Disney Set To Announce Ambitious Star Wars Theme Park

[rteetz]

You touched on my thinking about the way Disney views the Orlando parks when you said, "they continue to let Epcot decay". I really feel they have so missed the boat on park upgrades and refurbs over the last 12 years. That's why my posts are so negative. It just seems they are intent on sapping every dollar they can out of the Florida parks. It's like they know they don't have to lead and be innovative in FL because it rakes in so much money. The last earning report sort of bears that out. You have 3 parks (EP, HS, and AK) that are so starved of attractions and updates, and yet they are setting attendance records.

Well at least they are finally doing something with AK. The Epcot vision was lost long ago. If they were to keep up with those visions at Epcot it would cost billions. DHS needs something it has five attractions three of which I can get a FP for. That park is definitely a half day park right now.

 

[lockedoutlogic]

MGM is not nearly the size of the other 3….they aren't getting 5-7 million more in there no matter if they have alec guinness thawed out from cryofreeze and eating dinner with you….

footprint is a big problem. They can take the completely useless production and backlot areas and convert…that seems to be the way its heading…but even still the actual size is small. and they have to do roadwork and parking lot upgrades because of the bizarre two entry approach they took in the late 80's…

so how do you make studios a "full day park"? it can be done - no doubt…
1.5-2 billion. in todays dollars and on their own self defeating construction schedules…

and what if it doesn't hit? even with star wars thats a huge gain at the gates and right now the park is pretty much "overcrowded" at 10 mil. Why spend that kinda cash for a park that will be "less crowded" on average of they get 12-13 in there?

and…if you notice whats going on down the road…we still are forgetting the "feeder park" scenario. as in they want ak and dhs to empty into Downtown, Epcot, and MK in that order in the evenings. its maximizing profits with maximized overhead.

even after the work at animal kingdom…they're not packing the place till close….they'll still get a lot of late day defection…and thats probably ok with them.

 

[lockedoutlogic]

That's the thing, MK is in a league of its own. Disneyland Park, Tokyo Disney Seas, Tokyo Disneyland, Magic Kingdom, Parc Disneyland are all super parks that can make or break their Resorts. There's millions of guests of difference between these parks and any others on the Planet. I think Disney wants to bring DHS into this elite group.

How so?

If they wanted a "make or break" park to add to WDW - it would be animal kingdom due to infrastructure, size, and overhead.
I've never gotten any indication that they want "big things" from studios….
the sunset boulevard addition in the 90's was probably a tough sell for eisner to make..with two frontline attractions. i don't think CMB would approve it now.

and without that - its just as wimpy as Studios Paris….and that is less exciting than your average six flags

 

[rteetz]

How so?

If they wanted a "make or break" park to add to WDW - it would be animal kingdom due to infrastructure, size, and overhead.
I've never gotten any indication that they want "big things" from studios….
the sunset boulevard addition in the 90's was probably a tough sell for eisner to make..with two frontline attractions. i don't think CMB would approve it now.

and without that - its just as wimpy as Studios Paris….and that is less exciting than your average six flags

I agree. There was also supposed to be a second phase to sunset boulevard with roger rabbit but it never happened. Rumors are that a budget has been set for DHS that will be over 1 billion.

 

[DDLand]

MGM is not nearly the size of the other 3….they aren't getting 5-7 million more in there no matter if they have alec guinness thawed out form cryofreeze and eating dinner with you….

footprint is a big problem. They can take the completely useless production and backlot areas and convert…that seems to be the way its heading…but even still the actual size is small. and they have to do roadwork and parking lot upgrades because of the bizarre two entry approach they took in the late 80's…

so how do you make studios a "full day park"? it can be done - no doubt…
1.5-2 billion. in todays dollars and on their own self defeating construction schedules…

and what if it doesn't hit? even with star wars thats a huge gain at the gates and right now the park is pretty much "overcrowded" at 10 mil. Why spend that kinda cash for a park that will be "less crowded" on average of they get 12-13 in there?

and…if you notice whats going on down the road…we still are forgetting the "feeder park" scenario. as in they want ak and dhs to empty into Downtown, Epcot, and MK in that order in the evenings. its maximizing profits with maximized overhead.

even after the work at animal kingdom…they're not packing the place till close….they'll still get a lot of late day defection…and thats probably ok with them.

I'm inclined to think they're following the same strategy of picking each trouble park and fixing it. If they're content with similar attendance then they wouldn't be spending money. I know we like to complain about it as a trouble park or half day, but the night life is there already and there's enough to stay longer then DAK. There's one figure Disney wants up, and that attendance. Nothing else makes sense in context to what they're doing. This is not a purely defensive move as some have suggested. That's not what justifies multi hundred million dollar expansions. They need to see a discernible increase in revenue.

DAK is limited due to theme. There are just so many avenues to go down for DHS.

 

[Flamingeaux]

It must be true, Brian Williams said it was a done deal on Letterman last night.

 

[lockedoutlogic]

It must be true, Brian Williams said it was a done deal on Letterman last night.

Right...and I heard Sean hannity said it was unamerican and doesn't support the troops

 

[lockedoutlogic]

I'm inclined to think they're following the same strategy of picking each trouble park and fixing it. If they're content with similar attendance then they wouldn't be spending money. I know we like to complain about it as a trouble park or half day, but the night life is there already and there's enough to stay longer then DAK. There's one figure Disney wants up, and that attendance. Nothing else makes sense in context to what they're doing. This is not a purely defensive move as some have suggested. That's not what justifies multi hundred million dollar expansions. They need to see a discernible increase in revenue.

DAK is limited due to theme. There are just so many avenues to go down for DHS.

The one statistic they care about is guest spending per day...

They'd rather have 5 million that spend $300 a day than 10 million that spend $150

More
Money that way.

 

[clsteve]

I'm inclined to think they're following the same strategy of picking each trouble park and fixing it. If they're content with similar attendance then they wouldn't be spending money. I know we like to complain about it as a trouble park or half day, but the night life is there already and there's enough to stay longer then DAK. There's one figure Disney wants up, and that attendance. Nothing else makes sense in context to what they're doing. This is not a purely defensive move as some have suggested. That's not what justifies multi hundred million dollar expansions. They need to see a discernible increase in revenue.
DAK is limited due to theme. There are just so many avenues to go down for DHS.

To the bolded, I think Disney has shown recently that they would be more than happy with the exact opposite --- happy to continue along with single digit attendance increases as long as top line rev and profitability hit their targets.

All you have to do is look at their largest WDW Parks investment in years - NextGen. And as they've publicly stated too many times to count - it's focused on farming - getting maximum yield out of the existing footprint and minimal go forward liability and expense. Same thing on the Resorts side, DVC conversion of existing decades-old structures - minimal increase in ongoing ops expense after significant cash upfront

They've shown pretty specifically that they only want attendance up as long as the impact is minimal to the bottom line - headcount, liability, etc., etc.,....

So, whether its Star Wars or anything else in DHS after whatever becomes of Avatar - CapEx for things we want is more than likely going to mean something else is cut or optimized, operationally. They're at 70,000+ employees. The Orlando employee market is only so big.

It's the big gorilla we should photoshop into every expansion rumor that pops up for WDW...

 

[DDLand]

To the bolded, I think Disney has shown recently that they would be more than happy with the exact opposite --- happy to continue along with single digit attendance increases as long as top line rev and profitability hit their targets.

All you have to do is look at their largest WDW Parks investment in years - NextGen. And as they've publicly stated too many times to count - it's focused on farming - getting maximum yield out of the existing footprint and minimal go forward liability and expense. Same thing on the Resorts side, DVC conversion of existing decades-old structures - minimal increase in ongoing ops expense after significant cash upfront

They've shown pretty specifically that they only want attendance up as long as the impact is minimal to the bottom line - headcount, liability, etc., etc.,....

So, whether its Star Wars or anything else in DHS after whatever becomes of Avatar - CapEx for things we want is more than likely going to mean something else is cut or optimized, operationally. They're at 70,000+ employees. The Orlando employee market is only so big.

It's the big gorilla we should photoshop into every expansion rumor that pops up for WDW...

I'm with you're point Parks and Resorts wide. However, how do additional expensive rides and attractions help in DHS's case? If we're under the impression that attendance is not going to tick significantly upwards, what's the point? Basically they're going to be offering a much better product for the same price to the same amount of people. That's illogical. That's why I'd say attendance numbers are the only way this going to be successful. After DCA investors are expecting amazing things attendance wise. This is all about driving more people to the same park.

 

[clsteve]

I'm with you're point Parks and Resorts wide. However, how do additional expensive rides and attractions help in DHS's case? If we're under the impression that attendance is not going to tick significantly upwards, what's the point? Basically they're going to be offering a much better product for the same price to the same amount of people. That's illogical. That's why I'd say attendance numbers are the only way this going to be successful. After DCA investors are expecting amazing things attendance wise. This is all about driving more people to the same park.

What expensive rides....?

 

[DDLand]

The one statistic they care about is guest spending per day...

They'd rather have 5 million that spend $300 a day than 10 million that spend $150

More
Money that way.

Yes, that's almost always correct. (There are cost benefits in terms of critical mass)

I'm certainly not saying attendance is their number one priority Parks and Resorts wide. Anyone who's seen the consistent price increases over the last couple years could tell you that. (The best comparison is with Apple in Smartphones, they ceded the market to Android makers but they are hugely more profitable) In context of DHS however, they basically have to boost attendance to justify the spending. How are they expecting to gain a return on their investment? Increased Star Wars merchandise sales? That's what lead me to say that, I should've been more clear in the context I was speaking.

I don't see how they can go to the board and sell this without increases of 5 million. My theory is end goal of 6+ million. This is in context of spending potentially DCA levels of money for a park that is arguably just fine.

 

[DDLand]

What expensive rides....?

That's kind of the point of both of these expansions. Rumors place spending at DCA levels. You're telling me we won't have at least two e-tickets for $1,000,000,000 spending? That doesn't sound good...

 

[rteetz]

Yes, that's almost always correct. (There are cost benefits in terms of critical mass)

I'm certainly not saying attendance is their number one priority Parks and Resorts wide. Anyone who's seen the consistent price increases over the last couple years could tell you that. (The best comparison is with Apple in Smartphones, they ceded the market to Android makers but they are hugely more profitable) In context of DHS however, they basically have to boost attendance to justify the spending. How are they expecting to gain a return on their investment? Increased Star Wars merchandise sales? That's what lead me to say that, I should've been more clear in the context I was speaking.

I don't see how they can go to the board and sell this without increases of 5 million. My theory is end goal of 6+ million. This is in context of spending potentially DCA levels of money for a park that is arguably just fine.

And rumors certainly point to a DCA style budget for DHS.

 

[clsteve]

That's kind of the point of both of these expansions. Rumors place spending at DCA levels. You're telling me we won't have at least two e-tickets for $1,000,000,000 spending? That doesn't sound good...

So, we're talking what - 5 years until we see those expensive rides..?

It was a baited question. Apologies.

In that time, they're already realizing a significant OpEx benefit with what's already closed with no shovels in the ground and will realize it for the whole build. By the time whatever they do build finally opens (getting back to the area's original ride capacity, more than likely), it's not going out on the limb to expect additional OpEx optimization to cover the whatever is the new area of build for post 2020.

It's where they are - where they see WDW as a high yield asset - minus significant outside pressures beyond their control that force a change of strategy.

Objectively, it is what it is.....

 

[rteetz]

That's kind of the point of both of these expansions. Rumors place spending at DCA levels. You're telling me we won't have at least two e-tickets for $1,000,000,000 spending? That doesn't sound good...

Even with that budget I think we only see one e ticket. That's all DHS really needs. What that park does lack is family attractions things like toy story play land would bring.

 

[DDLand]

Even with that budget I think we only see one e ticket. That's all DHS really needs. What that park does lack is family attractions things like toy story play land would bring.

I see one anchor attraction in each land. An E-Ticket and a D-Ticket in Star Wars Land, and an E-Ticket and several B and C-Tickets for Pixar Land. I think they'll need those big cap rides in each land that can absorb several thousand people per hour. They're big franchises and they may as well make two solid attractions especially with that budget.

 

[rteetz]

I see one anchor attraction in each land. An E-Ticket and a D-Ticket in Star Wars Land, and an E-Ticket and several B and C-Tickets for Pixar Land. I think they'll need those big cap rides in each land that can absorb several thousand people per hour. They're big franchises and they may as well make two solid attractions especially with that budget.

I don't think they get an E for Pixar. All sources say the one and only e ticket will be Star Wars.

 

[DDLand]

I don't think they get an E for Pixar. All sources say the one and only e ticket will be Star Wars.

Interesting, and not what I was expecting. RSRs at DCA is crucial in drawing people into that part of the park and then people explore and find the other attractions. In the same way I was expecting the Pixar land to have a draw like that. I wonder how they're going to spend the money if not like that. The entire Hong Kong Toy Story Land with which many rides are said to be cloned, was built within one 500 million dollar budget. I wonder how they're going to blow it.

 

[DDLand]

So, we're talking what - 5 years until we see those expensive rides..?

It was a baited question. Apologies.

In that time, they're already realizing a significant OpEx benefit with what's already closed with no shovels in the ground and will realize it for the whole build. By the time whatever they do build finally opens (getting back to the area's original ride capacity, more than likely), it's not going out on the limb to expect additional OpEx optimization to cover the whatever is the new area of build for post 2020.

It's where they are - where they see WDW as a high yield asset - minus significant outside pressures beyond their control that force a change of strategy.

Objectively, it is what it is.....

Once again, the end cost will still be greater in the long run. Any savings gained by the backlot tour closure would be marginal at best. Compared to the massive expenditures incurred by building up a major rides and attractions they're not even in the same ballpark. The end goal is to create a significant draw to DHS similar in size to DCA. So far attendance at DCA has increased by something like 3 million and there's massive upside to that still. That's the type of ROI Disney wants out of DHS.