disney tables

Table -2 Media networks ABC TV Stations: 10 stations Cable Subscribers: ESPN Disney Channel Toon Disney Lifetime Network A&E ABC Family The History Channel E! Entertainment Jetix Network SOAPnet Style The Biography Channel History International Walt Disney Internet Group Radio Disney Network Studio Entertainment Business Parks and Resorts Business Walt Disney World Resort Walt Disney company Disneyland Resort Revenues: $34,285 (2006, in millions) Tokyo Disney Resort Disneyland Resort Paris Hong Kong Disneyland Resort Disney Vacation Club Disney Cruise Line Adventures by Disney Disney Regional Entertainment World of Disney Stores Disney’s Virtual Magic Kingdom Walt Disney Imagineering Consumer Products Theatrical Film Banners Walt Disney Pictures Touchstone Pictures Miramax Pixar Animation Studios Worldwide Theatrical Marketing and Distribution Buena Vista Worldwide Marketing and Distribution Miramax Buena Vista Worldwide Home Entertainment Buena Vista Music Group Walt Disney Music Publishing Walt Disney Records Buena Vista Records Hollywood Records Lyric Street Records Buena Vista Theatrical Productions Buena Vista Theatrical Group Disney Live Family Disney Merchandise Licensing: Entertainment Disney Toys & Consumer Electronics Disney Apparel, Accessories & Footwear Disney Food, Health & Beauty Disney Home Furnishings and Décor Disney Stationery The Baby Einstein Company Disney Publishing Worldwide: Disney Book Group Hyperion Disney Press Disney Editions Disney Libri Disney Adventures Wondertime Magazine FamilyFun Magazine Buena Vista Games DisneyShopping.com Disney Store Source: the company?s 2006 Annual Report

Table -1

Consolidated Statements of Income 2006

(In millions, except per share data)

Revenues Segment operating income

Media Networks $14,638 $3,610

Parks and Resorts 9,925 1,534

Studio Entertainment 7,529 729

Consumer Products 2,193 618

Total $34,285 6,491

Source: The Company?s 10-K report.(2006)

At 9:02am, May 2nd, 2006, as the 12-year old Emmalee Mason stepped into the Disneyland Springs, Colorado, perhaps the planet?s most lovable and joyful place, he was only too overwhelmed to hold up firmly the special wooden badge as the honorary two-billionth guest to visit a Disney Park. Little Mason is not the only one who has been longing for a ?fantasy trip? to this wonderland; one of the most popular wish among the world?s children ,as well as adults, is reported to be a visit to either Disney World or Disneyland. What is the real magic then? How could this time-honoured ?fun factory? manage to maintain its happy faces while expanding its universe and become more and more influential yet dominant? Of course it cannot simply be the magic, as portrayed in colourful Disney stories; itself, the super Disney empire, is the product of the one of the largest media and entertainment corporations in the world, the crystallization of the more concentrated operating formations under the increasing convergence across industrial lines via multinational conglomerates during the past few decades, a non-isolated success achieved not under one or more mythical ?great man?, but indispensable of both historical and technological inevitability.

From Obscurity to Fame

Officially formed on 16 October 1923, the Disney company was rather a small studio where since then Walt Disney and his brother Roy Disney started producing today?s household Mickey Mouse cartoons. In order to survive in front of the big five corporation giants who controlled the film industries at that time (Fox, Paramount, Loew?s, RKO, and Warner Brothers), in 1936, Disney reached an agreement with one of them, RKO, who then gave Disney?s short subject films exposure through a network of first-run movie theatres from New York to Los Angeles. Accordingly, throughout the 1930s Disney began merchandising its cartoon characters through a contract with the George Borgfeldt Company, which manufactured and sold the items, thus Disney?s Mickey Mouse image was branded on an array of children?s household items, such as blankets, lamps, toothbrushes, watches, alarm clocks, and so on (cited in Giroux 1999, 32; see also Cross 1997). Thanks to the international distribution of Disney films and this merchandising efforts with them, the image of Mickey Mouse bloomed to be a global phenomenon by the mid-1930s (Wasko, 2000). Besides, it is also in this period, in the year 1937 that the first full length animated film of Disney, ?Snow White and the Seven Dwarfs? was released, which became an immediate hit and to a large extent, was due to its pre-release merchandising campaign such as Snow White books, Snow-White-print corsets, Snow White sliced bread and Snow White sliced bread. These types of arrangements led Klein (1999) to credit Walt Disney as “the grandfather of modern synergy” and the Disney company as one of the prominent and most significant “branding trailblazers,” as all the other modern “superbrands” (e.g., Nike, Gap, Martha Stewart) are “exporting Walt Disney?s synergy principles” and transplanting them into every aspect of mass culture (pp. 145, 146).

However, just like other capitalist operations, Disney also had its ups and downs, especially the bitter labour strike declaring the end of the ?Disney?s golden age? (Wasko,19) and the loss of foreign market resulting from the World War II in the 1940s, during which governmental subsidiary served to keep the studio alive, when the company devoted to productions of a large number of government films. It was until the early 1950s did the company begin to recover from the war and made

necessary adjustments to a diversifying media entertainment market which ultimately sustained its enduring prosperity in the next few decades. Perhaps, the most significant extension of the Disney brand occurred in 1954 with the development of the Disneyland theme park which is said to be the real start of the company?s synergistic strategies and tended to ?recycle? the characters and brands that Disney had previously created. (Real 1977, 79; Grover 1991, 8; Gomery 1994, 76; Wasko, 2000,21). In addition, the Buena Vista Distribution Company was also formed in 1953 to act as the company?s own film distributor and started to promote its products globally , as an echo of Walt?s lesson of ?never lose control of your creation? (Wasko, 9) ,which signalled the Disney transition from cartoon-makers to one of the most powerful media conglomerates and most recognized corporate brands in the world. After Walt?s death in 1966, the company experienced another decline in its operating history and did not conduct a good business due to the separated block of interest and shareholders, which virtually led to the significant ?management shuffle? and emerged the ?Team Disney? when Michael Eisner, former head of paramount ,was appointed the new CEO and began building a media/entertainment empire after the takeover by the Bass Brothers Enterprise completed in 1984, with around 25percent of the Disney stock (Wasko, 32). However, Disney?s biggest move was the acquisition of Capital Cities/ABC in 1995, which gave the company ownership of one of the premiere broadcast networks, including ABC News, as well as popular cable channels, such as ESPN, a merger the entertainment industry pronounced “a marriage made in heaven” (Gibbs 1995, 24), together with the momentous purchase, it also occupied its role in the new media, and meanwhile launched the Disney.com in 1996 as well as its other media holdings (Disney.com, ESPN.com, ABCNews.com, etc.) and web sites. Besides, Disney even bought major sports franchises during the 1990s, including the National Hockey League?s Anaheim Mighty Ducks (sold to local philanthropist 2005), a spin-off of Disney?s Mighty Ducks movie, and Major League Baseball?s California (now Anaheim) Angels (sold to Phoenix 2003). This heralded that ,for Disney, the 1990s was going to be the Disney Decade with bouncing revenue growth and various complete strategies concerning corporate partnership (sponsorship with AT&T, Exxon and General Motors in theme parks, cooperative relationship with McDonald?s, etc), diversified expansions (even targeting the internet), corporate synergy (the ABC, and ESPN brands linked under the endeavour of Disney brand) , constructing the Mouse House into a diversified and profitable media and entertainment giant.

Today Disney represents a dominant player in the media and entertainment business, in addition to Disney's $2.1 billion consumer products arm, the $34 billion company has four major divisions: a movie studio ($7.5 billion in 2006 sales), theme parks ($9.9 billion), and the media networks ($14,6 billion), including the ABC broadcast network ($5.9 billion) and cable television holdings like the Disney Channel and ESPN ($7.3 billion), among which the last sector occupies the largest profit in total (Table1). As what the recent president and CEO of the company, Robert Iger quoted in the 2006 Annual Report that what is central to the Disney legacy is the ?unparalleled heritage of creative excellence, endless imagination and technological innovation? which is truly accomplished through the Disney ethos of ?Disney synergy?, the phrase typically used to describe the essential content in cross-promotional activities. (Wasko,2000,online). One of the first indications of the new innovative regime was a deal with Apple Computer to offer downloadable versions of ABC's hit TV series Desperate Housewives on the video iPod for $1.99 an episode, where in contrast to Eisner?s hesitance , Iger plunged into digital distribution ,forged a

close cooperation with Steve Jobs and bought Pixar out, putting Jobs on Disney's board of directors and making him Disney's largest shareholder, with a 7 percent stake in 2006. Accordingly, Iger continued to point out that this tremendous move ?enhances Disney?s position as the worldwide leader in quality family entertainment, [helps us to] remain at the forefront of technological advancement for the purposes of both entertainment and distribution, and the focus on expanding the breadth and depth of all our businesses globally.?

Yet, this is still not the whole picture of such a prominent media/entertainment mogul which has long been cherished for its innocent and pleasurable productions, as Graham Murdock has argued, in order to understand the full dynamics of media corporations, it is essential to use both approaches of instrumental and structural analysis so as to examine ?the complex interplay between intentional action and structural constraint at every level of the production process?(1982). It is time for the magic to be discovered.

The Magic

As Klein (1999) has explained, the process of branding entails marketing a brand “image” or “identity” to separate one product or service from its competitors. Disney has been able to set itself apart from its competitors in the media industries by promoting quality, wholesome, family entertainment through its charming animated cartoon characters and sentimental storylines. Moreover, as obtained from the history of Disney, it is self-evident to say that synergistic practices have long been used to spread the company?s brand image (see table 2) and Disney has done more than just advertise its merchandise through its various corporate arms. For example, through the horizontal development with the interface of its media networks, especially the TV and cable sectors, not only did it harvest the largest proportion of the total revenues (see table 1), but also it made itself a justification for the resource-based view of the firm (RBV),which brings it the competitive advantage in that ?whatever its source, ultimately can be attributed to the ownership of a valuable resource that enables the company to perform activities better or more cheaply than competitors? (collis,D). It is the same case with Disney?s acquisition of ESPN, which the logo itself reduced the need for advertising, since the recognizable name and the ability to cross-promote the restaurant/bar via live remotes for ESPN programs such as NFL Primetime could devote highly to its reduced cost on extra manufacture. Actually, most of the company?s product are the conglomeration of such transferability within different sectors thus diversified to its utmost in order to exploit as much the prolonged life of a cultural product as possible. The theatrical releases of The Lion King, the newly vows with Apple, etc., are all cases of such strategies.

What?s more, a highlighted interest of global promotion is another master card for the company to strengthen its empire all over the world, as one could tell from the stages of the different Disney Resorts collectively set their feet in Japan, Paris and Hong Kong. These artefacts maximize the recycling effects upon Disney?s classic characters as well as newly invented ones to feed the frenzy meanwhile maintain its heritage and pass on to the next ten years? new generation around the world (Wasko,2000). What may also originated from the wonderland of Disney is this growing sense of globalization/fragmentation dialectic that defines their existence through the company?s mixed strategies of mass expansion and niche marketing ,as shown by the TV series of Weddings of a Lifetime based on the exterior of the Disney wonderland , the Celebration as well, aiming to redraw young adults into the Disney

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