Disney is hurting for cash

[Eric Smith]

disney is defiantely losing money if they dont pull mulan they will lose more money

How would they lose more money by releasing Mulan?

 

[Edward90]

the lack of people going to the movies

 

[TiggerBouncy]

the lack of people going to the movies

Most of the expense has already been incurred. The cost of releasing is minor comparatively. They will delay it until the theaters are largely open across the country, but they will release it. However, you are correct that it will almost certainly be a financial loss any way you cut it and probably be due for an early conversion to Disney+.

 

[middlechild]

People in theaters is only one way to cash in on a new movie. Without theater goers, the ancillary sales of plush toys, souvenirs, action figures, clothes for kids and adults, tie in marketing to other merchandising. Without a solid buzz of theater talk, without the press surrounding a summer blockbuster, then Disney is losing money.

 

[Eric Smith]

Most of the expense has already been incurred. The cost of releasing is minor comparatively. They will delay it until the theaters are largely open across the country, but they will release it. However, you are correct that it will almost certainly be a financial loss any way you cut it and probably be due for an early conversion to Disney+.

I think they'll make money on it, especially when they release it in China. There's no reason for Disney not to hold it back until theaters open back up.

 

[New Mouse]

Most of the expense has already been incurred. The cost of releasing is minor comparatively. They will delay it until the theaters are largely open across the country, but they will release it. However, you are correct that it will almost certainly be a financial loss any way you cut it and probably be due for an early conversion to Disney+.

People seem to forget that with theaters its a chicken and egg scenario...chain theaters have 0 incentive to open without new movies. Movies have no incentive to release if they have no audience.

 

[mshanson3121]

Yes I know that. If it was that bad they wouldn't open. Disney can forecast these things. They have tons of data.

They have no data for this because this is a brand new and evolving situation. They're flying by the seat of their pants just like every other business. Example: in the spring they said they underestimated the demand for business. Then Florida became the epicenter and demand died and the parks are dead.

 

[TiggerBouncy]

I think they'll make money on it, especially when they release it in China. There's no reason for Disney not to hold it back until theaters open back up.

With international sales, you are probably right. Especially because some countries are a lot less restrictive than we are. Domestic box office sales alone, I doubt it.

Mulan had a budget of 200 million (more than Aladdin cost). Domestic box office sales for Aladdin were 350 Mil. Considering that most theaters are operating at under 50% (if at all - mine is not even open) and a lot of people are just not going, and the hype is a lot less due to marketing constraints, I just do not see Mulan making 60% of domestic ticket sales of Aladdin. Don't get me wrong - as a stockholder, I would love to be proved wrong.

That said, Aladdin did make over 1 billion total global box office. Plus another 45 Million in DVD sales. That is not including ancillary sales of toys and merchandise. So yes, I suspect you are correct that at the end of the day, the movie taken as a whole will be a financial gain for the company. I was thinking more narrowly in terms of Domestic Box Office Sales - which is often what is used by Hollywood media to judge if a movie was a "successful" release.

 

[mshanson3121]

So, not relevant to this thread. With no contact tracing, no proof they got it in FL either.

Though there is a confirmed case after a trip to Disney. So, if they didn't get it at Disney, they were contagious at Disney. Either way, it's GOING to happen. It's inevitable.

 

[rteetz]

They have no data for this because this is a brand new and evolving situation. They're flying by the seat of their pants just like every other business. Example: in the spring they said they underestimated the demand for business. Then Florida became the epicenter and demand died and the parks are dead.

You don’t think they have data for how many people are coming into the parks? That’s what I’m talking about not the virus. Disney has loads of data about those coming into the parks, their capacity, the number that shows up, the number that doesn’t, etc. The park reservation system is a data mine they never had previously.

 

[mshanson3121]

You don’t think they have data for how many people are coming into the parks? That’s what I’m talking about not the virus. Disney has loads of data about those coming into the parks, their capacity, the number that shows up, the number that doesn’t, etc. The park reservation system is a data mine they never had previously.

You spoke as though they've had this data all along. They haven't. They've been open a week. After all the work and expense to re-open, they're not going to just shut down after a couple bad days like you made it sound. But if this continues and they keep bleeding money, then it certainly seems within the realm of possibility.

 

[TiggerBouncy]

People seem to forget that with theaters its a chicken and egg scenario...chain theaters have 0 incentive to open without new movies. Movies have no incentive to release if they have no audience.

Yes, and no.... Some of the more inventive theaters around here when everything started were getting smart about it. They were showing classics. One of the theaters here did an all day LOTR marathon.

Here in Maryland, by law they are not allowed to open. A number of them have gone bankrupt. The few surviving (and I do mean the few as almost half the ones around my area have closed permanently because they just didn't have the money to survive) will be allowed to reopen at the end of this month (August 1st) at 30% capacity.

So it's not about incentives for theaters to open. It's not a chicken and egg. It's about by law they have not been able to operate.

Even when they can, it's going to be a difficult environment AT BEST. First, they will be limited on capacity (numbers are not sure but we think between 30-50). Then, consider that theaters make their money on concessions. They are limited to no hot foods and no refills (basically popcorn, candy and soda only with contactless only payment). You are required to have your masks on. Many of htem are hoping they will be allowed to have masks off in the theater as you can't really eat your popcorn or soda because of the mask (it's really a pain to lift you mask every time you take a bite of popcorn). However, that is uncertain.

It's tough time to be a movie theater right now. There are a few "pop-up" drive-ins around though.

 

[rteetz]

You spoke as though they've had this data all along. They haven't. They've been open a week. After all the work and expense to re-open, they're not going to just shut down after a couple bad days like you made it sound. But if this continues and they keep bleeding money, then it certainly seems within the realm of possibility.

Yes but people make these reservations in advance. They knew how many hotel bookings they have as well. You forecast what the parks will look like from that. Of course they aren't going to just shut back down, I never said that. I believe they would look to close certain aspects of the operation before a full shut down like maybe closing some resorts back down or maybe even only keeping two parks open.

 

[mshanson3121]

Yes but people make these reservations in advance. They knew how many hotel bookings they have as well. You forecast what the parks will look like from that.

The reservation system hasn't exactly been open a long time either. But regardless, people make reservations, and then things change, and those people don't show up, or they cancel. Their predictive data has limited value in the current situation.

 

[New Mouse]

Yes, and no.... Some of the more inventive theaters around here when everything started were getting smart about it. They were showing classics. One of the theaters here did an all day LOTR marathon.

Here in Maryland, by law they are not allowed to open. A number of them have gone bankrupt. The few surviving (and I do mean the few as almost half the ones around my area have closed permanently because they just didn't have the money to survive) will be allowed to reopen at the end of this month (August 1st) at 30% capacity.

So it's not about incentives for theaters to open. It's not a chicken and egg. It's about by law they have not been able to operate.

Even when they can, it's going to be a difficult environment AT BEST. First, they will be limited on capacity (numbers are not sure but we think between 30-50). Then, consider that theaters make their money on concessions. They are limited to no hot foods and no refills (basically popcorn, candy and soda only with contactless only payment). You are required to have your masks on. Many of htem are hoping they will be allowed to have masks off in the theater as you can't really eat your popcorn or soda because of the mask (it's really a pain to lift you mask every time you take a bite of popcorn). However, that is uncertain.

It's tough time to be a movie theater right now. There are a few "pop-up" drive-ins around though.

30% doesnt pay the bills for studios or theaters. Theaters arent going to sell out 30% with classics either, so at that point it doesnt make sense to open until theres a new release.

 

[OSUZorba]

I am interested in this thread’s thoughts on the possibility that Disney’s financial situation will necessitate the closing of attractions. Pete W. mentioned on The Dis unplugged that the recent announcement of permanent closures is a harbinger of things to come. I agree; I told DW on our trip last week to take in everything we can because I think we will see fewer attractions in the future as Disney makes cuts to less popular attractions that need more maintenance and labor. Do others agree?

I don't agree with what Pete was saying. They might temporarily close some attractions and maybe we get one or two more permanent closures. But I don't think Disney is going to cut their way to growth, at least not on full attractions.

 

[Eric Smith]

I am interested in this thread’s thoughts on the possibility that Disney’s financial situation will necessitate the closing of attractions. Pete W. mentioned on The Dis unplugged that the recent announcement of permanent closures is a harbinger of things to come. I agree; I told DW on our trip last week to take in everything we can because I think we will see fewer attractions in the future as Disney makes cuts to less popular attractions that need more maintenance and labor. Do others agree?

I don't think they're going to close down any more attractions permanently. Stitch had actually been closed for at least a year. There had been persistent rumors about Primeval Whirl for quite a while and it was on seasonal operation before it was closed permanently. Rivers of Light was kind of a surprise but it was the least popular night time show and it won't be possible to put it on for quite a while anyways. I assume there is some kind of replacement in the works which will be debuted after the COVID situation is over.

Closing down attractions would be a self-defeating way of saving money. It might save a bit in the short term, but if there is less to do in the parks, then people may not be as drawn to visit.

 

[WickstarRunner]

I don't think they're going to close down any more attractions permanently. Stitch had actually been closed for at least a year. There had been persistent rumors about Primeval Whirl for quite a while and it was on seasonal operation before it was closed permanently. Rivers of Light was kind of a surprise but it was the least popular night time show and it won't be possible to put it on for quite a while anyways. I assume there is some kind of replacement in the works which will be debuted after the COVID situation is over.

Closing down attractions would be a self-defeating way of saving money. It might save a bit in the short term, but if there is less to do in the parks, then people may not be as drawn to visit.

I think you're right. What Pete failed to mention is that all three were widely assumed to be closing after the 50th at the latest anyway. ROL never really clicked, Stitch was a meet and greet recently and the company that made PW went out of business a while ago and Disney's had problems getting replacement parts. THAT'S why it was closed for a good chunk of last year.

Closing all three now saves 2 years of maintenance and cast costs and really doesn't hurt the park experience too much. Drawing conclusions form this move probably isn't a good idea.

 

[Paul70]

I think you're right. What Pete failed to mention is that all three were widely assumed to be closing after the 50th at the latest anyway. ROL never really clicked, Stitch was a meet and greet recently and the company that made PW went out of business a while ago and Disney's had problems getting replacement parts. THAT'S why it was closed for a good chunk of last year.

Closing all three now saves 2 years of maintenance and cast costs and really doesn't hurt the park experience too much. Drawing conclusions form this move probably isn't a good idea.

All fair points. Disney does need to be careful not to cross the line into territory where people feel the park experience has lost value. Nonetheless, I expect a meeting could happen (or has happened) with an agenda that would be the inverse of a “Blue Sky” session: what could be eliminated—no sacred cows—to cut costs while maintaining critical mass? I could see rides like The People Mover, Carousel of Progress, Country Bear Jamboree, along with anything that requires equity performers like parades and stage shows, facing cuts. Character Cavalcades are a lot cheaper than a Festival of Fantasy parade, and people still get to see Pooh and the Princesses go down Main Street. Fireworks and projection shows will be back, but I think the closure and the subsequent low attendance numbers will give execs little choice but to pare down attractions to cut costs.

 

[TiggerBouncy]

All fair points. Disney does need to be careful not to cross the line into territory where people feel the park experience has lost value. Nonetheless, I expect a meeting could happen (or has happened) with an agenda that would be the inverse of a “Blue Sky” session: what could be eliminated—no sacred cows—to cut costs while maintaining critical mass? I could see rides like The People Mover, Carousel of Progress, Country Bear Jamboree, along with anything that requires equity performers like parades and stage shows, facing cuts. Character Cavalcades are a lot cheaper than a Festival of Fantasy parade, and people still get to see Pooh and the Princesses go down Main Street. Fireworks and projection shows will be back, but I think the closure and the subsequent low attendance numbers will give execs little choice but to pare down attractions to cut costs.

It'll be a cold day in you know where before they close CoP for anything but updates.