Category: Disney News

For Walt Disney Co., power plays are nothing new.

The media conglomerate has had a history of leadership fights and succession struggles befitting a plot of the fairy tales associated with the company.

In the latest twist, on Monday the company’s succession planning was thrown into turmoil when Tom Staggs, Disney’s chief operating officer and the heir apparent to Chief Executive Robert Iger, unexpectedly announced he would step down. The news shocked many company employees and media watchers, who assumed Mr. Staggs, a close personal friend of Mr. Iger, would be named to succeed him.

The unexpected exit of No. 2 Disney executive Tom Staggs has thrown the media giant’s plan for a successor to CEO Robert Iger into disarray. WSJ’s Lee Hawkins details the corporate drama.

But behind the scenes, Disney directors concluded in recent weeks that Mr. Staggs was unlikely to get the CEO job based on a year of performance as chief operating officer. Now, after Mr. Staggs’ resignation, Disney’s board will “broaden the scope of its succession-planning process to identify and evaluate a robust slate of candidates for consideration,” the company said Monday.

A CEO’s expected successor rarely resigns so close to the expected transfer of power, according to succession experts. In rising to the No. 2 slot, Mr. Staggs already had beaten out another rival, former Chief Financial Officer Jay Rasulo, when Mr. Staggs was appointed chief operating officer last year. In June 2015, Disney said Mr. Rasulo would step down.

Mr. Iger was named CEO more than a decade ago, in 2005.

Before Mr. Iger’s tenure, his predecessor as CEO, Michael Eisner, was snared in a series of cinematic leadership battles. In 1994, after then-president Frank Wells died in a helicopter crash, Disney Studio chairman Jeffrey Katzenberg abruptly resigned and formed DreamWorks SKG because Mr. Eisner wouldn’t appoint him to the open president post. Mr. Katzenberg also sued Disney over the terms of his contract.

Mr. Eisner instead recruited his friend, Creative Artists Agency co-founder Michael Ovitz, to be president; Mr. Ovitz’s tenure lasted a little more than a year, although he received a rich severance package that led to a lengthy shareholder suit.

Mr. Eisner also tangled with Roy E. Disney, the son of Disney co-founder Roy O. Disney, in a fractious board dispute. In 2003, Mr. Eisner didn’t want the board to renominate Mr. Disney, citing a mandatory retirement age of 72. Mr. Disney resigned from his position as the company’s vice chairman, accusing Mr. Eisner of multiple management failures. Another board member, Stanley Gold, also resigned and urged the board to oust Mr. Eisner.

The following year, at Disney’s March shareholder’s meeting, some 45% of Disney’s shareholders—rallied by Mr. Disney and Mr. Gold—withheld proxies to re-elect Mr. Eisner to the board.

The company’s occasional struggles at the top goes back to the death of Walt Disney in 1966, which ushered in nearly two decades of unsettled leadership.

The company clung fervently to his vision, preserving his office exactly as he left it and adding few new animated features. That left the company creatively dormant. By the 1970s, Disney was the object of hostile takeover attempts.

It wasn’t until the board recruited Mr. Eisner from Paramount Pictures to be chairman and CEO in 1984 that the company was seen regaining focus.

In September 2005, Mr. Eisner stepped down as the CEO of Disney, and Mr. Iger has been at the helm ever since. Mr. Iger, 65, has said he plans to retire in June 2018.

Whether Mr. Staggs’ announced departure this week means that Mr. Iger will stay on past his announced retirement date remains to be seen, although Mr. Iger hasn’t indicated that he plans to do so.

SOURCE

Star Wars characters haven’t been strangers in Disney theme parks for some time now. Even before the cooperation acquired Lucasfilm and the Star Wars franchise, Darth Vader and Stormtroopers and other familiar faces were regular sights at Walt Disney World’s Hollywood Studios theme park in Orlando, Florida as part of the Star Wars Weekends event. And if you go back before that, there’s Star Tours, the ever-popular motion simulator attraction.

But between Disney now owning Star Wars and the upcoming Star Wars land being constructed in the Hollywood Studios park, these characters have officially been upgraded from guest stars to main cast members. Heck, they now have their own live stage show and everything.

The show, titled Star Wars: A Galaxy Far Far Away premiered today and Inside the Magic posted footage of the premiere. As you can see in the clips below, it’s a fairly straightforward and entirely plotless affair, an excuse for beloved characters from across all seven Star Wars films to appear in person, strike camera-friendly poses, and elicit cheers. It’s more of a pageant than a play, an advertisement for the character you’ll probably be able to have your picture taken with in another time and place.

If you want to watch the full show, which runs about 15 minutes, you can do so using the embed below. The structure is basic enough: a video presentation recaps the Star Wars saga and then various characters take the stage, even if them being in the same place doesn’t make sense at all. BB-8 and Darth Vader and Darth Maul and Kylo Ren all stand within ten feet of each other at one point. Nonsensical? Yeah. Crowd-pleasing? Sure thing. And Disney has to do something to keep guests at Hollywood Studios entertained, especially since a massive chunk of the park is currently under construction for the upcoming Pixar and Star Wars-themed lands.

Inside the Magic also shared footage of an additional show, where Captain Phasma leads a squad of Stormtroopers on a march through the park. Amusingly, Phasma has more to do in this silly parade than she does in the entirety of Star Wars: The Force Awakens.

Elsewhere, the Disney Parks Blog posted this photo of BB-8 peeking out from behind a fence and…staring at a bunch of dirt. Huh.

But Twitter had already figured this one out a few days earlier – BB-8 is staring at the site of Disneyland’s version of Star Wars Land, which is officially in the “moving tons of dirt around” phase of construction.

SOURCE

Disney Vacation Club is taking away discounts and perks for new buyers who purchase on the resale market rather than through the company directly.

Starting today, “members who do not purchase an ownership interest directly from Disney Vacation Development Inc. will not have access to Membership Extras,” the company says on its website.

The change only applies to new owners starting today. Current owners are grandfathered in.

“We see this policy change as a very positive step to ensure that, going forward, our Members who purchase directly from Disney Vacation Club receive a premium advantage – in addition to all the magic that Disney has to offer,” DVC said on its website.

Membership extras include discounts on merchandise, annual passes and restaurants. They also include access to a lounge opening soon at Epcot, a sweepstakes, and special events such as movie screenings, a member cruise and a recent party at the Magic Kingdom.

In 2011, DVC stopped allowing resale buyers to use their points for Disney Cruise Line, Adventures by Disney and the Concierge Collection, a group of luxury hotels.

“I think they always do things that protect their ability to sell for the full retail price,” said Chris Skeldon, vice president of sales at Fidelity Resales, which handles contracts from time-share resorts including Disney’s. “Why would people pay that retail amount if they’re not getting extra benefits?”

Disney Vacation Club properties are known for their high resale value. Recently, there has been a lot of interest in purchasing DVC memberships through another resale route: foreclosure auctions. Disney is now using nonjudicial foreclosures, which move more quickly and require people to bid in person.

“Frankly I am surprised it has taken Disney so long to make this move,” said Tim Krasniewski, editor of the DVCNews.com website, in an email.

“While resale purchases are clearly beneficial to the consumer, they undoubtedly cause Disney to lose direct sales. I’m sure it’s difficult to sell points at $168 each when a very similar product can be had for just $70-80 per point. Blocking resale buyers from the accessing some of the most beneficial perks like the Annual Pass savings and merchandise discounts can only have a positive effect on sales. However it may also cause a decrease in demand for resale contracts and an overall downturn in prices.”

The decision will affect current owners, because “when that person wants to sell the membership, the membership has a little less horsepower,” said Brad Shaffer, with Monera Financial, a company that provides financing for Disney Vacation Club resales.

SOURCE

The Jungle Book opens on April 15^th courtesy of Walt Disney DIS -1.70%. It starts its overseas rollout on April 7^th in some territories before slowly expanding around the world over the next two weeks. It will be playing pretty much around the world by the weekend of the 15^th, with a Japan release set for August 11th. That’s ironically one day before the U.S. release of the next one of these Disney “live-action version of an animated film” movies, Pete’s Dragon, opens in America and much of the world.

The film is, of course, the latest in a series of live-action adaptations (or live-action sequel/prequels) of Disney’s popular animated features. It comes on the heels of Alice in Wonderland, Oz: The Great and Powerful (yes, not technically from a Disney toon, but it still counts), Maleficent, and Cinderella.

The Mouse House has been full-steam ahead in this newest little quasi-franchise, greenlighting a Tim Burton-directed Dumbo, a Bill Condon-helmed Beauty and the Beast, and new versions of Mulan, Pete’s Dragon (coming in August) and a Reese Witherspoon Tinker Bell movie along with an Emma Stone-led Cruella de Vil movie. I’m sure I missed a few, but you get the idea.

All of these films have been varying degrees of successful, and this summer’s Alice Through the Looking Glass will be a test case as to whether these films can be sequel-ized. But back to The Jungle Book. The film will open three weeks before Captain America: Civil War and six weeks before the aforementioned Alice Through the Looking Glass and hot on the heels of the unexpectedly massive Zootopia.

The film’s biggest selling point will be its world-creating animation, shot and animated not in the jungles of India but Los Angeles studios using the kind of technical wizardry that helped create the likes of Avatar, Gravity, and The Life of Pi. Pre-release tracking has this one pegged at a $60-$65 million debut weekend, and I imagine the flood of (spoiler?) positive reviews two weeks before opening will only send that figure up accordingly.

The Review:

Jon Favreau’s The Jungle Book is every bit as visually splendid as you’re hoping it would be. I could spend the next paragraph explaining in detail how the film was constructed. Just know that nearly all of what you see during its 105-minute running time is created via animation and motion-capture work. My four-year-old son was entranced from beginning to end, totally unaware (save perhaps for moments of animals talking and singing) that anything was amiss, and hell if I am going to spoil the illusion for him.

The greatest strength of this new-fangled “live-action” adaptation of Rudyard Kipling’s novel (or more specifically, the 1967 Walt Disney animated version of said novel) is not just its effects work but rather the sheer believe-your-eyes achievement. Yes, there are moments where the camera goes to incredible places and gives us impossible perspectives (the opening seems like a live-action recreation of the vine surfing from the animated Tarzan), but there is just enough restraint to achieve the idea that what we’re watching is “real.” Favreau and company make the effort to maintain a hint of plausibility concerning how the picture is shot and edited.

As a result, the gorgeous (shot by Bill Pope) film feels “live action real” in as impressive fashion as, yes, Avatar, Gravity, and The Life of Pi. This is next-level wizardry, with just enough story and emotion to avoid feeling like a technical exercise. I am not going to say it’s as revolutionary an experience as Who Framed Roger Rabbit, but the fact that said all-time-classic came to mind should give you an idea of how engrossing this movie quickly becomes. It’s an unmitigated audio/visual knockout. It looks gorgeous in 3D, but I imagine it would look just as scrumptious in 2D as well.

As far as the story, well, you only get the “bare necessities” (sorry). This new film adds some attempted emotional beats and something of a hero’s journey arc that takes bits and pieces from Babe, The Lion King, and Tarzan. That will only be a (very slight) problem when Disney decides to use this technology to give us a “live-action” Lion Kingmovie.

The story concerns young Mowgli (Neel Sethi, giving a remarkable reactionary performance as basically the only flesh-and-blood thing onscreen) as he is forced to flee his forest home after he is marked for death by the insidious Shere Khan (a deliciously cruel Idris Elba). Although initially guided by Bagheera (Ben Kingsley), he eventually finds himself in the company of a friendly (if conniving and self-interested) bear named Baloo (Bill Murray). Murray and Kingsley play off each other quite well as dueling surrogate dads, and Chris Walken adds late-in-the-game charm and menace as a rather ginormous King Louie.

It was during Louie’s big scene where my son got the most frightened (a temporary and non-perilous situation), and I will admit some glee at my son having achieved the “freaked out by Christopher Walken” rite of passage. Yes, we do get renditions of the animated film’s two iconic songs, and yes the film does have its fill of exciting and intense action sequences. But despite the periodic escapes (and a blisteringly awesome climactic battle) that pepper the film, the overall feeling is more lackadaisical than a conventional action movie. The emphasis is on watching Mowgli and his animal compatriots talk with each other as opposed to fighting with each other.

There are some intense moments (the film doesn’t suffer fools regarding its PG-appropriate action and peril), but the film applies the Beauty and the Beast formula of interchanging a dark or dramatic scene with a light or comedic scene. The first act is comparatively grim as Mowgli struggles with his forced exile, but Bill Murray’s Baloo shows up right when the proceedings are getting a bit glum. Murray is this film’s comedic shot in the arm, equivalent to Robin Williams WMB -2.63%’s Genie in Aladdin or Mark Hamill’s Joker in (the obviously not Disney) Batman: Mask of the Phantasm.

All-in-all, The Jungle Book is a remarkable achievement and yet more reason to be optimistic about Disney’s “turn an animated classic into a live-action feature” sub-genre. I could quibble about the thin plot or the cribbed-from-The Lion King thematics, but the picture works precisely as intended. It’s a thrilling and visually splendid bit of popcorn entertainment that walks just enough on the wild side to make kids think they’re getting away with something.

It is also another fantasy winner for Jon Favreau who has somewhat unassumingly established himself as a genuinely successful “indie-to-blockbuster” triumph. He crafted a genuine holiday classic in Will Ferrell’s leggy blockbuster Elf and then basically created the entire Marvel Cinematic Universe with Iron Man. This one is closest in spirit toZathura, and I mean that as a compliment. The Jungle Book works as both a fine stand-alone piece of action fantasy as well as a worthwhile companion to its animated predecessor.

SOURCE

Yesterday was the last day for several attractions at Disney‘s (NYSE:DIS) least visited Florida theme park. Honey, I Shrunk the Kids Movie Set Adventure — the long-standing attraction where kids play on a super-sized backyard playground — and the Lights, Motors, Action! Extreme Stunt Show closed on Saturday. Several nearby attractions, shops, restaurants, and character greeting areas will also be joining Honey, I Shrunk the Kids Movie Set Adventure and Lights, Motors, Action! Extreme Stunt Show in being unavailable to guests starting today.

Disney has a very good reason for shutting down the heart of its Streets of America section, a move that will find even the park’s iconic mouse-eared water tower eventually coming down. This is the back of the park where Star Wars Land and Toy Story Land will ultimately rise, transforming Disney’s Hollywood Studios from a dud to a rock star in its theme park empire.

It can’t happen soon enough. Disney’s Hollywood Studios recently saw Animal Kingdom pass it up to be Disney World’s third most visited attraction. With rival Comcast (NASDAQ:CMCSK) (NASDAQ:CMCSA) making big gains at its movie-themed park and Islands of Adventure sibling, Disney can’t afford to phone it in anymore. It can’t let Disney’s Hollywood Studios be the afterthought that it has been over the past few years. Just check out the annual attendance trends at the six Central Florida parks owned by Disney or Comcast over the past five years through 2014, the last year that we have official third-party data.

SOURCE: THEMED ENTERTAINMENT ASSOCIATION.

The dramatic growth spurt at Comcast-owned parks since 2009 can be attributed largely to the Harry Potter-themed expansion at both of its Florida gated attractions, but Comcast has also been active in expanding and updating Universal Studios Florida with more relevant rides. Disney’s Hollywood Studios has been scaling back during that time, so it’s not a surprise to see the park gain just 612,000 in annual attendance over five years while its rival a few minutes away is greeting 2.733 million more guests a year than it was five years earlier.

This will all change of course. Toy Story Land and Star Wars Land will breathe new life into a park that will likely bear a new name by the time those two expansions are complete. The rub is that it will take several years for that experience to materialize, and Disney’s Hollywood Studios will have voids to fill as hardhats take over significant sections of the park. It will be an issue. The vehicle stunt show had capacity for 5,000 guests several times a day. The Honey, I Shrunk the Kids Movie Set Adventure gave young children a unique playground to unwind in a park that has few actual rides suitable for the younger set. With Disney prices inching higher every year — it now costs as much as $114 plus tax for a one-day ticket to Disney’s Hollywood Studios — it can’t afford to be barren for too long. You can only fool park guests for so long passing off Star Wars-themed short films and fireworks shows as marquee attractions.

Disney should have done a better job of preparing its least visited Florida park for the lull before its ambitious dreams become a marketable reality. Comcast got it right. It’s odd to see Disney blow it here.

SOURCE

The beastly grosses for Disney’s Zootopia continued to pile up this weekend as eager moviegoers extended the animated feature’s record-setting China haul to $220 million. That’s within striking distance of Disney’s all-time China record holding Avengers: Age of Ultron, which scored $240 million last May.

The highest grossing film ever in the PRC is Stephen Chow’s blockbuster comedy-with-a-social-conscience The Mermaid, which recently concluded its run with a $523 million haul.

Image credit: Disney

Zootopia has had what is now officially the leggiest box office run in history for a wide opener in China. Its 62x multiple from its opening day of 22.9 million yuan (US$3.5 million) has beaten out the 61.9x opening day multiple that local language comedyGoodbye Mr. Loser achieved in October, 2015, when it captivated audiences last fall with a 1.4 billion yuan ($227 million) total run after a 23 million yuan opening day. It also recently beat the animation record multiple of 53.1x that had been set by last summer’s Monkey King: Hero is Back.

This weekend, its fourth, the talking animal picture had an exceptional hold on ticket buyers, dropping a very modest 25 percent for an $11.9 million 3-day total. On Sunday it actually outgrossed Batman v Superman, which is only in its second weekend, earning $6.5 million versus the superhero pic’s $5 million.

The two-week extension gives Zootopia a reasonable chance to catch Avengers: Age of Ultron and surpass it to become Disney’s biggest Middle Kingdom hit to date. With weak local competition in the coming weeks, and surprisingly resilient box office super powers, Zootopia might just wind up defeating the superheroes.

SOURCE

Disney‘s (NYSE:DIS) Shanghai Disneyland Resort won’t open until June 16, but first-day tickets were sold out within a few hours of becoming available at midnight on March 28. Rooms at the resort’s two on-site hotels, the Toy Story Hotel and the Shanghai Disneyland Hotel, were also fully booked for the first two weeks. That pent-up demand indicates that the new park could soon become a major growth engine for the House of Mouse’s massive theme park business.

TREASURE COVE AT SHANGHAI DISNEYLAND. IMAGE SOURCE: DISNEY.

Shanghai Disneyland by the numbers
Disney COO Tom Staggs believes that the new park will mainly attract visitors from the 330 million “income qualified” people who live within a three-hour car or train trip from Shanghai. Off-peak tickets cost 370 yuan ($57), while peak tickets cost up to 499 yuan ($77) for the park’s first two weeks, all weekends, and the summer months of July and August. Those off-peak tickets notably cost about 20% less than comparable tickets at Hong Kong Disneyland, which is only a third the size of the Shanghai park.

Disney hasn’t issued long-term sales projections for the new park, but Chang Jiang Securities analyst Li Jin recently estimated that the park will generate 24 billion to 40 billion yuan ($3.7 billion to $6.2 billion) in sales per year, from up to 50 million annual visitors. However, Disney will split sales with its joint venture partner Shanghai Shendi Group, which owns a 57% stake in the park.

Last year, Disney’s Park and Resorts revenue rose 7% annually to $16.2 billion and accounted for 31% of its top line. If Li’s forecast is accurate, Shanghai Disneyland might boost the unit’s annual sales growth to double-digit territory within the first year. With 50 million annual visitors, Shanghai Disneyland could also become Disney’s busiest single park. By comparison, Walt Disney World’s four theme parks hosted a combined 51.5 million visitors in 2014, according to market tracker TEA’s most recent numbers.

SWEETHEART CONFECTIONARY AT SHANGHAI DISNEYLAND. IMAGE SOURCE: DISNEY.

Shanghai Disneyland might offset other problems
The growth of Shanghai Disneyland could help Disney offset its weakness in cable broadcasting, where cord-cutters have gradually reduced its subscriber numbers. Between the end of 2014 and 2015, its number of ESPN subscribers dipped from 95 million to 92 million. The Disney Channels, ABC Family/Freeform, and A&E all posted similar declines.

Last quarter, Disney’s Media Networks revenue rose 8% annually and accounted for 42% of its top line. But the unit’s operating income, which accounted for a third of its bottom line, fell 6%. Disney blamed that decline on lower profits from ESPN and its stake in A&E, which was only partially offset by growth from the domestic Disney Channels. The problems at ESPN have worried investors for two reasons: live sports had previously been considered immune to cord-cutting, and the cost of securing sports rights has risen dramatically over the past few years.

Bears claim that Disney’s Media Networks business will struggle, causing companywide sales and earnings growth to stagnate or decline. However, that thesis ignores the notion that new theme parks and movie franchises might offset the softness of its media business.

But Disney shouldn’t get too comfortable
Shanghai Disneyland could be a huge revenue driver this year, but investors should remember that other companies are eyeing the same growing market of middle-class Chinese consumers. Chinese conglomerate Wanda Group plans to spend over $32 billion on new theme parks and entertainment facilities by 2020 to boost its massive real estate footprint across China.

Comcast‘s (NASDAQ:CMCSA) NBCUniversal also plans to open a new Universal Studios theme park in Beijing by 2019. Based on the strong performance of its park in Japan, which hosted 12.7 million visitors during its last fiscal year, the new park could also enjoy success in China.

There’s likely enough room for all these parks to co-exist without being direct competitors, but they indicate that the theme park market in China is just starting to heat up. Therefore, investors should consider robust ticket sales to be a positive development for Disney, but remember that it’s not a magic bullet for fixing its cord-cutting issues.

SOURCE

In a familiar yet different world, a young student finds out they have a penchant for magic and go to school to learn more about it. No, this isn’t Harry Potter. While it may seem similar on the surface The Paper Magician series is actually quite different—and Disney just bought the movie rights to it.

Written by author Charlie N. Holmberg, The Paper Magician is the first in a trilogy of books about a young girl named Ceony Twill. In her world, magicians manipulate and animate man-made materials and learn to do so at the Tagis Praff School for the Magically Inclined. However, Ceony isn’t assigned metal, the most prestigious material to work with. She’s given the less-important paper, which puts her in a unique position when a new evil appears in the world.

It’s a curious premise for a book and, with Disney now in control, a very intriguing one for a movie, too. Producer Allison Shearmur, who worked on The Hunger Games, Cinderella, and Rogue One, is in charge of development.

And, of course, if the movie happens and is a success, there are two sequels out there too. There’s The Glass Magician and The Master Magician, all of which were written by Holmberg, who got her start as an author writing Star Trek fan fiction.

SOURCE