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I'm sure Disney is as good with financial modeling as any Wall Street firm. If they have responsibilities for things like water/sewer because they were an extr
by jleyank 5y ago
I'm sure Disney is as good with financial modeling as any Wall Street firm. If they have responsibilities for things like water/sewer because they were an extra-governmental region, why would they not try to drop them like a stone if this was removed? Private companies aren't responsible for water, sewer, fire, police, ... all of the things needed to keep the peace. It's not like private companies are nice, friendly things, and The Mouse has been more company-like than most.
Also, they have to do a determination on stay/go. Do they put more $$ into Florida or not? Is there a marketing risk operating there vs. not? Is there a business risk mucking about with theme parks or are they a 20th century phenomenon. Is expansion in the US the way to go or outside the US (Hard Rock Cafe voted for the latter a decade or more ago)? Which customer base has more disposable income that can be siphoned into the Mouse's pocket?
If their tax position changes, the financial benefit changes. Given the push for unionization that is occurring (Starbucks, Amazon), it might not be worth pissing around with lots of (formerly) cheap labour. If their bonds or bottom-line is significantly affected by such a change, they'll have to act quickly to avoid Netflix-like damage.
Or, all of this is BS, they hunker down and hope it passes in a year or two. However, it's been building up for 5-10 so far so that's probably naive. They can try funding the opposition, but that presupposes that there is a viable opposition in Florida. Disney Orlando requires tourism going to Florida to generate revenue, so they're damaged by stuff outside their control - people can get their mouse fix anywhere. And if the current Florida administration wins, the next round will be worse.
So, unless Disney really goes along with what's going down, they're in an unenviable position. Losing control of the marketing and ending up as Hillbilly Heaven would hurt them bad outside the US.
- colburnmh 5y agoBecause, unlike most businesses, Disney's park straddles two different counties (Orange and Osceola). Therefore, they have to deal with two different counties to get anything done in a consistent fashion. Further, by having control of their own infrastructure, they can control the standard of quality. Pass that to two different counties, and some of the differences between how the counties are managed will start to affect Disney's business. Image part of the park losing power due to one county deferring maintenance on their power grid, etc. Part of the "magic" of Disney is that they get to control the experience from road maintenance to providing power to the park. Now that control will move to the counties with no guarantee that they will continue to provide that infrastructure to the same standard as Disney currently does.
- pyuser583 5y agoBut that “magic” is because of legal arrangement only Disney has. At the least, aren’t there anti trust issues here? If other investors wanted to create a Disneyworld like park - they couldn’t. At the very least they’d have to spend lots of time and money getting zoning approval.
- beerandt 5y ago>two different counties This was a hedge done on purpose, so that (among other reasons) they wouldn't be 100% at the mercy of a single governing entity. There's a loss of consistency between the two, but that's a feature, not a bug. If one county doesn't cooperate with what's needed for, eg, a new park, Disney can threaten to put it in the other county instead.