Disney Expansion into Asia

When Disney considered expanding its theme parks internationally, they were interested in several key components which could increase the likelihood of success. A sizeable enough population to sustain the entry, economic factors of the population which would allow them to afford to visit and enjoy, sufficient infrastructure to support the necessary visitor numbers, climates which are conducive to the theme park environment, and governments willing to negotiate the terms of ownership. Tokyo Disneyland was successful from the beginning, but Disney shareholders did not reap the best return on their investment because the terms of ownership established The Oriental Land Company as the single owner of the facility, with Disney’s income stream derived from only from licensing fees (Lopez, 2002).

When deciding to make its next foray into international expansion, Paris was chosen over a location in Spain because of the ownership issue. Disney was able to negotiate a 49% ownership interest in Euro Disney and opened its location outside Paris in 1992 (Lopez, 2002). It is important to note that Euro Disney did not realize the same level of financial success as Tokyo Disney, largely due to the economic stresses of the time. Paris had more available land than did Tokyo, but Tokyo had more population in a compressed area than did Paris.

When Disney began evaluating an entry into China, Shanghai and Hong Kong were both in consideration. Hong Kong prevailed because of the presence of significant infrastructure and international tourism to support the endeavor (Lopez, 2002). Hong Kong Disneyland opened in 2005. Revenue in the fourth quarter of 2011 was $10.8 Billion (BBC, 2012).

If I were the CEO of Disney, I would consider India, Africa and perhaps South America (Brazil or Argentina) as potential locations. Each has a sizeable population and is experiencing increases in economic growth, particularly India. I would consider India first, South America