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Comment by rabuse | Hacker News Reader

This may hopefully improve the quality issues their parks have been facing while under Chapek's "penny pinching" ideology.

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Bob Iger has had a lot of vanity projects over at Disney. The amount of debt that was put on after Disney acquired Fox (and not even all the parts they really wanted - Comcast got that!) is pretty high.

A good overview can be found on this video essay: https://youtu.be/w-4k9c8LZU4?t=377

Disney's long term debt for 2020 was $52.917B, a 38.78% increase from 2019.

Disney's long term debt for 2019 was $38.129B, a 123.19% increase from 2018.

https://www.macrotrends.net/stocks/charts/DIS/disney/long-te...

Yes, Disney is slowly throwing money at the problem and reducing it's debt, but it's still a pretty high load.

Still not as bad as Warner Bro's Discovery though.

Warner Bros Discovery long term debt for the quarter ending September 30, 2022 was $48.612B, a 236.74% increase year-over-year.

https://www.macrotrends.net/stocks/charts/WBD/warner-bros-di...

The acquisition of Fox assets dwarfs Disney’s previous acquisitions of content:

  2019  $71.3 B for 21st Century Fox
  2012   $4.1 B for Lucasfilm
  2009   $4.2 B for Marvel
  2006   $6.3 B for Pixar

As well as Disney’s other billion dollar acquisitions:

  2016   $2.9 B for BAMTech
  2001   $2.9 B for Fox Family
  1999   $1.8 B for Infoseek
  1996  $19.0 B for Capital Cities/ABC

https://en.wikipedia.org/wiki/List_of_acquisitions_by_Disney

Bob Iger must have been eager to bulk up before the launch of Disney+?

Which is understandable. 21st Century Fox was a much larger company than any of the other three mentioned companies - with sales offices, distribution deals with other studios, physical movie studios, large television production units (especially that output content in the UK/AU).

21st Century Fox also owned the rights to hundreds of movies (Avatar, Alvin and the Chipmunks, Dr. Seuss) and plenty of television (1/3 of Hulu, The Simpsons).

They also had the movie rights to some of the Marvel characters. I don't know how much that was worth to Igor, but it seems that he really wants to get the family all back under one roof.

It's interesting that you mention the ABC acquisition - in today's money that would cost $36.09 billion - just roughly half of the Fox acquisition.

Remember Toys-To-Life?

https://en.wikipedia.org/wiki/Toys-to-life

I wonder if that was Bob Iger. Or maybe he was smart enough to dump it.

In terms of annual revenue, Disney has $83B against $29B for Paramount Global, $30B for Netflix, and $13B for Warner Bros Discovery. So Disney's debt is 0.6x revenue while Warner Bros Discovery's debt is 3.7x revenue. If Disney's debt is a problem, WBD is drowning.

What did Comcast get other than the 39% of Sky that Fox owned? The Fox Sports RSN went to Sinclair.

I can appreciate the issues around debt, but Disney also acquired a huge amount of IP and market control in entertainment in the deal. They've left the Fox broadcast networks without a TV studio for their content (and first-run is becoming less important in the era of streaming). They've gotten so many of the most important IP franchises out there. They've become by far the largest movie studio. In an era where entertainment is becoming vertically integrated from creation to streaming, it seems like Disney has locked down so much of the future.

We see how others are struggling. Paramount is trying to make the most of Star Trek and is the smallest major movie studio. Warner Bros Discovery is an also-ran with HBO Max - and having trouble figuring out the way forward with HBO Max/Discovery+/(the canceled) CNN+. WBD is also struggling with many of their franchises fizzling out: the Harry Potter/Fantastic Beasts universe is mired by JK Rowling's problematic politics and Ezra Miller's many issues; they seem to be having trouble getting their DC properties to perform how they'd like having canceled Batgirl when it was almost finished and talking about refocusing the franchise. Sony is an independent studio, but lacks the integrated platform that the other 4 have. Comcast/NBCUniversal is still trying to figure out what Peacock is and having trouble even attracting free users.

Iger talked about making the call to buy the IP needed to really create a vertically integrated company that would be able to support a streaming service without licensing lots of outside content. It started with Pixar, Lucasfilm, and Marvel who gave Disney a huge amount of content and talent. Fox was expensive, but also gave Disney the rest of the Marvel universe (except Spiderman) along with so much more content and a huge amount of control of the box office and TV. Disney is in a very strong position relative to their competitors. I think Disney is going to look pretty good in a decade. The economies of scale of running a large streaming service seem likely to help Disney a lot (having many more customers paying for the same content and allowing you to afford more of it). That's not to say Paramount, WBD, and others can't compete, but it does seem like Disney owns so much more which lets them offer more and secures their position. People got Netflix because it offered more and it's hard to see how Paramount or WBD or NBCUniversal could offer as much as Disney could. Now, Disney will try and figure out what the minimum it can offer while keeping users is, but they have such a depth of content that it puts them in the driver's seat a bit.

Netflix always knew it was a matter of time before the giants understood streaming was the way and changed their business models.

What they didn’t expect was Iger - figuring out the model - building a good streaming app - buying up all the could. Truly a high performance CEO imo and one of the best in the history of entertainment.

It’s funny to read in the biographies of S. Jobs just how blown away he was by Disney’s institutional knowledge of marketing when he got into bed with them with Pixar. From the bios I read I remember it was the first time he realised you could make an effective corporate culture last - Disney will soon be around a century old.

How was Disney able to build a streaming app as good as Netflix, which is supposed to be filled with extremely well paid and presumably, extremely qualified people? I had a friend interview with Disney+ recently and the salary wasn't that good.

It involves the Major League Baseball! Disney+ was created with the technology that was used to stream MLB games.

Disney acquired 75% of BAMTech Media for $2 billion.

https://en.m.wikipedia.org/wiki/Disney_Streaming

I think HBO has shown us that you don't need a streaming app as good as netflix, people just need to be able to watch your content. If you have the content people will pay to stream it.

The quality of the streaming app just has to pass a relatively low bar. It just needs to work tbh. The content is king.

It could be they just hired extremely competent people to build it, outsourced?

Thanks for this.

I dont have the historic knowledge of the parks change but I have been often in the last years as a friend of mine has employee passes. I found them to be exceptionally clean with friendly staff. Leagues ahead of other parks.

By far the worst part of the experience was that it was too crowded. Raising prices or limiting annual pass holders would help solve this but I feel like that falls into the penny pinching category. Lower attendance cap would also help but would be surprised if they did that given it is capping your income.

Starting to charge for parking at the resorts, continuously increasing food prices, still requiring park reservations, and the virtual queue[0] are some of the biggest downsides of the past few years attributed to Chapek.

0: which was instated to prevent 4+ hour wait times for Rise of the Resistance

It just seems like these complains have a "Its too crowded no one goes there anymore" vibe. I feel like maybe the nickel and diming is not worth it - but fundamentally it seems like they need to lower the daily attendance and probably the easiest way to do that will keeping income stable is to raise ticket prices.

Gee, if only someone had an unbelievably massive amount of land in Florida, and Long Beach, with which to open a new gate.

I mean other than universal

I do think this is the best option. Disneyland is cramped but it appears they will be given land to expand soon.

I think they are worried a third US park would eat into the brand - but have always been a bit surprised they haven't tried to do one in Texas. There is a lot of land there that is cheap and geographically could serve different audience.

You don't even need to do that. A gate can be in Anaheim or in Orlando (or both), It doesn't require a new location.

Disney is already freeing up more space in Anaheim, and they still (aFAIK) have a huge interest in land around long beach (a bit more problematic). And they have huge tracts of land in Orlando.

Where are you seeing the Long Beach stuff? I know they once thought about opening Port Disney but as far as I can find that land was given up almost two decades ago.

The Anaheim expansion is limited. They are pretty much just taking over the parking lot. The city council has made it very difficult (fair enough) to just expand onto property they already own so I imagine an expansion into land they acquire would be even more challenging

I don’t think it will since a lot of these changes were started under Iger. Chapek became CEO at the worst possible time and had to deal with park shutdowns and staffing issues. Of course there were going to be service cutbacks. My visit last weekend was markedly better than the week prior etc.

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