Marvel Is Taking Over Disney

[Rumors Rocks]

Article: Marvel Is Taking Over Disney -- and That's a Good Thing http://www.fool.com/investing/gener...taking-over-disney-and-thats-a-good-thin.aspx

By Travis Hoium | More Articles
January 10, 2014 | Comments (0)

When Disney (NYSE: DIS ) agreed to pay $4 billion for Marvel in 2009, it was a steep price for a studio with little filmmaking experience. A few years later, the vision for Marvel predicted by Disney CEO Bob Iger is playing out and the studio is becoming the face of Disney.

When you consider the success Marvel has had over the past few years, it's probably good that Disney is giving it such a prominent role, and it's only going to grow as Marvel's characters develop and new distribution outlets emerge.

Marvel takes over the box office

In the past two years; Marvel has come to dominate the box office for Disney. Iron Man 3 and The Avengers nearly doubled the second- and third-best performing films of the year, and both were tops at the box office overall for the year.

What's important about this box office success is that Disney can translate it to more superhero films and TV shows in the future.

Spinoff season for Marvel

Agents of Shield is the first major Marvel spinoff to the small screen, and it has done well, ranking second behind the ever-popular NCIS on Tuesday nights on ABC, one of Disney's networks. The next spinoff from Marvel's box-office success will come on Netflix, which recently agreed to a deal that will bring series about Daredevil, Jessica Jones, Iron Fist, and Luke Cage to its streaming service.

On the big screen, besides continuing with classic heroes like Thor and Captain America, Marvel is creating new opportunities to develop characters with Guardians of the Galaxy, due out this year. As time goes on, more of these spinoffs will pop up and Disney will find ways to create more value from a world of Marvel characters across a variety of platforms.

How to build value, Disney style

What makes Marvel a phenomenal investment for Disney is that the characters will live on for years in a variety of ways.


Marvel merchandise now sits alongside Disney and Pixar goods at Disney stores.

Not only does Disney own major television networks, in the last fiscal year the company generated more than twice as much revenue and more than five times as much operating income from parks and resorts as it did from studio entertainment. That's where Disney separates itself from the competition.

The key to drawing customers to these theme parks is having rides and characters that are popular. Mickey Mouse is no longer the draw he was when Disney World opened, but Iron Man or the Hulk walking about the park or helming a themed ride creates a new draw.

Marvel is the future of Disney

Theme parks are where Disney can create long-lasting value for shareholders and it's why the company is so well positioned for the future of media. With strong characters from Marvel, Disney gets not only box-office success but also content to distribute through existing media networks and new streaming sources, as well as at theme parks. No other media company has that kind of cash-generation cycle, and Marvel is becoming the face of all of these businesses.

 

[yitbos96bb]

That article seems to fall under the "Well duh" category, but I guess they have to justify the service to investors.

 

[rteetz]

Only one problem marvel won't come to Orlando at least for the next 5-10 years. I think they will strongly push marvel at over seas park tho as well as on the cruise line which is already happening.

 

[Yellowstonetim]

Article: Marvel Is Taking Over Disney -- and That's a Good Thing http://www.fool.com/investing/gener...taking-over-disney-and-thats-a-good-thin.aspx

Excellent article! Thanks for posting. I'm stoked! Another great acquisition is paying off. Disney has certainly been making the right acquisitions in the last number of years!

 

[mouseguy77]

The Pixar, Marvel and Lucas film acquisitions really are going to be Iger's legacy. He has set Disney up for decades of success.

 

[disneylovin24]

The Pixar, Marvel and Lucas film acquisitions really are going to be Iger's legacy. He has set Disney up for decades of success.

He definitely has set Disney up on the film side of things! Building a legacy kind of like Eisner's. Eisner did more with the parks than Iger so far but he also brought back Disney animation studios to glory days. Looks like both have sent Disney in the right direction when it comes to films.

 

[Polydweller]

Only one problem marvel won't come to Orlando at least for the next 5-10 years. I think they will strongly push marvel at over seas park tho as well as on the cruise line which is already happening.

Longer than that for Orlando. Uni owns the rights east of the Mississippi in perpetuity, and yes it really is that way.

 

[rteetz]

Longer than that for Orlando. Uni owns the rights east of the Mississippi in perpetuity, and yes it really is that way.

but maybe eventually disney might get those rights when they re negotiate the contract. So probably more like 25 years.

 

[rteetz]

He definitely has set Disney up on the film side of things! Building a legacy kind of like Eisner's. Eisner did more with the parks than Iger so far but he also brought back Disney animation studios to glory days. Looks like both have sent Disney in the right direction when it comes to films.

Yes Iger has done great things for the films but he has also done great things for disneys gaming department. Disney infinity has been very good for them. Also disney had the top app according to apple of the year. As for the parks Iger redid DCA and it's been successful since that redo. Over seas especially in china they have been making a ton of money thats why they are building disney shanghai and the worlds largest disney store in china. China is the best market for disney to invest in at this moment.

 

[DC7800]

but maybe eventually disney might get those rights when they re negotiate the contract. So probably more like 25 years.

There is no need to renegotiate a contract which has no end date. Universal has the Marvel rights locked up.

 

[beer dave]

There is no need to renegotiate a contract which has no end date. Universal has the Marvel rights locked up.

What if Disney develops " new" or "currently unused" characters-- as it seems they are from this article-- Would they not then have the rights to insert them in the parks? All they need to do is go with the spin offs, create new characters people will love. I believe they could also alter the appearance of the current characters being used at universal to a small extent, making universals images look dated and stale. Isn't this already happening?

 

[DanBoris]

There is no need to renegotiate a contract which has no end date. Universal has the Marvel rights locked up.

Correct. And considering the condition Marvel was in when this contract was made in 1999 (still 3 years before the first Spiderman movie and the start of a string of successful movies) the terms are probably very favorable for Uni so they have little incentive to re-negotiate.

What if Disney develops " new" or "currently unused" characters-- as it seems they are from this article-- Would they not then have the rights to insert them in the parks? All they need to do is go with the spin offs, create new characters people will love. I believe they could also alter the appearance of the current characters being used at universal to a small extent, making universals images look dated and stale. Isn't this already happening?

This is possible, but when was the last time Marvel created a character that has become truely iconic to the general public? Probably been a long time. If they are developing a new character totally from scratch there is no need to connect that to Marvel, they could just do that independently. Now it does appear the Disney is trying to exploit some of the lesser know characters with the Big Hero Six, Guardians of the Galaxy and Ant Man movies, but it is yet to be seen how the general public will except these.

 

[Yellowstonetim]

The Pixar, Marvel and Lucas film acquisitions really are going to be Iger's legacy. He has set Disney up for decades of success.

He definitely has set Disney up on the film side of things! Building a legacy kind of like Eisner's. Eisner did more with the parks than Iger so far but he also brought back Disney animation studios to glory days. Looks like both have sent Disney in the right direction when it comes to films.

What if Disney develops " new" or "currently unused" characters-- as it seems they are from this article-- Would they not then have the rights to insert them in the parks? All they need to do is go with the spin offs, create new characters people will love. I believe they could also alter the appearance of the current characters being used at universal to a small extent, making universals images look dated and stale. Isn't this already happening?

Correct. And considering the condition Marvel was in when this contract was made in 1999 (still 3 years before the first Spiderman movie and the start of a string of successful movies) the terms are probably very favorable for Uni so they have little incentive to re-negotiate.

This is possible, but when was the last time Marvel created a character that has become truely iconic to the general public? Probably been a long time. If they are developing a new character totally from scratch there is no need to connect that to Marvel, they could just do that independently. Now it does appear the Disney is trying to exploit some of the lesser know characters with the Big Hero Six, Guardians of the Galaxy and Ant Man movies, but it is yet to be seen how the general public will except these.

As I understand it, Universal has only the characters they are now using in the parks, they do not have Iron Man. And they only have those characters in a certain geographic area. I don't remember how far that is but it isn't beyond the Americas. Marvel could very well create new characters and they would become successful because Disney now owns and can market those characters in a hundred different ways.

Disney has bought the best possible properties and the future looks good!

 

[rteetz]

As I understand it, Universal has only the characters they are now using in the parks, they do not have Iron Man. And they only have those characters in a certain geographic area. I don't remember how far that is but it isn't beyond the Americas. Marvel could very well create new characters and they would become successful because Disney now owns and can market those characters in a hundred different ways. Disney has bought the best possible properties and the future looks good!

But disney still can't put iron man in WDW. They did a monorail wrap and that could only be on the resorts line it could not be on the Epcot line.

 

[Polydweller]

But disney still can't put iron man in WDW. They did a monorail wrap and that could only be on the resorts line it could not be on the Epcot line.

Yep, and Iron Man is part of the Avengers group as is the Hulk. The Hulk Coaster at Uni alone rules out any of the Avengers group according to contract.

Disney won't be getting anything Marvel at WDW because of that kind of affiliation.

 

[beer dave]

As I understand it, Universal has only the characters they are now using in the parks, they do not have Iron Man. And they only have those characters in a certain geographic area. I don't remember how far that is but it isn't beyond the Americas. Marvel could very well create new characters and they would become successful because Disney now owns and can market those characters in a hundred different ways.

Disney has bought the best possible properties and the future looks good!

Fairly sure it's east of the mississippi.

 

[DanBoris]

Fairly sure it's east of the mississippi.

Correct. Section IV.A.1.a.1.i:

East of The Mississippi - any other theme park is limited to using characters not currently being used by MCA at the time such other license is granted. [For purpose of this subsection and subsection iv, a character is “being used by MCA” if (x) it or another character of the same “family” (e.g., any member of THE FANTASTIC FOUR, THE AVENGERS or villains associated with a hero being used) is more than an incidental element of an attraction, is presented as a costumed character, or is more than an incidental element of the theming of a retail store or food facility; and, (y) in addition, if such character or another character from the same “family” is an element in any MCA marketing during the previous year. Any character who is only used as a costume character will not be considered to be “being used by MCA” unless it appears as more than an incidental element in MCA’s marketing.]

 

[r3d]

A nice little article for investors who may not be hardcore Disney fans. One of the many reasons I reduced my holdings in Comcast and brought it over to Disney. Safer investment which has proven to grow just as well.

There's my invest in Disney propaganda for the week

 

[Joben]

so Disney just needs to build a Marvel park just west of the Mississippi, like around Saint Louis or even by Marceline MO. WDW was originally going to be in Saint Louis, until the Budweiser Co found out Walt didn't want alcohol in his park, then the city put the nix on that plan and Walt moved to FL. Though realistically the weather would not allow for a year round park. But It seems like a good idea to have a park on each coast and in the middle.

 

[rteetz]

so Disney just needs to build a Marvel park just west of the Mississippi, like around Saint Louis or even by Marceline MO. WDW was originally going to be in Saint Louis, until the Budweiser Co found out Walt didn't want alcohol in his park, then the city put the nix on that plan and Walt moved to FL. Though realistically the weather would not allow for a year round park. But It seems like a good idea to have a park on each coast and in the middle.

good idea but I don't think it will happen in my life time. I think disney now realizes the year round aspect and I don't think they would build another park in an area in such a place that can't do year round, unless you have a ski resort on property or something it's just not going to happen.