All Things Disney

Bob Iger and the Publishing Industry?

noreply@blogger.com (Michael) — Fri, 11 Dec 2009 03:22:00 +0000

I read with interest the announcement earlier this week that Condé Nast, Hearst, Meredith, News Corporation and Time Inc. jointly announced an independent venture to develop open standards for a new digital storefront and related technology that will allow consumers to enjoy their favorite media content on portable digital devices. That story made me think almost immediately of the ideas of consumer consumption habits of media that Bob Iger has been talking about lately, the most recent being the discussion of the technology called ‘keychest’.

What made me think of Disney? Probably the quote statement in the press release:

“For the consumer, this digital initiative will provide access to an extraordinary selection of engaging content products, all customized for easy download on the device of their choice, including smartphones, e-readers and laptops,” explained John Squires, the venture’s interim managing director. “Once purchased, this content will be ‘unlocked’ for consumers to enjoy anywhere, anytime, on any platform.”

And here is how The Financial Times described Keychest:

Next month Disney plans to unveil Keychest, a new technology that will allow digital copies of films to be stored remotely and then viewed and moved across platforms, such as smartphones, or games consoles such as Microsoft's Xbox.

I’m not suggesting that they are in collusion in any way of course, just that in many ways two very different forms of media (print and movie entertainment) are converging to a very similar set of realizations it seems.

In the print case people are increasingly turning to digital media vice that traditional printed versions and socking it too newspaper and print magazines left and right. In the movie case people are ‘waiting for it on video’ and then in many cases are weary to forklift upgrade video collections from ‘good enough’ DVD to hi-rez formats like Blu-Ray (after all, how many portable devices can output Blu-Ray quality pics? Certainly nothing that the fruit company makes, among many many others).

It’s the whole CD to MP3 collection fatigue all over again. I switched to AAC because it had better quality than MP3 for the same file size, but even after over half of a decade of Apple dominance, the number of portable playback devices that work with AAC despite very competitive licensing rates can be counted on your fingers. I’m stuck, and it stinks.

And people, as Bob Iger has noted, think it stinks when they have to pay to watch a movie they bought on every device they own that’s different. And so you know what they do? Nothing. They buy the DVD, and they do nothing frankly beyond that in general. Us tech savy guys can buy software to rip it and remove the copy protection for a variety of devices (legally I might add), but my Dad nor my in-laws are interested in the least.

So it will be interesting to see if anybody else in the movie industry signs on to a deal like the publishing guys just did. It probably won’t be Keychest (I view that as more of a downpayment on Bob’s ideas that a technology they truly believe will be the standard at this point). but change is coming…

Lengthy Interview with Roy E. Disney

noreply@blogger.com (Michael) — Mon, 30 Nov 2009 23:02:00 +0000

Didier Ghez pointed over at his Disney History blog today to a very lengthy (and high quality) interview with Roy E. Disney, son of Roy O. and nephew of Walt. The link from his blog takes you to the Archive of American Television, which has a very nice layout with background information, a 6 part taped interview along with notes and an outline.

The actual videos themselves are on YouTube in HD and all 6 parts run about 3 hours and 45 minutes. The AAT website says, ‘The interview was conducted by Jennifer Howard on November 5, 2007’.

I recommend you check out the AAT website, but here are the videos if you want to watch them back to back without a lot of fuss. :)

Sorry for the right edge bleedover, but I didn’t want to mess with the aspect ratio. You can actually see these on the YouTube website in HD directly.

Mickey in Florida still lagging on booking window?

noreply@blogger.com (Michael) — Sun, 22 Nov 2009 22:21:00 +0000

Of course it’s no surprise that Disney’s theme park’s continue to under-perform due to the economy. What I didn’t expect was that they’d be sending out incentives for what is normally their busiest week of the year: Christmas to New Years.

Back in the 80’s when it was just the Magic Kingdom and EPCOT, that week was dead. We used to go all of the time and the parks were pretty quiet. As long as you were out by the 31st, which was when central Florida college bowls games kicked in, you were golden. Now it’s the busiest time of the year; garnering holiday room rates, higher meal prices via surcharges, and a variety of extra money making deals for Mickey and crew.

But it looks like that won’t be the case this year. Mickey is sending out offers this late 30% off at select Deluxe hotels. I’m sure that the value and moderates are probably packed to the gills however. I’ve seen quiet a few offers this year for the Deluxe resorts, which isn’t a large surprise. It does make me wonder how all of the other luxury offerings that are doing up around WDW are doing?

The other downside of course is that people who spend $300+ a night for a hotel tend to spend MORE money both in the hotel and in the parks, whereas people in moderates and values probably tend to spend less. That’s not looking good for increasing those ‘per cap’ park and room spending numbers that were off 10% and 7% respectively.

Regardless of room occupancy and deals, given our experience at the last holiday week we went we won’t be going back this year for it either.

Here is the offer I got in my inbox earlier this week:

Last-Minute Magic!

Get 30% off Disney Deluxe Resorts for stays most nights Dec. 25, 2009 through Jan. 2, 2010.

Imagine spending one of the most festive weeks of the year in grand style at a Disney Deluxe Resort—at 30% off!
Make this holiday season your family's most magical ever. Call now, the number of rooms available at this special rate is limited.

Minimum length-of-stay requirements may apply for Friday or Saturday arrivals. Savings based on non-discounted price for the same room. Additional per-adult charges apply if more than two adults per room. No group rates or other discounts apply. Offer is nontransferable.

Call 407 939-5696 or your Travel Agent today!
Be sure to mention your PIN: XXXXX XXXXX XXXX
Ask about other Disney Resort categories that may be available when you call!

End of Year Telcon for Disney

noreply@blogger.com (Michael) — Sat, 14 Nov 2009 17:35:00 +0000

Sorry it’s been a bit since I posted anything. No, I’m not dead. LoL. Just been very busy (and a little TOO addicted lately to this).

So here is the blow by blow of this quarter’s conference call.

Of course, the lead off story was about the early morning announcement of the unusual swap of Tom Staggs and Jay Rasulo. (Ed: It’s also possibly a shrewd move on Bob Iger’s part to keep two high profile executives inside the Disney fold, since with the slowly improving economy either would be natural targets to lure away. It also gives both of them a chance to broaden their base for a CEO shot sometime in the future).

Bob Iger opening comments:

Chinese last week gave permission for park in Shanghai. Looking forward to building a ‘world class resort’ experience.
Working toward closing of Marvel deal.
Studio had a BAD year due to performance of live action slate (Ed: 5 quarters of losses, which is probably the main reason why they let Dick Cook go). Also see challenges to overall motion picture model. Expect a tighter focus on costs of production, marketing and distribution. Expect more challenges from Disney to the status quo as the distribution mediums for content expand.
See Disney, PIXAR and Marvel now as covering a wider array of family entertainment.
Will continue to invest in franchise properties in each of these studios such as Princess and The Frog, Cars 2, and Pirates 4.
Parks and Resorts continues to expand at DCA, HK Disneyland, Cruise Line, etc.
ABC off to a good start with the fall lineup.
ABC Family continues to grow and gain viewership.
Disney Channel at all time high in ratings, and XD channel has been very successful in US. Overseas expansion also continues to drive Disney Channel subscriptions.
ESPN, in its 30th year, posted its largest ever audience numbers in the 4th quarter.

Tom Staggs financial highlights:

ESPN operating income up, much of it because of an extra week in the quarter and a 1 time recognition of additional deferred revenue.
ESPN add sales were flat, but because of the extra week were likely down about 3%.
Broadcasting improved on higher sale of shows, but relied on the extra week to overcome weaker ratings demands.
Q4 add revenue, excluding extra week, at affiliates was off about 15% but seems to be firming.
Q1 upfront pricing for advertising is running higher and Q2 option pickups are the highest in 10 years.
Studio had another bad quarter forcing movie right downs as well as some losses in the music side.
2010 studio slate is full however.
Consumer Products had a 20% decline in licensing due to the lag in how long it takes a downturn in the economy to ripple through the production of licensed products.
Parks and Resorts domestic attendance were up 10% due to extra week and solid response to promotional offers.
Combined attendance without the extra week was up about 3% with a 15% increase at DL offsetting a 3% decline at WDW.
WDW occupancy for the quarter was 84%, 5% under the prior year, Disneyland was also at 84% occupancy (4% lower).
Per cap spending at parks off 10% and per room spending was off 7%.
Q1 bookings are running about 5% behind last year.
New offers have increased the booking rate in recent weeks.
Pension and health care expenses will increase dramatically this year.
Strong cash flow and tight control on cash expenses have allowed the company to weather the year.
First priority for new spending is on increasing the slate of available opportunities that have attractive returns.
This includes investment in programming, movies, and video games.
Purchased only a modest number of shares in Q4, expecting to increase that throughout the year as they believe the current stock price is still at an attractive price.

Question highlights:

No further information is forthcoming in the short term from Disney or the Chinese on the Shanghai park until the deal is formally done.
Bob sees the largest opportunity for revenue growth in FY’10 in advertising. Continue to perform for the next year as if the economy will not improve.
Tom also mentioned that almost everybody in company got no salary increase in FY’09.
Current discount is a slightly less costly (and therefore slightly less advantageous) than the previous offers this year.
Bob sees the ‘Keychest’ initiative as a consumer focused technology that will allow the consumer to essentially ‘buy once, consume in many places without having to repay’. Of course, expect that ‘keychest’ enabled content will be able to garner a higher price than a use on only one device type of purchase.
On the Dreamworks distribution deal, probably will be very little impact in 2010. Possibly one film in 2010, but probably more likely in 2011.

The question session was longer than this of course, but not a lot of other unique discussion there.

Affiliated Computer Services to be bought by Xerox

noreply@blogger.com (Michael) — Tue, 29 Sep 2009 20:02:00 +0000

You many wonder what in the heck that title has to do with Disney and a blog named ‘All Things Disney’… but then again, if you’ve found my little blog on the internet then you are, my friend, not your NORMAL Disneyana fan. No?!

And given that premise you’d know then that I wouldn’t suggest something unless it was related, and of course you’d be correct…

Far strung throughout the Disney empire is a highly technical shop. They make all kinds of things happen that bring people together, work tirelessly behind the scenes to make sure things are running smoothly and that everybody has a good time (or is being productive). Who might that be you say? Imagineering? Parks and Resorts folks? Neh, I say… it’s really none other than Disney IT!

See not all that long ago, or so the story I’ve been told goes, Disney let each of the BU’s (that’s business units in management speak) run their own IT operations. Each BU was like it’s own little ‘kingdom’ shall we say, to abuse a metaphor given the subject.

But for a company the size of Disney that’s not always the most efficient or effective way to manage your resources. So they began to coordinate the IT centers inside each of the BU’s. Michael Eisner also named Michael Tasooji the first Disney CIO in 2000. Michael stayed on until leaving Disney in 2003 for The Gap Inc., and just recently left there according to LinkedIn to start his own company Digital Innovation Technology.

Frankly it’s not exactly clear what happened next from the outside, but given the turmoil in the company at the time, it’s probably safe to assume that the official CIO job went empty until Disney hired Tony Scott from GM (yes, THAT GM) in early 2005.

A lot of stuff was made out of Tony’s GM days, but the REAL answer was in his previous years at the drug maker Bristol-Meyers Squibb. A speaking profile says this is where he ‘led the transformation of their technology infrastructure organization to a shared services model and the development of a corporate infrastructure to support implementation of SAP and web-based technologies.’

And that’s where ACS comes in. Yep, you knew we’d get there eventually no?

In June of 2005 Disney announced that they were outsourcing almost all of their IT services. And guess you’ve figured out by now who won? ACS of course. At the time the contract was for 7 years and approx. $610 million.

Tony (and probably some others as well) also brought with them from those drug industry days a passion for IT services management. Today the most widely known standard here is the Information Technology Infrastructure Library (or ITIL) which was published in 2006 under v2 and more recently in v3. Which of course is how Disney now operates most of their outsourced IT services as well (ITIL that is), including the contract under which ACS operates.

Disney also has other outsourced IT services contracts covering other parts of their infrastructure requirements. Where ACS does the ‘services’ side of the offering for instance, HP does all the print services. Cell phone, land lines, etc. etc. etc… all come under the umbrella at some point of Disney IT.

Tony left Disney in 2008 to go work for Bill as his CIO. And in May of 2008 Bob Iger and crew appointed Susan O’Day, the current CIO of Disney to her current position. It’s probably little wonder by the way, that Susan also came from the drug industry, where she also spent 12 years at a little drug company named: Bristol-Meyers Squibb.

So there is how today’s $5.7 billion offer for Dallas based ACS by the Norwalk, CT based Xerox affects the world of ‘all things Disney’.

Disney Cruise Line goes on media blitz!

noreply@blogger.com (Michael) — Sun, 20 Sep 2009 13:59:00 +0000

Starting on September 11, 2009, Disney seems to have quietly updated their cruise line loyalty program that goes by the name of Castaway Club.

On that day they program split into 3 tiers: silver, gold and platinum. I’m surprised that they didn’t talk about this at the D23 presentation I went to last week, but here are the facts about the tiers:

	Silver Castaway Begins after your 1st completed cruise.	Gold Castaway Begins after your 5th completed cruise.	Platinum Castaway Begins after your 10th completed cruise.
Castaway Club Benefits at a Glance
AT-HOME BENEFITS
Insider Exclusives Just for members—Webcasts, info, tips and news.	•	•	•
Early Access to Online Activity Planning Advance booking for onboard amenities and shore excursions.	90 days prior to sailing	105 days prior to sailing	120 days prior to sailing
Dedicated Phone Number (800) 449-3380—your direct line for info and assistance.	•	•	•
Early Booking Opportunities Be among the first to book our newest itineraries and ships 7 days before the general public.		•	•
ONBOARD BENEFITS
Exclusive Cruise Terminal Check-In Sail through the boarding process in a separate, members-only line.	•	•	•
Welcome Back Stateroom Gift* Be welcomed back with a gift unique to your membership level.	•	•	•
Special Onboard Booking Offer While on board, enjoy special savings on future cruises.	•	•	•
Castaway Club Onboard Reception Meet and mingle with the ship's officers at a private party on voyages 4-nights and longer.		•	•
Special Merchandise Offering Take advantage of special onboard shopping opportunities.		•	•
Priority Check-In at Cruise Terminal Enjoy concierge priority boarding check-in at the cruise terminal.			•
Exclusive Platinum Experiences** Unforgettable Disney fun created just for Platinum members.			•
Complimentary Dinner at Palo*** Savor an elegant dinner at Palo, on us.			•

* One gift per stateroom based on highest level Castaway Club member in stateroom.
** Exclusive Platinum experiences are subject to change without notice.
*** Offer includes dining service fee ($15) for one dinner. Available to Platinum Castaway member and Guests staying in member's stateroom. Must be 18 years of age or older.

Additionally there will be a live broadcast online from New York City on October 29, at 4:15 PM with more details about the new Disney Dream ship currently under construction at Meyer Werft in Papenburg, Germany. Appears that it will be broadcast through the Disney Cruise website.

And lastly, Disney will unveil a new 6 story tall Sailor Mickey balloon at this years Macy’s Thanksgiving Day parade.

I’ll try to have some more D23 stuff up soon!

Disney Cruise Line announcements at D23

noreply@blogger.com (Michael) — Wed, 16 Sep 2009 02:23:00 +0000

We were on hand to see the Disney Cruise Line presentation on Friday morning. Of course the big announcement was that when the Disney Wonder moves permanently to the west coast in 2011, that DCL WILL be making cruises to Alaska despite previous rumor to the contrary.

They just won’t be making any of them to Glacier Bay. Instead the Wonder will leave from the port of Vancouver, BC and sail the waters of the southern Alaskan including Juneau, Ketchikan and Skagway. The full press release in case you missed it is here.

The interesting thing about the press release is that is has MORE data than was actually given in the presentation! The Wonder is going into drydock in October for an undisclosed period, but the press release DOES mention that they will be adding a new dining option on Deck 10 called Outlook Café, which will connect to the Cove Café immediately below, which is the coffee/cigar/whiskey bar in the adults only area. No pictures were given, but I take this to mean that they’ll be adding a new glassed in area on the upper deck (Deck 10) that will either take the place of the teen hang out in ‘the stack’ or wrap around the stack in some fashion to provide the vista views promised.

Only two real disappointments in this presentation I thought.

The first was that we waited in line almost an hour for what was support to be a 60 minute discussion. We thought we’d get a few announcements and maybe some discussion about the cruise line, the new ships, how the cruise line business works, etc. etc. What we got instead was a 30 minute very nicely put together marketing blitz that while intimate in size (only 198 people were let in the room that the day before had held over twice that many for the Imagineering discussion), wasn’t so intimate in presentation.

The second was that almost NOTHING was said about what was going to be going on with the new Disney Dream. It’s suppose to report on duty in 2011 so that the Wonder can leave for the west coast and presumably so that the Magic can leave again for Europe. The only announcement really was what the statue would be (that of Admiral Donald).

Not much else to share with you on that front, though they did have a model in the Imagineering area. Here are a couple of shots showing the front and back of the new ship (they didn’t stitch together very well of the overall length).

So we’ll have to wait until later to hear more…

All pictures in this post are copyright The Walt Disney Company.

More D23

noreply@blogger.com (Michael) — Sun, 13 Sep 2009 07:27:00 +0000

Here are a couple of nice panoramic photos I stitched together from D23. It’s been a BUSY day, with the crowd more than tripling on Day 3 and the lines have been VERY VERY long.

Here is a picture of the Expo Hall in the center, just to give you an idea of how big it is. This is ONE of three areas and the main entry area. To my left is much of the area of pictures I posted yesterday with Consumer Products and Disneyana. To my right is the Dream Store.

And behind me is this:

Which is the Imagineering area.

Inside are things like the following…

The first are several models of the new Cars Land area coming to DCA. Below you can see two panoramas I stitched together of the same model, which as you can tell is quite large!

Next is the Animatronics area.

Which has a small area at the end which is where Wall*E and Lucky have been performing.

The next area has a model of the new Disney Dream cruise ship, which I have to retake pictures of before I can post them as well as a large model of the new Hawaii DVC.

And of course last are the models and markups for the new expansions coming to Hong Kong Disneyland. Here is a panoramic picture of the model:

More to come!

Greetings from D23!

noreply@blogger.com (Michael) — Sat, 12 Sep 2009 05:56:00 +0000

Yep, I’m out here on the west coast along with a group of ‘dyed-in-the-wool’ Disney fans to take in Disney’s first, modern attempt to a build a sanctioned/official fan community. We are just getting over with day 2 (and boy, was it a full day). I didn’t get to post anything last night about day 1 due to some technical issues, but I’ll cover that in this installment as well.

Nothing much to especially mention from our trip a couple of weeks ago to WDW. The park is still running, the hours are still being adjusted more or less on the fly as required, crowds seemed to be good, if a bit spotty, and as is typical this time of the year: IT WAS HOT! So hot, we took 2-3 hour off every afternoon to leave the parks and seek Starbucks and A/C while letting the little one take in a nap.

BTW, up front, if you hear of something you don’t think is being covered at D23, drop me a line at michael@allthingsdiz.com and I’ll try to follow up before the event ends Sunday night.

So first, the general overall impressions after 2 days of go-go-go and in no particular order.

The Anaheim Convention Center has in general done a good job of ‘swallowing’ the crowd yesterday and today, though I’d say Friday was bigger than Thursday which makes sense given that more locals turned out today than yesterday. It’s hard to get a firm idea of how tickets are working since the only way to know is by the color of wristbands and even then they have two different versions of some colors: one for D23 members and one without.

That’s not to say that there haven’t been some minor growing pains with crowds and lines. Several of the more popular seminars have had lines where the wait has been in excess of 40-50 minutes and lines much longer than the venue could hold. On day 1 some of the lines were so long we ended up only seeing one seminar due to the distance between venues (it’s a fairly large center after all).

Disney has done good by their goal of including the broader Disneyana community in the convention as well (though I’m sure they probably ‘paid’ for the honor of being part of the Expo as would be typical of a convention). Many of the more popularly known Disney related fan sites are represented in person on the Expo floor, which I’ll cover below. Many of the panels have also been hosted by folks who are either retired from the company or from the broader Disneyana community as well. For instance, the panel on the new art documentary ‘El Group’ was hosted by none other than Jim Hill of Jim Hill Media.

Likewise, I have to give big props to Disney in terms of general production value. So far there have been lots of surprises (good kinds) and overall fairly well produced (and scripted) larger and even many of the smaller settings. There are some things to smooth out in the future, but overall this thing has gone off very well so far.

I also have to believe from what I’ve seen that it’s very true that D23 has the support of the top folks at the company as shown by the tons of people that have shown up from the company. I’ve seen Tony Baxter more than once in the halls for instance, as well as tons of salaried cast members just to point out a couple instances.

EXPO

The Expo certainly takes up the largest part of the overall venue and most of the first floor. The main areas of course surround the major elements of the overall company, and most of the consumer facing parts are well represented. The Disney Consumer Products are also has Disney sanctioned licenses like Lego, Hasbro and Hallmark. There is also a fairly large store for D23 stuff as you’d expect, though much of the ‘unique’ D23 stuff is actually available only through the disneystore.com website. They have demo items to see of those, but you can’t actually buy them here.

Here are some photos from the Disney and Disney sponsored areas:

And here are just a couple from the Disneyana area:

Day 1

We were a little late in getting here yesterday due to other work commitments, so I missed the Bob Iger keynote in the morning as well as the latest Legends induction ceremony. No doubt you’ve seen the pictures of the distinguished list of individuals inducted this year and everybody said Bob did a good job with both his presentation and his MC duties. No major announcements during that keynote that I heard or that I’ve read, just good solid discussions and about 30 minutes of the upcoming ‘Princess and the Frog’.

We did manage to make it to the Imagineering Legends discussion which was good, with that slightly irreverent fun you get when you get these guys together.

Marty Sklar and Bob Gurr joshed with each other (Marty saying they were still in an ongoing debate from the early 80’s over whether Bob quit or Marty fired him. *laughs*), while Don Iwerks and Alice Davis had some great stories. Blaine Gibson had a couple good stories too add too. And of course you can’t have a good meeting like this without a straight man, which was more than taken care of by X. Atencio!

I’ll try to get some Day 2 stuff up tomorrow.

Headed to the World

noreply@blogger.com (Michael) — Wed, 26 Aug 2009 22:51:00 +0000

A quick separate post to let you know I’ll be leaving for ‘the World’ tomorrow night for a quick pre-labor day trip. $48 discounted rooms at a Value resort were just too hard to pass up… Disney knows how to ply the weakness in this family with PIN offers!

If there is anything you’ve recently noted or were interested to find out more about, let me know and I’ll do my best to look into it and post next week when we return.

Are you going to D23?

noreply@blogger.com (Michael) — Wed, 26 Aug 2009 22:29:00 +0000

Sorry it’s been a bit since my last post, things have been a whorl wind around here with the end of summer school (and my final class in my MBA thank you very much!) and work. Yeah, I have a ‘boring’ day job too… so this site takes a back seat to that when things are hoppin’ at work like they have been. It doesn’t hurt that things around Disney have been quiet as we expected with the exception of the recent string of unfortunate accidents. Are prayers go out to those who’ve recently lost a loved one at Disney.

The fun news this month has been the build up to D23 of course, which I’m happy to report I (along with a friend and former Disney employee) will be attending. Just today in fact it appears that Disney has begun issuing the online tickets for the Expo.

Here is a peek at what they’ve sent to those of us to date:

Dear E-Ticket holder,

Attached please find a PDF of your E-Ticket(s) to the D23 Expo. Please save this PDF to your computer and PRINT ALL necessary tickets. If you ordered multiple tickets, you MUST PRINT OUT each individual ticket. You will need to redeem your E-Ticket in the main lobby of the Anaheim Convention Center on the date of your confirmed attendance. Please make note of the Expo Hours listed below.

Parking: Parking is available at the Anaheim Convention Center for $12 a day. Per Anaheim Convention Center policy, no special or complimentary parking rates will be offered to Annual Passholders at any of the lots, including overflow lots, for this event.

Shuttles: The Anaheim Resort Transit will operate buses to and from the Anaheim Convention Center. Please check their schedule (www.rideart.org) for times and pick up/drop off locations.

Hours: Ticketing will begin at 7 a.m. each day of the Expo. The show floor will open at 8 a.m. for D23 Members and 9 a.m. for the general public. The show floor will close at 5 p.m, with additional programming at the Expo theaters continuing throughout the evening.

Line Formation: No on property line ups will be allowed at the Anaheim Convention Center prior to 5 am.

For additional information please visit www.D23Expo.com.

We look forward to seeing you at the Expo!

The box in the bottom right has my name, a bar code and the length of the pass (a 4 day in my case).

Disney did a great job with the Expo website and the links through to hotels in the area of the convention center as well. Bravo on that. we’ll be staying literally right across the street from the convention center, so it should be fun!

Somebody can’t count

noreply@blogger.com (Michael) — Sun, 09 Aug 2009 20:27:00 +0000

You saw this all over the Disney related web on Friday:

Disney hotel workers reject contract proposal by 92 percent

When put that way it sounds like a resounding defeat for the Disney folks and a great triumph for the democracy of the Union.

Until you read the article a little closer… Here is the excerpt:

Exactly 1,079 of the current 2,100 rank-and-file union members that wash dishes, clean rooms and wait tables at the three Disney-owned hotels in the resort voted on the contract proposal at the Disneyland Hotel, said Unite Here 11 President Tom Walsh.

So read that closely: what it really says is 92% of the 51.38% of the 2,100 union members who did vote, didn’t vote for the current proposal.

The Union did have a simple majority (as defined by more than 50%), but not a super majority (typically 75%). What is required is probably set by the Union in accordance with the Union’s charter and rules.

I’m all for the Union doing it’s best to defend and improve the lives of its members. I come from a mid-west pro-union family myself. The Union has the right to negotiate on behalf of its workers to make sure they get the best benefit from working for Disney that they can. Disney on the other hand of course has the right to want to control costs and keep this contract in line with other contracts, etc. etc.

What I’m not for are one sided discussions when the facts in the rest of the article don’t support the title.

Richard Petty Driving Experience Heats up!

noreply@blogger.com (Michael) — Sun, 09 Aug 2009 15:32:00 +0000

Somewhere recently on a blog or website that I didn’t make a specific note of there was a discussion about the Richard Petty Driving Experience folks deciding to try and drive more folks to their crown jewel racing experience at the WDW raceway.

It looks like some of that is starting to roll out. Last week on Friday and Saturday for instance you could have booked the Rookie Experience for 43% off the list price.

Next up right now as far as announcements are concerned is the race for the ‘King Cup’.

You can find out more here.

More DVC in the News

noreply@blogger.com (Michael) — Fri, 07 Aug 2009 01:41:00 +0000

Seems my post just a couple of days ago about how DVC adds to the room mix at WDW was timely indeed. At least in the sense that I mentioned in some detail how Disney treats DVC units in counts of occupancy and per room guest spending.

Here is what I had to say:

‘So while in general DVC units would be treated somewhat differently since they are ‘ownership’ shares, that apparently mostly applies to revenue recognition for when the contracts are sold (and again when they are re-sold on the secondary market as part of a package of mortgages much like what got the rest of the real estate into a mess in the first place). Tom Staggs has mentioned a few times over the last couple of years that Disney has had some delayed revenue recognition because they’ve been having to hold onto those contracts longer than normal. Disney collects transaction costs and presumably some upfront money when a contract is sold, but can’t recognize the rest of it until it has a fair price, which is whatever a bond holder will pay for it in the secondary market.’

I say timely because Jason Garcia of the Orlando Sentinel just wrote an interesting piece (and a pretty good one I might add) on just the thing we were noting above about Disney’s issues over the last year or better with having to hold onto DVC contracts longer than normal.

So lets talk just a bit about how this all works, in general terms anyhow. Disney, under the Disney Vacation Club subsidiary, offers to sell you and I an ownership interest in one of their properties. For $98 a point (after discounts), Disney offers to sell you a contract good for 160 points for 50 years. That means the cost is about $15,680. Disney offers you a 10 year mortgage with a 10% down payment at a prevailing interest rate, you sign the paperwork and out the door you go. The proud owner of a deeded share of a nice resort complex in Florida at your favorite place to vacation! You pay the yearly maintenance dues to help pay the operating expenses of your nice place, make your monthly mortgage payment, and enjoy your DVC membership for years to come.

Inside the DVC however, all is not so peaceful! Disney probably takes part of your upfront payment for general sales and administrative expense (after all, someone has to pay all those people in the parks and in the DVC center selling you the property, and usually that’s born by the acquirer at the point of sale). So they record money in at $15,680 times all the other contracts for the quarter, subtract expenses and then have the underlying mortgage and 10 years of interest payments to look forward too. At 10%+, it’s decent money, as long as you pay on time.

The problem is of course that all of the mortgages weigh down Disney’s balance sheet overtime as they accumulate, and Disney would rather have your money now instead of over the next 10 years where depreciation will eat into the return (at 2% growth for inflation, it won’t take long for that 10% to not be worth much in future years). So Disney takes large bundles of these mortgages, wraps them together and sells them to an ‘investor’ like a discounted bond. The investor pays money now for a stream of payments in the future and Disney gets a lump sum payment in year 1 or 2 for the WHOLE contract. Just like Fannie and Freddie do for most of yours and my conventional home mortgages.

That upfront payment is of course risk rated and that affects how much (or little in this case) the investor is willing to pay for the bundle of contracts. The investor bakes in an estimated default rate in what he’s willing to offer so as to try and make sure he stays in the black over the life of the contract, since he now owns it and can loose money. Here that investor was Citi Corp, who you and I as taxpayers now own a large chunk of.

In this case Citi also asked Disney, according to the Sentinel article, as part of the agreement to backstop, or provide the equivalent of insurance, to Citi in the event that more than an expected number of contracts started to default. That would be like that other insurance company that you and I ALSO now own a large part of did for many in the conventional mortgage market, AIG.

In turn, Disney got the right to take back and exchange any deals that were going bad so that they could keep the points inside the system and maintain the overall experience while protecting your ownership interest as well.

You’ve been enjoying your DVC membership for a couple of years and suddenly something happens and your unable to keep up your payments. This isn’t a primary residence, so you don’t qualify for any government assistance to reset or refinance your mortgage. You can try to sell it through an after market reseller, but chances are you will probably have to offer it for less than you owe on it to attract a buyer unless you’ve made substantial principal payments in the last couple of years. You make a tough decision and let the mortgage lapse into default and heading for foreclosure.

Disney has to buy back your contract and swap it and if they can’t then that insurance kicks in and Disney pays Citi a flat rate to essentially payoff your contract. This happens at a higher than projected rate and Citi comes back during a normal contract renegotiation and tells Disney it can no longer honor the terms of the original agreement because its suffering losses far in excess of what it had estimated it would (i.e. they are either not making as much money or they are actually loosing money).

Disney balks at the amount of ‘insurance’ Citi now wants and talks break down. In the meantime Disney keeps selling contracts, but its lost its ability to go for the ‘easy money’ by packaging and selling them and instead now has to service the loans and generate cash from the interest payments. DVC cashflow slows and the Parks and Resorts folks take a cash hit because they are now lugging around all those mortgages they’d have otherwise not had.

So it’s an interesting peak into how the market works.

Adding DVC to the mix

noreply@blogger.com (Michael) — Wed, 05 Aug 2009 00:09:00 +0000

John over at ‘The Disney Blog’ commented about my post from yesterday about attendance at WDW. In his comments he asked if and how I thought DVC affected the occupancy rates, etc. for the parks. John, hope you don’t mind me responding on my blog here instead of in the comments on yours!

I had to go back to the actual 2008 Form 10K that Disney is required to file with the Securities and Exchange Commission to find the answer! This data is more in depth financial analysis data than what Disney publishes in their otherwise very nice Annual Corporate Report. At the end of the day this report is really nothing more than a slickly produced marketing piece and a lot of the real data is in the 10k. Disney isn’t the only one that does that by the way, its general corporate practice.

So the answer is that yes, Disney includes DVC in the hotel statistics. Here is the appropriate excerpt from page 33 of the 10k:

(1) Per room guest spending consists of the average daily hotel room rate as well as guest spending on food, beverages and merchandise at the hotels. Hotel statistics include rentals of Disney Vacation Club units.

There is a nice table there as well that shows that in 2008 Disney had over 8,566,000 available room nights with average per room guest spending of $223.

So while in general DVC units would be treated somewhat differently since they are ‘ownership’ shares, that apparently mostly applies to revenue recognition for when the contracts are sold (and again when they are re-sold on the secondary market as part of a package of mortgages much like what got the rest of the real estate into a mess in the first place). Tom Staggs has mentioned a few times over the last couple of years that Disney has had some delayed revenue recognition because they’ve been having to hold onto those contracts longer than normal. Disney collects transaction costs and presumably some upfront money when a contract is sold, but can’t recognize the rest of it until it has a fair price, which is whatever a bond holder will pay for it in the secondary market.

Direct from the same report on page 13 is what it has to say about the number of DVC rooms:

‘The Disney Vacation Club (DVC) offers ownership interests in eight resort facilities located at the Walt Disney World Resort; Vero Beach, Florida; and Hilton Head Island, South Carolina. Available units at each facility are offered for sale under a vacation ownership plan and are operated as rental property until the units are sold. Disney Vacation Club inventory consists of a mix of units ranging from one bedroom studios to three bedroom villas. Unit counts in this document are presented in terms of two bedroom equivalents. As of September 27, 2008, DVC has approximately 2,300 Units. There are approximately 700 additional Units under construction at the Walt Disney World Resort. These include the second phase of Disney’s Animal Kingdom Villas as well as the recently announced Bay Lake Towers at Disney’s Contemporary Resort and the Treehouse Villas at Disney’s Saratoga Springs Resort and Spa.’

Now we have to parse this carefully to get the full picture… note the second line above that I bolded and underlined. UNSOLD rooms are counted as RENTALS for the sake of the note above about hotel statistics and occupancy rates. NOT all the 2,300 available rooms.

So lets do a little more math. If there are 22,216 rooms in the hotels that times 365 = 8,108,840 available room nights. If we subtract that from the number above on the 10k of 8,566,000 available, we get 457,160 room nights difference. Divide that by 365 gives us about 1,252 rooms available for rent (i.e. you and I can book them outside DVC) on average across the year. That means about half of the DVC rooms are open on average at any point in the year for the general public.

Now add that to the 22,216 rooms I quoted yesterday (Disney’s 10k says they have approximately 22,000 so we are close!), and we get about 23,468 rooms in ‘two bedroom’ equivalents. (I could have also gotten this number directly by dividing 8,566,000 by 365, but it wouldn’t have told me the number of rooms open for rent in the DVC resorts!).

That means that DVC rooms are about 5% of the total rooms available at any given time. Since most DVC’s price at the Deluxe resort rate, this would make my table from yesterday look like:

8,324 Value Rooms (about 36% of the total)
7,089 Moderate Rooms (about 30% of the total)
8,055 Deluxe Rooms (about 34% of the total)

To get 90% occupancy using yesterday’s assumptions of near 100% in the value resort (36%), high in the moderates (28%), then the new Deluxe number would be 26% which is a Deluxe occupancy of about 76% or 6,159 rooms every day of the year on average. The numbers are a little hard to compare to yesterday since all of the percentages shifted, but the additional DVC rooms means that Disney has to sell about 1,127 more Deluxe rooms on average than I said yesterday to maintain a 90% occupancy.

So all of that is to say that if you own a DVC contract and stay at Disney World you don’t count in the occupancy numbers directly, just in the total number of nights rooms were open to the general public. My guess is also that many DVC members are season pass members, so as I noted yesterday, it’s not clear how AP members affect gate count from the info Disney provides in any of their reports.

Which attendance numbers are right?

noreply@blogger.com (Michael) — Mon, 03 Aug 2009 22:38:00 +0000

Chris, a reader here at allthingsdiz.com, posed the following question in the comments section of my recent post on the 3rd Quarter Conference Call highlights post:

‘What do you think about reports that attendance is really down for summer? True? I've only heard this anecdotally, but it seems to be coming from lots of sources.’

I started to answer Chris in a response comment, but my thoughts got so big I decided to turn it into a post so we don’t get lost in the Comments part of the blog!

---------------------

That's a good question I'm not sure any of us have a good idea about except Disney. I've read many of the same reports presumably as you with pictures, wait times and what not showing a very dead park, especially during the weekdays.

Disney on the other hand says attendance is inline with this time last year in general, the hotel rate utilization is still in the 90+% category and they just raised admission ticket prices. So my bet is that unless Disney is lying to everybody (which I strongly doubt) then demand would appear to still be fairly strong. Bob Iger says he is happy with where things are given the general state of the economy anyhow.

What Disney doesn’t break out for us, though I’m sure they know what the answers are if not literally than at least statistically, is the demographics of the gate count: adults vs. children, type of ticket, discounted tickets, etc. All we get is a pure gate count, so it’s entirely possible that the wait times are down for some of the larger rides due to a shift in the types of people visiting. Maybe more people are coming with younger children and older adults who don’t or can’t ride the thrill rides? I guarantee that the line at Peter Pan is STILL WAY too long (despite FastPass).

The same can be said for the food in the Parks. I read somewhere that someone said recently that they got a walkup to Le Cellier. That fact seems to me to be 2 fold in possible cause. First, it won’t be that way now that free food is in effect. And second, I offer the general observation that park attendance =/ (does not equal) strong dining attendance, especially in the more expensive sit down restaurants when people are on a fixed budget. They do tell us that per guest spending in the parks is down quite a bit from last year, which would seem to be in line with this theory, even though that includes merchandise as well. Those are again only numbers Disney really knows, but they are separate, though possibly correlated, measures.

It will be interesting to see what happens with the late fall free food where they are ‘tiering’ the service based on the hotel your staying at. We probably won’t have any definitive data there either, but if Disney brings it back later, then I’d say that says something.

The other demographic they don’t break out is per resort occupancy, just overall occupancy rates. My guess is that, as usually would be the case, the Value resorts are stuffed to the gills, the camping side of the campground is booked solid, and it’s not until you get into the Moderate and Deluxe resorts that you start to see occupancy drop.

If Wikipedia is right (though we could cross reference with The Unofficial Guide if we really wanted too), then by my calculations there are about 22,216 hotel rooms distributed as follows:

8,324 Value Rooms (about 37% of the total)
7,089 Moderate Rooms (about 32% of the total)
6,803 Deluxe Rooms (about 30% of the total)

That last figure is not counting Shades of Green or Swan/Dolphin, nor any DVC resorts. That means we can get 90% occupancy with all the Value rooms (37%), say most of the Moderate rooms (how about 28%?), which leaves a Deluxe room occupancy of only about 24%. Those are just my guesses of course. We also haven’t touched off site stays, nor Season Pass members.

So overall I’d say that based on Disney’s conference call and Len and Fred’s Crowd Calendar and updates that Disney attendance is still fairly strong. I’d further guess based on the train of thought illustrated here though, that it’s the demographics that have shifted, making for a shift in wait times based on the types of rides people want or are able to ride and the places budget conscious eaters want or can afford to eat.

That’s a long winded answer, and now you know why I made it a post instead of replying in the Comments!

Feel free to expound, add thoughts or what not in the Comments to this post…

3RD Quarter Conference Call

noreply@blogger.com (Michael) — Thu, 30 Jul 2009 21:34:00 +0000

Good news is that Disney is still making money, even though Earnings Per Share (EPS) is off from $1.87 to $1.29 from this time last year. Likewise, Bob and Tom both noted that the economy, and therefore the business, feels like it’s stabilizing. They aren’t ready to call it out of the woods yet or even a return to anything normal, but at least something akin to stable.

Biggest issues still continue to be that people are making financial decisions closer to travel/ad placement, etc., and the overall video sales market continues to essentially be in decline.

You can listen and read the press releases here:

http://corporate.disney.go.com/investors/earnings.html

One downside of course was NO MAJOR announcements, not that we expected any. My guess is Disney is keeping some of those for D23 and then the typical announcements as we move into their new fiscal year in October. That’s the normal mode. Basically, as I’ve expressed in my own opinion before, the day-to-day operations of the company are on auto pilot now. At least for the rest of the summer anyhow, while heavy planning is going on for next fiscal year.

Prepared Remarks

- Studio off a lot, especially home video sales off the most due to weaker slate than last year.

- Summer theatrical slate doing well however

- Q3 licensing off 14% YOY due to generally poor economy

- Interactive Media better

- Ad market improving at media networks, but 26% decline in local markets which are soft

- Slightly lower national ad revenues due to lower program rating

- ESPN off due to timing of revenue

- Increased subscriber rates seen as offsetting slightly lower ad revenue however

- Ad placement window has been getting shorter as well, with buyers waiting to place orders until close to when ads will run

- P&R Promotions attendance UP 3% due to Easter, mostly at Disneyland (up 10%), while Florida was basically flat.

- Overall off about 6% over last year

- Guest spending and overall per room spending also down year over year.

- Room reservations for Q4 are up this year over last, but due to extra week in accounting calendar are actually down 7% year over year

Question Highlights

- P&R still has good margins, where do we see things going over the next several months? Tom doesn’t see much difference to bottom line impact in the Buy 4/Get 3 Free or Free Dining (i.e. costs to Disney for both are about the same). To date almost all costs that have been taken out of the P&R system have been ‘back of house’ and they feel comfortable that most of those costs will stick (my words).

- Tom is feeling good about capital expenditures going forward and is hoping to renew share repurchases as a method for returning capital to investors soon.

- Bob mentioned in one answer that they are very pleased with where Disney XD is going and growth has been strong, though he admits off of a low base of comparison.

- First of new cruise ships will be in service first part of FY 11, which will be about a year from now. The 4th ship will be a year later. Design expected to be shown in the fall… stay tuned.

- Bob feels good about who P&R is attracting, and is happy that many people are getting to come who’ve never come before. He’s confident that they’ll be able to wean the public off of big discounts as the market improves.

- Bob also noted that consumer taste is changing slightly as people move to a price to value ratio for the way they look at their purchases. It’s no longer enough to just make a movie and throw it out and hope it makes money as everybody scrambles to buy it in a value market. Instead, the company is much more focused on quality content at a excellent value to the customer, whether that be as a rental or ownership or viewership via on demand (i.e. Hulu, etc.)

MiceAge discussed videos

noreply@blogger.com (Michael) — Tue, 28 Jul 2009 23:39:00 +0000

I’m not sure exactly why Al Lutz over at MiceAge didn’t feel comfortable with pointing directly to the two videos he cites in his recent post. I on the other hand have no such qualms, since Jack Lindquist was a master park operator and now Disney Legend. Plus, he’s a darn good story teller too and had me tied up in knots.

The other is a speech Walt gave to his employees at Disneyland on the 10th Anniversary. And while it contains a few words like ‘Hell’ and what not, it’s nothing more than you’d hear on any ABC show these days. Fact is I think you’d hear a lot worse on some late night shows!

It’s a great windows into what was going on at the time. I wonder if Marty was in the room?

Disney Cruise Line updates site

noreply@blogger.com (Michael) — Sat, 25 Jul 2009 14:03:00 +0000

Sometime in the last few days Disney Cruise Line has updated its site. The new site now looks much more like the Walt Disney World website. It has a nice Flash intro along with a more streamline user interface.

The cruise search and online checkin systems have been updated with the latter now offering options to upgrade your cruise right online which wasn’t offered before. The site now has several new virtual tour functions that work pretty nicely as well to show what the rooms look like, where they are located, etc. both in pictures, 360 views and a virtual ship.

Unfortunately it also looks like they went to press just a little early as there are more than a few niggly issues with rendering and some strange wording in a few places.

If I was king of the Disney Cruise Line website for a day, here are the things I’d change:

Add more fun and interactivity to booking your cruise. The current process is nice if somewhat pedestrian.

A couple of possible examples: Have Donald ‘lead’ mom through the process of booking with small movies that highlight different parts of the booking process. Donald can play the part of the curmudgeon in the group (yeah, that’s you Dad) while leading us through setting up our cruise.

Also, if you want to get the whole family onboard, then add the capability for the kids to login and see activities and stuff too (with minimal help from Mom and Dad).

Feel free to add your ‘blue sky’ thought to the comments section!
The website it technically executed well and all of the graphics are very well designed, polished and presented. However, the whole thing lacks a certain cohesiveness and simplicity. I’m a tech guy and I like knobs, but my dad nor my in-laws are and they don’t.

The option and checklist screens when you search for a cruise are exceptionally drawn, but they lack the intuitiveness and simplicity that ‘leads’ you through the process of making all the choices necessary. That’s why it should tie to number 1 above and leverage the strong characters and others to build a ‘story’ about going on a cruise as the adventure that it is.

People need to be able to tie that adventure together as a family, both nuclear and extended, to have as much fun planning and planning together from the initial cruise booking to setting up shore excursions as possible.

Social interactivity has a place here whether it be through Skype or Disney brokered meeting services or similar. Take the EPCOT dream and move it forward by allowing families to interact in conference with a Disney travel agent in voice or better yet, as EPCOT had in the 1980’s by video!
On the branding side, the Magic and the Wonder have the only ships whistle’s in the world that play ‘When You Wish Upon a Star’ vice the more typical ‘foghorn’ signal. Yet the beginning of the Flash intro movie uses a ships bell’s, more common in the Navy and the Coast Guard, then the Disney whistle.
On the technical side, I should be able to ‘associate’ my cruise to my login so I don’t have to enter my cruise information every time I log on. If this ‘feature’ is because of security (which I applaud, being the security conscious engineer/architect/system designer that I am), then maybe allow me to put in a PIN or something similar to cut down on the login process.
The website should be able to handle multiple cruises for one family. I should be able to have my profile show more than one cruise and the details about it. This would be handy if I booked a further out cruise while I’m onboard or just in anticipation of one of the longer cruises when they offer a good deal. I shouldn’t have to log in again to switch from one cruise to another.
TEST, TEST, TEST… especially with IE7, IE8, Firefox and at least WebKit browsers (i.e. Safari, iPhone, Palm Pre, etc.). Opera would be nice too, to make sure formatting and placement are correct.

Here is one example below or formatting gone awry. See that ‘hanging’ Save a Cruise? link in the top right? Looks like part of the sentence no?
Check and double check your English.

Here’s one example of strange punctuation and sentence structure:

‘Imagine being able to extend your dream vacation by staying in or near your departure or arrival port to soak up more of the excitement! Pretty soon, Disney Cruise Line Guests with 2010 sail dates can add to their cruise package a stay at Walt Disney World Resort—for the ultimate Disney experience—or in the enchanting European cities of Barcelona and London.
Return to this page this fall for all the details—coming soon!’
Fix the website so that it either runs entirely in SSL mode (i.e. HTTPS) or fix it so I quit getting pop up errors when the website pulls graphics from a HTTP site when I’m on a HTTPS page looking at my reservation. Most people don’t understand this error dialogue, and think it’s a problem with the web site.
If we are going to have a ‘Castaway Club page’ (and go through the effort of moving it to the new format) then we should probably update the information from the 2008 info that their now:
The Castaway Club Compass, Fall 2008 Issue:
"2010 Passage to New Disney Magic in Europe"
Add back the ability to ‘mute’ the sound on the main page. I like the Flash movie, but every time you surf back you get the full on movie as if you’d come to the site for the first time.

Disney teams up with Harvard

noreply@blogger.com (Michael) — Tue, 21 Jul 2009 22:10:00 +0000

This just popped into my mailbox today:

Waiting on the new year (fiscal that is)

noreply@blogger.com (Michael) — Tue, 21 Jul 2009 01:47:00 +0000

There has been a lot of continued speculation and rumor lately on the inter-webs about additions to this park and that park, upcoming moves to RFID, World of Color presentations, etc. etc. etc.

My guess is all of this is still rumor and only mostly approved since much of what we are seeing won’t be officially announced until late September or early October as Disney moves into it’s new fiscal year. Most of you Mouse watchers will remember this time of the year as when Disney usually makes some of its biggest announcements for the upcoming year.

I think most people’s perception because of that is that the Disney business calendar runs with the regular calendar, when it fact it runs from October 1 through September 30. They’ll announce what’s coming in 2010 in an effort to try and build excitement to get people to plan those trips next year and to book them before the end of 2009 as Christmas presents, or whatever.

It’ll be interesting to see if the booking window that Disney cites quite often has moved back out to make that more of a predictor of future bookings or not.

Regardless, I doubt we’ll hear anything about much of this rumor and conjecture for another couple of months. It takes that long in a big organization to collect all the required signatures and to get things moving.

I bet they’ll ‘announce’ something early at the D23 conference the first week of September however. Too big a moment to pass up.

More travel woes for the summer and fall

noreply@blogger.com (Michael) — Mon, 20 Jul 2009 01:30:00 +0000

NBC News had the following report posted on MSNBC this evening about the rapidly slowing travel industry with unemployment in the mid 9% range and poised to go higher before getting better.

Visit msnbc.com for Breaking News, World News, and News about the Economy

Also, this video about more high unemployment in other states, some of which I posted about yesterday in the state article.

Visit msnbc.com for Breaking News, World News, and News about the Economy

This is the economic environment I think we’ll hear more about from Bob and Tom later this week and how it’s effecting Disney, especially Parks and Resorts.

State crises part of Disney’s problem?

noreply@blogger.com (Michael) — Sun, 19 Jul 2009 02:00:00 +0000

The boards and several other blogs have been a light lately with the seemingly poor year-over-year attendance at Disney parks, especially those in Florida.

Len Testa over at the Touringplans.com blog for instance has posted earlier in the last week about rumors that Disney would bring back the 7-for-4 deal or extend the free food deal until well into December (rumor is that they are already doing free food until December for some lucky folks who get a PIN invitation via mail or e-mail). Len also noted in that post that he and Fred are figuring that Disney attendance has dropped year over year about 1% a week since late June. I’ve seen similar comments show up in other blogs and message boards as well, some with pictures of very short FastPass wait times in the Magic Kingdom.

If that’s true, then Disney’s 3rd quarter conference call this coming week is going to be very bad indeed. The strong showing of Up! non-withstanding.

The question of course is why? Why is attendance continuing to dwindle despite offers. One reason of course is that the food deal doesn’t start until August, but it’s been running at a minimum of a 5 night stay plus one day worth of park tickets for everybody in your group to get the free food.

That deal also leaves out most season pass holders (which is nothing new for free food), DVC members and Florida residents. In the past the free food deal required only as little as a 3 night stay, which also maybe affecting things, especially in the peak back-to-school and hurricane months of August and September. Not to mention that it’s usually miserable hot in Florida that time of the year, especially for Northerners. You won’t find a Canadian in the park until at least November. ;)

Like most macro economic trends, I’m sure the factors that are affecting Disney are many and varied. I also read an article on CNN.com this morning about the budget crises in several states and how it’s affecting people. California, Pennsylvania, Connecticut, Illinois, North Carolina and Ohio have all had huge budget issues according to this article at CNN. California has been issuing IOU’s and furlough days to both people the state does business with and it’s employees respectively. Pennsylvania won’t pay any state employees who have time on the books from July 1 on until their budget shortfall is fixed. Connecticut and North Carolina according to the article are under emergency spending measures, and Ohio and Illinois just got their budgets passed this last week.

That got me to thinking about how all of this mess is effecting Disney in a big way. Just look at California for instance. If a state employee has no money and is suddenly eligible for food stamps and assistance payments many businesses aren’t getting paid, doesn’t leave much money for Disneyland trips no?

Same with Florida. Look at that list of states east of the Mississippi again: Pennsylvania, Connecticut, Illinois, North Carolina and Ohio. If you visit WDW often, you don’t have to think to hard about all the people you run into from these states. But if their employees aren’t getting paid, that takes a big economic ‘pump’ out of action which affects everybody. Chicago is the only city that Disney currently has a remote DVC sales site and special planning setups to help families plan their vacation to WDW for instance. New Englanders in general are huge travelers to Florida.

I’m not saying it’s the only factor, but I gotta think it’s somehow a major contributing one. We’ll see what the numbers look like this week.

Congrats to Marty

noreply@blogger.com (Michael) — Sat, 18 Jul 2009 02:03:00 +0000

Many congrats to Marty Sklar today on his retirement from the Walt Disney Company. As one of the few remaining folks at Disney who actually knew and worked with Walt, I’m sure he’s both looking forward to retirement and yet leaving with some sense of sorrow.

Marty has been a great help to me over the last several years as I’ve worked to get through the pretty thick walls that surround Imagineering. We’ve only exchanged a few written letters and even fewer e-mails, but it’s because of him and his generosity that I know more people there today than I did two years ago. Like all things in these days, progress has been slow, but it has been progress on some level no doubt! Those letter and e-mails are of course now even more cherished in my small collection of Disney related artifacts.

I hope all of you will join me in both congratulating Marty on his well deserved retirement, but as I also said to him earlier this week in the last brief e-mails we exchanged before his retirement:

‘I certainly wish I had more of a compelling reason for us to stay in touch post retirement, if for no other reason than to hear some of the great stories I’m sure are still floating around out there over more than a few decades at WED and Imagineering. I certainly hope if we don’t, that you find some time to keep adding and filling in the background of a fascinating story and the lives surrounding it.’

From the guy in the front row of the upper balcony, ‘Bravo Marty, bravo…’ and Good Fortune! to you as well.

Disney Cruise Line adds two special 2010 holiday cruises

noreply@blogger.com (Michael) — Sun, 12 Jul 2009 19:12:00 +0000

I haven’t seen this in a press release yet or any place else for that matter. The folks over at Disney Cruise Line have added two special late 2010 cruises to the Disney Magic’s itinerary. The first is a 10 night Southern Caribbean Cruise and the second is an 11 night Southern Caribbean Cruise.

The 11 night runs 12/18 – 12/29/2010 and the 10 night runs from 12/29/2010 until 1/XX/2011. So you can spend Christmas on the first one or New Year’s on the second.

Here are the details for the 11 night:

11-Night Southern Caribbean Cruise

Ship: Disney Magic®

Ports of Call:	St. Maarten Guadeloupe Barbados Martinique St. Thomas/St. John Castaway Cay

Day	Port	Ashore	Onboard
Saturday	Port Canaveral	—	4:00 p.m.
Sunday	At Sea
Monday	At Sea
Tuesday	St. Maarten	7:45 a.m.	6:30 p.m.
Wednesday	Guadeloupe	8:00 a.m.	4:30 p.m.
Thursday	Barbados	7:30 a.m.	7:00 p.m.
Friday	Martinique	7:45 a.m.	5:30 p.m.
Saturday	At Sea
Sunday	St. Thomas/St. John	7:15 a.m.	4:30 p.m.
Monday	At Sea
Tuesday	Castaway Cay	9:45 a.m.	4:30 p.m.
Wednesday	Port Canaveral	7:30 a.m.

And here is the planned 10 night:

10-Night Southern Caribbean Cruise