.37. Disney's price increases have never been tied to inflation. They won't drop the price to enter the parks below the current level no matter what changes they make. In fact I am certain there will be an increase though $125 is just a random number I picked to illustrate.

Actually, there were two tickets to get into the Magic Kingdom when it first opened. You had one "transportation" ticket just to get into the Ticket and Transportation center that covered your transportation to the Magic Kingdom. Once you got to the gate, you had another ticket to get into the park. If you didn't want to ride anything, those were the only two tickets needed. If you changed your mind once you got into the park or ran out of attraction tickets, you could purchase additional tickets at booths located in each land. And yes, Hall of Presidents was extremely popular as was American Adventure in Epcot when it first opened. Actually, I still have some of my unused ticket books around here somewhere.

 

[lockedoutlogic]

Sandra tries but not hard enough.

I think the sentinel...as always...tries to make the sting go away with the standard quotes from "analysts".

But it's lipstick on a pig here. Not to harp...but here's what matters to my uniformed ears:
1. I've now had multiple reports that the "we have to increase prices because there's so many people..." Has been released top down - like an invasive species - in the resort. It's classic cloak and dagger nonsense from "The Company"
2. Reducing people to 32 hours in a BOOM PERIOD...just shouldn't sit right with anyone. They aren't well paid in the first place...and it's a completely dangerous approach.
Do you want your guest service reps going to work angry? Or tired due to having to look for outside work? You think that's not gonna hit the value of your precious vacation? Foolish.

And if it was a rough patch you could see it. Bad now...back to normal
Later.
But how does that go in a mob scene?

The new normal? It's shady. Now all we need is one of their cheap business suit 26 year old "spokeswomen" to try to infer that it's because of Obamacare...then the circle will be complete.

It would be very hard to defend the wall here...but fire away if you got it.

 

[Planogirl]

The only thing that comes close to it is Princess Fairy Tale hall but that's all Disney princesses.

They need somewhere to put the queues hence the size. Besides IF people finally lose interest in A&E, it'll be a simple process to turn the building into Fairy Tale Hall 2 and then it will go well with Akershus.

 

[cmash95]

whoever said that disney is cutting operations budgets because capitol outlays at some parks are over budget doesn;t understand accounting. One has nothing to do with the other. there are reasons that things are being cut and its because other things are being brought online. In a few months we will have a new nighttime show at the studios as well as river's of light so there is no need to have a second parade at Mk because the crowds will be elsewhere. and the reason staff hours are beinglimited is because they started this quarter over budget and haven;t had a chance to make it up in some departments. I know for a fact that there are certain operational depts. that are understaffed and those Cms are working maximum hours and still doing forced 6 days, but not alot of them. It seems the Cp's got started a little later and with January and early feburary becoming, run times, the parks are still pretty crowded. there will be a bit of a break for about threeweeks until the end of march when spring break weeks kick in. and then in april the next quarter starts and thus a new budget. also no parks are losing the number of characters meeting or greeting, they are changing them out. yes winnie the pooh and tigger are leaving but anna and elsa are coming. and aurora is leaving but inside out is coming. sometimes people have to look at what is coming or wait until they have all the facts before they assume things

 

[lockedoutlogic]

whoever said that disney is cutting operations budgets because capitol outlays at some parks are over budget doesn;t understand accounting. One has nothing to do with the other. there are reasons that things are being cut and its because other things are being brought online. In a few months we will have a new nighttime show at the studios as well as river's of light so there is no need to have a second parade at Mk because the crowds will be elsewhere. and the reason staff hours are beinglimited is because they started this quarter over budget and haven;t had a chance to make it up in some departments. I know for a fact that there are certain operational depts. that are understaffed and those Cms are working maximum hours and still doing forced 6 days, but not alot of them. It seems the Cp's got started a little later and with January and early feburary becoming, run times, the parks are still pretty crowded. there will be a bit of a break for about threeweeks until the end of march when spring break weeks kick in. and then in april the next quarter starts and thus a new budget. also no parks are losing the number of characters meeting or greeting, they are changing them out. yes winnie the pooh and tigger are leaving but anna and elsa are coming. and aurora is leaving but inside out is coming. sometimes people have to look at what is coming or wait until they have all the facts before they assume things

I get what you're saying and on one hand it all seems perfectly reasonable...

But it still looks like a bad move if it's more than just an abundance of painters.

It's just not a very good sign to go to four days in departments when the attendance never really takes a break. And yes - some places have been on six In the past while others were four. The way they handle that is to turnover more open slots in busy classifications while letting spots go empty in others.

Since they have largely considered 50,000 ish nametags completely unskilled and therefore completely cookie cutter - what's the problem?

And realize that's not what I think shoulda happened...but it's what they did 20 years ago.

No matter what reasons they spin this time...they look bad. "The company" should shove it here and not patronize anybody with justifications. The penny pinching of low paid workers looks like lack of couth here...

 

[rteetz]

whoever said that disney is cutting operations budgets because capitol outlays at some parks are over budget doesn;t understand accounting. One has nothing to do with the other. there are reasons that things are being cut and its because other things are being brought online. In a few months we will have a new nighttime show at the studios as well as river's of light so there is no need to have a second parade at Mk because the crowds will be elsewhere. and the reason staff hours are beinglimited is because they started this quarter over budget and haven;t had a chance to make it up in some departments. I know for a fact that there are certain operational depts. that are understaffed and those Cms are working maximum hours and still doing forced 6 days, but not alot of them. It seems the Cp's got started a little later and with January and early feburary becoming, run times, the parks are still pretty crowded. there will be a bit of a break for about threeweeks until the end of march when spring break weeks kick in. and then in april the next quarter starts and thus a new budget. also no parks are losing the number of characters meeting or greeting, they are changing them out. yes winnie the pooh and tigger are leaving but anna and elsa are coming. and aurora is leaving but inside out is coming. sometimes people have to look at what is coming or wait until they have all the facts before they assume things

That is true, but what about cuts at the gift shops? Or park hours? They also have to pay for the Shanghai problems some how. I think it all goes together.

 

[Eoghann]

whoever said that disney is cutting operations budgets because capitol outlays at some parks are over budget doesn;t understand accounting.

Actually that's not entirely true. Capital Expenses and Operations are separate budgets yes, but budget over-runs in one area can end up affecting others because at the end of the day all the numbers feed upwards to an overall total for Parks and Resorts and someone answers for hitting that number.

If someone at a high enough level in the company looks at the whole Parks and Resorts budget and says "we have to make up for the CAPEX over-runs, where can we squeeze extra money from?" yes they could chose to cut operations budget to do it.

Budgets in large companies are not fixed things. They get changed all the time, even mid-year.

Accounting is a shell game.

 

[Budshark]

Exactly. At a low level department view they are separate. At an executive and board level they are part of one big cost structure.