Mickey Mouse - The Force is with You

This week's Tip Tuesday post will take a back seat to the major, galactic-sized news that came out late today - Disney is buying Lucasfilm for just over 4 billion.

There's a lot of news already out on this developing story, so I won't spend much time on the finer details.  Instead, I will share my thought on what this new acquisition will mean for Disney and for the parks.

To recap, here are the basic details of the deal, announced today:

• Disney will own Lucasfilm, including all the affiliated operations like Industrial Light and Magic, Lucas Arts and Skywalker sound.  
• Disney will own the rights to all Lucasfilm characters and stories - this includes Star Wars and Indiana Jones.
• Kathleen Kennedy, current co-chair of Lucasfilm will become President of Lucasfilm and will come under the Walt Disney Studios.
• Total purchase price is $4.05 billion.  This deal has yet to be approved by certain government antitrust regulations.
• Lucas will become a major shareholder of Disney - the 10th largest.

So those are the details of the deal - in a nutshell.  Again there's so much more to this, so I suggest you check out some of the following news releases and news coverage.
Official Disney news release
Starwars.com video announcement by George Lucas
Coverage by CNBC.com
Coverage by the Wall Street Journal

But wait... there's more!

As if the purchase announcement wasn't enough, Lucas dropped another proton torpedo: Star Wars:  Episode 7 is coming in a few years.  Yes, you read this correctly - Episode 7!!!  In an interview on Starwars.com, Lucas revealed he has developed story treatments for Episodes 7, 8 and 9.  Episode 7 is in story development and is initially slated for release in 2015.  Bob Iger, Disney CEO indicated additional Star Wars films could be coming out every two or three years following Episode 7.

So it seems fairly certain that we will have a new Star Wars trilogy for an entirely new generation of Star Wars fans.

So what will this mean for Disney and for the parks?

First, it means Disney, literally, has a whole new galaxy of characters and story material to draw from.  It also means that you will see a lot more Star Wars and Indiana Jones coming to the parks.  Could this be the final hurdle for the long-rumored "Star Wars land" at Disney Hollywood Studios?  Could this lead to something even bigger -- an entirely new 5th park?  I suspect we may hear some major, major, major (did I say major?) announcements at the D23 Expo next August related to Star Wars, both in terms of movies and the parks -- oh and there's also consumer products as well.  There's so much to this deal.

Here's what I think this deal also means (though I have little to back this up, so it's just my gut feeling):  Avatar-land at Animal Kingdom is dead.  There have been reports that the deal between James Cameron and Disney was becoming shaky over investment prices and creative control.  I suspect now that Disney and Lucasfilm are in the same family, James Cameron will be left out in the cold.  I could be wrong, but, to quote every Star Wars movie, "I have a bad feeling about this."

The more I think about this deal, the more I start to see what Iger's legacy will be for the Disney company.  Walt's legacy is Mickey Mouse and Disneyland.  He started it all.  Eisner's legacy is reinvigorating Disney animation and growing the parks.  Iger's legacy will be growing the Disney family.  Think about it.  Under Iger's leadership, Disney has purchased Pixar, Marvel and now Lucasfilm.  In the span of only a few years, Disney's book of available stories and characters has exploded and the Disney family is larger than ever.

I personally can't wait to see just how far Disney/Lucasfilm can go together.  I'm ready to again jump into hyperspace to a galaxy far, far away.

The Force is with us.

Top 10 Disney/Marvel crossovers

With the news today that Disney is purchasing Marvel (and its 5,000+) characters, I figured it would be fun to imagine some of the possible (well, maybe not-so-possible) crossover combinations.

And here we go...

10. Stitch joins the X-Men (Disney puts Stitch in everything else, why not the X-Men?)

9. The Fantastic Four and The Incredibles will work together (and realize they've all got the same powers!)

8. Monsters Inc. 2 will be a more extreme story with the Hulk, Wolverine, and Dr. Doom joining the scare floor.

7. Spiderman 4 will have Mickey Mouse playing the part of the Web-head.

6. Rapunzel will now be played by Mr. Fantastic in drag. No need for special effects now.

5. Mini-Mouse takes on a whole new meaning.

4. An Ape-Man attraction will show up at Animal Kingdom (along with any other Marvel characters even remotely related to animals)

3. The Kim Possible World Showcase Adventure will be replaced by the Avengers Race to Save the World (or something like that). Of course, Kim Possible will join the Avengers, though Ron Stoppable doesn't make the cut.

2. Fantasmic! will be changed to Magical Marvel!

1. Much like the infamous hidden Mickey, we now get to look for hidden Stans (as in Stan Lee) in every Disney/Marvel movie and the parks. He makes a cameo in all the Marvel movies, so why not slip in an animated Stan Lee in some Disney films?


What crossover do you see? Post a comment!!

Universal spokesperson says Disney/Marvel deal won't impact park

More from today's stunning news that Disney is purchasing Marvel:

Questions quickly arose over the future of Marvel-themed attractions located at Universal's Islands of Adventure in Orlando.

Here's what a Universal spokesperson said to the Orlando Sentinel:
"Marvel Super Hero Island at Universal's Islands of Adventure and the Marvel characters are a beloved and important part of the Universal Orlando experience. They will remain so," said Tom Schroder, a Universal spokesman. "Our guests are going to get to meet Spider-Man and all our other Marvel characters. We believe our agreement with Marvel stands and that the Disney/Marvel deal will have no impact on our guest experience."

Disney CEO Bob Iger said the following on CNBC today:
"Marvel characters have already proven to be strong in terms of theme park attraction and we believe there are a lot of opportunities around the world, not in every one of our parks because there are some existing agreements that we obviously have to honor, but in a number of places for us to use the Marvel characters to basically help us grow our theme park business and better entertain people."

My take:
While it appears Spiderman, the Hulk, the X-Men and Doctor Doom won't be coming to Walt Disney World (Universal apparently has the east coast rights for as long as the attractions are operating), you can bet that no new characters will be coming to Universal. I wouldn't be surprised if a team of Disney lawyers also will be looking to find some holes in the deal. In the meantime -- it appears the doors are wide open for Spiderman and the rest of the Marvel cast to swing their way into any other Disney park, for instance, Disney's California Adventure. This also may be the concept Disney's been looking for to finally build the third California-based park.

This is all just guesswork right now. One thing's for sure, Disney is looking to the future and they've just grabbed one of the two major players in the superhero genre. I wonder what DC Comics thinks about this? Of course, DC Comics and Warner Bros. teamed up years ago.

Mickey and Spiderman to become corporate cousins

You read that right! Believe it or not, Mickey Mouse will soon be related to Spiderman, the X-Men and the Hulk.

Today, Disney announced they are purchasing the Marvel Entertainment Co. for four-billion dollars. Below is a news release from Disney:


Building on its strategy of delivering quality branded content to people around the world, The Walt Disney Company (NYSE:DIS) has agreed to acquire Marvel Entertainment, Inc. (NYSE:MVL) in a stock and cash transaction, the companies announced today.

Under the terms of the agreement and based on the closing price of Disney on August 28, 2009, Marvel shareholders would receive a total of $30 per share in cash plus approximately 0.745 Disney shares for each Marvel share they own. At closing, the amount of cash and stock will be adjusted if necessary so that the total value of the Disney stock issued as merger consideration based on its trading value at that time is not less than 40% of the total merger consideration.

Based on the closing price of Disney stock on Friday, August 28, the transaction value is $50 per Marvel share or approximately $4 billion.

"This transaction combines Marvel's strong global brand and world-renowned library of characters including Iron Man, Spider-Man, X-Men, Captain America, Fantastic Four and Thor with Disney's creative skills, unparalleled global portfolio of entertainment properties, and a business structure that maximizes the value of creative properties across multiple platforms and territories," said Robert A. Iger, President and Chief Executive Officer of The Walt Disney Company. "Ike Perlmutter and his team have done an impressive job of nurturing these properties and have created significant value. We are pleased to bring this talent and these great assets to Disney."

"We believe that adding Marvel to Disney's unique portfolio of brands provides significant opportunities for long-term growth and value creation," Iger said.

"Disney is the perfect home for Marvel's fantastic library of characters given its proven ability to expand content creation and licensing businesses," said Ike Perlmutter, Marvel's Chief Executive Officer. "This is an unparalleled opportunity for Marvel to build upon its vibrant brand and character properties by accessing Disney's tremendous global organization and infrastructure around the world."

Under the deal, Disney will acquire ownership of Marvel including its more than 5,000 Marvel characters. Mr. Perlmutter will oversee the Marvel properties, and will work directly with Disney's global lines of business to build and further integrate Marvel's properties.

The Boards of Directors of Disney and Marvel have each approved the transaction, which is subject to clearance under the Hart-Scott-Rodino Antitrust Improvements Act, certain non-United States merger control regulations, effectiveness of a registration statement with respect to Disney shares issued in the transaction and other customary closing conditions. The agreement will require the approval of Marvel shareholders. Marvel was advised on the transaction by BofA Merrill Lynch.

Park attendance up

According to CNBC article, attendance at the domestic Disney parks increased by three percent, beating analysts' expectations. The biggest factor leading to the increase in attendance was Disney's "Buy 4, get 3 free" deal offered in the spring.

However, the news is not all good. Even with the increased attendance, total revenue at the parks was down nine percent and operating income down 19-percent. Even this loss is better than expected, according to the article, because in the prior quarter, park operating revenue was down about 50-percent.

Disney CEO Bob Iger said Disney's latest numbers are a sign that the economy is stabilizing.

Let's hope so.

As expected, Disney reports a loss for the 2nd quarter

Just as many had anticipated, the Walt Disney company reported very poor financial performance for the 2nd quarter of this year (Jan-March, 2009). Profits fell by more than 45% as compared to this time a year ago. Performance at the theme parks were especially poor, with profits falling more than 50% as compared to this time last year.

Disney cited several factors to explain the poor performance, especially in the parks. One major reason was the fact that the Easter/Spring Break season was in April (which is in the 3rd quarter) as opposed to March. Also, Disney did offer major discounts to encourage park attendance.

Read Disney's official earnings release here: http://corporate.disney.go.com/investors/quarterly_earnings/2009_q2.pdf

Disney's 2nd quarter earnings expected to be poor

According to a CNBC report, Disney is expected to report another loss when it announces earnings for the second quarter of the year. Already, some stock analysts are advising investors sell Disney stock, which closed today at more than $22 a share (up from about $15 a share just two months ago).

I know what the media stock analysts say, but I think it's a good idea to hold onto Disney stock (I don't own any Disney stock, nor am I some sort of financial expert, so this is just my .02 worth). Yes, the second quarter earnings are still going to show a loss, that shouldn't surprise anyone. Yes, the stock price will probably fall. But to go and sell now is to over-react the same way the mainstream media is over-reacting to the current swine flu issue. Stick it out. Call me an optimist, but I think six months to a year from now, Disney stock will be higher than it is now.

Why am I so optimistic? Think about the lineup of films in the next year or so: UP, Toy Story 1&2 in 3D, Toy Story 3, The Frog and the Princess, A Christmas Carol and more. I agree, the parks have had to offer incentives to boost attendance (and it's worked, based on recent reports of packed parks in the past month), but those who aren't (or can't) planning major trips may find themselves in a movie theater. With the summer school vacation coming, you can bet kids are waiting to see the next Disney movie.

Disney cuts 11% of entire parks staff

CNBC.com is reporting that Disney announced yesterday that they have cut about 1,900 positions (or 11% of the entire workforce). Of those 1,900 positions, 700 were open positions that will go unfilled, while the remaining 1,200 were eliminated through layoffs. The large majority of the cuts applied to managers and salaried staff as opposed to hourly employees.

"These decisions were not made lightly, but are essential to maintaining our leadership in family tourism and reflect today's economic realities," said Disney spokeswoman Tasia Filippatos in a statement.

Disney announces significant long-term environmental goals

BURBANK, Calif., March 9, 2009 -- The Walt Disney Company today announced a landmark set of strategic environmental goals and challenging 3 to 5 year targets to reduce emissions, waste, electricity and fuel use, and its impact on water and ecosystems.

The goals are part of Disney's 2008 Corporate Responsibility Report, which details the company's approach to critical corporate responsibility issues ranging from charitable giving to
nutrition and from online safety for kids to workplace diversity.

"Disney's enhanced corporate responsibility efforts make our brands and products more attractive, strengthen our bonds with consumers, make the company a more desirable place to work and build goodwill in the communities we operate," said Disney president and CEO Robert A. Iger. "All of this contributes to shareholder value."

The interactive multimedia report, now available online only at http://disney.go.com/crreport/home.html, provides a detailed snapshot of the company's philosophy and activities in five areas; children and family, content and products, environment, community and workplaces. Details include the company's first comprehensive greenhouse gas inventory and updates on Disney's pioneering policies on healthy food guidelines and smoking in films.

Building on 20 years of work by Disney's environmental affairs department, the new goals and targets were formulated over the last two years by an Environmental Council of senior executives from across the company. Charged with developing and implementing sustainable strategies for Disney's impact on the environment, as well as ways to use the company's media reach to encourage positive action, the Council has taken a measured, scientific approach in analyzing company operations and crafting strategic objectives.

"While Disney has always been a leader in environmental stewardship, we are taking ambitious steps to help preserve our planet for future generations," said Disney Senior Executive Vice President and CFO Thomas O. Staggs.
The long-term environmental goals outlined in the report are:

Zero waste

Zero net direct greenhouse gas emissions from fuels

Reduce indirect greenhouse gas emissions from electricity consumption

Net positive impact on ecosystems

Minimize water use

Minimize product footprint

Inform, empower and activate positive action for the environment

For additional details and medium–term targets visit www.disney.com/crreport
"We applaud Disney for its leadership in adopting these goals, especially at such a challenging time in the global economy," said Peter Seligmann, Chairman and CEO of Conservation International. "Disney's vision underscores the continued interest in the environment among people worldwide and the growing recognition that environmental leadership can help revitalize the economy." Conservation International provided advice to Disney on its new goals and targets.

The 2008 Corporate Responsibility Report represents the latest phase in Disney's longstanding heritage of corporate social responsibility and reflects a company-wide effort to build an integrated, transparent strategy focused on serving the needs of the company's primary stakeholders; consumers, employees, shareholders, business partners and the communities in which it works.
The report is organized as follows:

Children and Family – guiding principles, kids' health and nutrition, creative practices, programming philosophies and marketing policies

Content and Products – standards and practices, content diversity, product safety policies and parks accessibility and safety

Environment – environmental initiatives, progress and long-term goals

Community – charitable giving, VoluntEAR and community outreach updates

Workplaces – employee diversity, benefits and international labor standards

The report anchors a broader suite of publications being issued today. Six additional reports provide information specifically on Disney's Parks & Resorts segment and the following operations: Disney Cruise Lines, Walt Disney World, Disneyland, Disneyland Paris and Hong Kong Disneyland. The suite of reports highlights issues of importance to local communities at some of the company's largest sites.

Disney announces layoffs at domestic resorts

This from the "we all knew it was coming" file:

The Orlando Sentinel has an article today about Disney's announcement to eliminate an unannounced number of positions as part of an overall downsizing of the east coast and west coast resort divisions. In short, functions that take place both at WDW and Disneyland may be combined so that one location may handle particular functions for both resorts.

The company pointed to the joint development of Toy Story Mania, which was added to both Disney's Hollywood Studios and Disney's California Adventure. By working on both attractions at the same time, Disney held down development costs.

Disney also said it would create a new "Global Business Development team," which will work to combine existing business and real-estate development functions. This team will be responsible for focusing growth strategies at existing parks-and-resorts businesses and identifying new opportunities around the globe.

My take: Disney is doing all it can to weather the economic downturn. No one likes reducing their staff, but in this climate, you have to do what's necessary to survive. Let's hope that the stimulus plan will actually do what it's supposed to do and stimulate the economy, which can, in turn, get more people to the two U.S.-based resorts and turn things around. At the end of today, Disney stock was still under $18 a share, well down from $35 a share back in May, 2008.

Maybe once the dust settles, some good will come of this shuffle. We can only hope. But as Walt said, we have to "keep moving forward."

LEGO and Disney link up

CNBC is reporting that Disney and the LEGO company are teaming up to create a new line of build-your own toys based on three popular Disney titles - Toy Story, Cars and the upcoming Prince of Persia. These new toys should be available in 2010.

Toy Story Children's imaginations will go "To infinity and beyond" when, beginning in 2010, they will be able to re-create the adventures of Buzz Lightyear and Woody with LEGO toys inspired by the Toy Story franchise. Toy Story-themed construction sets will be available on both LEGO DUPLO and LEGO System platforms, building the adventure and fun for children ages 2-12. LEGO System products based on Toy Story and Toy Story 2 will launch in January 2010, to be followed in May by construction sets based on the new animated feature, Toy Story 3, scheduled to hit theaters in Disney Digital 3D June 2010. Toy Story-themed LEGO DUPLO products launch in June 2010.

Cars Lightning McQueen will rev his engine at the starting line of a DUPLO portfolio that will have young builders creating and exploring the high-octane world of the Cars franchise. The Cars-themed LEGO DUPLO line will feature iconic scenes from Radiator Springs and the Piston Cup Championship raceway and will feature favorite Cars characters like McQueen, Mater and Sally. Cars-themed LEGO DUPLO products are scheduled to launch in June 2010.

Prince of Persia A line of LEGO System construction toys based on Walt Disney Pictures' and Jerry Bruckheimer Films' Prince of Persia: Sands of Time, produced by Jerry Bruckheimer, directed by Mike Newell and scheduled to release in May 2010 is also in development. The film, based on the best-selling video game franchise of the same name, stars Jake Gyllenhaal, Ben Kingsley, Alfred Molina and Gemma Arterton in an epic tale of Prince Dastan's struggle to stop an evil ruler from unleashing a sandstorm that could destroy the world. Prince of Persia-themed LEGO products are scheduled to launch in April 2010.

Of course LEGO already has a presence at Walt Disney World, at Downtown Disney. I'm sure these new toys will be a hot item in Downtown Disney once they are released.

Disney and DreamWorks sign distribution deal

Well, it's official. Last week, we were hearing about talks between Walt Disney Studios and Steven Spielberg's DreamWorks SKG for a distributing deal. This afternoon, according to CNBC, the two inked a deal for Disney, under the Touchstone brand, to market and distribute six DreamWorks films a year, beginning in 2010.

DreamWorks had attempted to negotiate a deal with Universal, but those talks fell through.

Note, that this deal does not involve DreamWorks Animation, which is a separate business unit.

As I mentioned in last week's post, I wonder what effect this will have on Universal Orlando, as DreamWorks was one of the major sources of new theme content for the park. What impact with this have on Walt Disney World? Will we see some Spielberg characters coming to the parks? Could this be the impetus to re-do the Great Movie Ride with more DreamWorks characters (since the MGM deal died out last year).

Who knows?

DreamWorks to partner with Disney?

The Associated Press is reporting that DreamWorks, the animation studio founded by Steven Spielberg, is apparently in talks with Disney to distribute six movies a year. This after talks between DreamWorks and Universal broke down earlier this week.

This information apparently comes from an unnamed source.

Universal, which is part of the NBC family (and ultimately part of General Electric) confirmed that talks had ended between the distributor and Spielberg.

Disney has not confirmed that talks are taking place.

This can only be good news for Mickey as eariler this week (see previous post), the Disney studios posted a 26-percent loss for the quarter.

But here's an interesting question: if DreamWorks does partner with Disney, what effect will this have on the Disney/Pixar relationship (yes Disney owns them, but would this new partnership create some bad feelings)? Also, how would this impact the parks? This has to be terrible news for Universal Studios Orlando, as they relied on DreamWorks for new material for the theme park. Would Shrek be moving a little further south on I-4?

Iger says weak theme park attendance partly led to disappointing revenues

CNBC has an interview with Disney CEO Bob Iger in which he discusses Disney's disappointing stock performance this quarter. Iger said lower theme park attendance in addition to sagging broadcast and film revenues contributed to the less than expected results.

Revenues for the Disney Parks fell four percent to $2.67 billion mostly due to lower attendance at Walt Disney World and Disneyland and lower hotel occupancy at on-property resorts.

If that wasn't bad enough, the Disney Studio revenues dropped a whopping 26-percent to just under $2 billion. In a bit of good news, revenues at the Disney Channel and ESPN rose two-percent to $2.45 billion. ABC revenue, however, wiped away any gains for the broadcast segment as ABC revenues dropped 14-percent to $1.45 billion.

I'm no economist, but it seems clear to me that the studios and ABC are where the problems really lie. A four-percent drop in the parks isn't good by any means, but it's nowhere near the 26 and 14 percent declines by the studios and ABC respectively.

Also on CNBC: Overall report on Disney's 1st Q earnings.

Disney to consolidate ABC units / Top execs asked to retire

CNBC is reporting that Disney has decided that the two halves of ABC should become one again. ABC Entertainment and the ABC Studios will merge and create the ABC Entertainment Group. No jobs will be affected by the move.

Also yesterday, Disney offered a buyout option to about 600 executives at the domestic theme parks (Disneyland/DCA and Walt Disney World) in order to cut costs. So far, there's no word how this will affect the parks. Let's hope the Disney magic stays as, well, magical as it always has been despite these cuts and staff reductions.

Hang in there folks, things will get better one day. Remember what Walt said, "Keep Moving Forward."

Disney Daddy presents "Tip Tuesday"

In a new feature I hope to provide every week, I'll give a tip for visiting Walt Disney World. Some of these are tips I've heard, others are tips I've learned from my own visits to WDW. So without further ado, here's this week's Tuesday Tip:

Take full advantage of PhotoPass

Now anyone who's been to Walt Disney World probably has seen the PhotoPass photographers all over the parks. What you may not realize is that after your trip, you can go online and order your photos - all on one CD. Now for the tip: while you're at the park, get as many PhotoPass pictures as you can (in both portrait and landscape) - then when you go online to view your photos, be sure to add as many enhancements as you can. When you save a photo with an enhancement (graphic, border, etc.), it saves a copy of your photo, so your original is not changed.

Once you have enhanced all the photos you want, you can order the CD of EVERYTHING. This is the real deal of PhotoPass. The CD runs about $150 or so. Now that may seem like a lot, but it isn't all that much when you think about how much you spend ordering individual prints. Oh, and it doesn't matter how many photos you have. Only have 50 images? Have more than 250? The price is the same. So if that's the case, go for it while you're in the parks -- make that PhotoPass CD that much more of a value.

I've personally done this twice and the CD was worth every penny. Oh, worried about copyright problems when you take a digital image to a printer or photo store? No worries, Disney even gives you a copyright release.

So take advantage of the PhotoPass CD - you'll be glad you did.

Be sure to check back for the next Tip Tuesday!

Depp-ending on Depp

If you're a Johnny Depp fan, get ready to see more of him on a Disney big screen - a whole lot more of him.

According to the Hollywood Reporter, Depp will star in Pirates of the Caribbean 4 (Jack is back!), Alice in Wonderland (as the Mad Hatter), and The Lone Ranger (as Tonto).

We can only guess what the topic of the fourth Pirates movie will be, but it's a safe guess the fountain of youth will come into play (see the end of the third movie). I just hope the script is much stronger than the third film.

Other interesting news to report: Cars 2 will come out a year earlier (2011) and Oprah will voice a character in the upcoming Princess and the Frog. While I hope Oprah will bring some additional attention (and revenue) to the movie, I hope she doesn't oveshadow the entire thing.

Also, National Treasure 3 is in development. I guess we'll find out about that other page in the Book of Secrets.

What wasn't talked about much was Tron 2. I can't wait to see this one. Like many Disney fans, I saw the bootleg trailer. Even though the video was awful - the trailer looked incredible. I really wish Disney would make that available.

Oh, and despite what the article may say (in jest), Depp is not the mascot for Disney. That role still lies with the head cheese. Mickey is king.