Businessweek recently conducted an interview with Disney CEO Bob Iger during which the recent extreme makeover of Disney California Adventure was a centerpiece. What I found interesting about the interview was how candid Iger was about some of the things went wrong with the original version of the park.
“Like all of our parks, this one was a work in progress. In this particular case, there was a lot about it that wasn’t working,” Iger said. “We probably underestimated how much people would demand Disney when they come to a park that has the Disney name on it.”
Iger also discussed the recent large amount of capital expenditures by the mouse house, “in the last five years, we’ve built two billion-dollar ships. We opened this. We committed to building Shanghai Disneyland. We opened a $900 million resort in Hawaii. We made a decision to build a new Fantasyland in Florida. We’re expanding Hong Kong Disneyland by about a third of its size. It may seem counterintuitive, but building in the downturn turns out to be a great thing because costs are lower. You don’t have as much competition for labor or material.”
Add up all that money and I have to believe the Disney CEO when he says we’re coming to the end of large expenditures on capital improvements. At least for a few years. I think park fans should be prepared for a couple years of not much going on out west and only Avatar out east.
That doesn’t mean that Disney won’t be spending money on its parks, it’s just that it will go into things like entertainment (parades and shows) and personnel.
Read the rest at BusinessWeek.