Kenversations™ - Feb 28, 2002

Kenversations™
Page 1 of 2

by Ken Pellman (archives)
February 28, 2002
Ken catches up on lots of recent news surrounding the Walt Disney Company.

Random Thoughts on the Passing Parade

Corporations Growing Larger
The international, corporate conglomerate behemoth now known as The Walt Disney Company had its genesis as the small Disney Brothers Studio. From producing animated and mixed live-action short motion pictures, it progressed to making feature-length animated motion pictures and diversified into live-action features, television programs, and Disneyland Park. Now, as you probably know, Disney has:

  • multiple film labels and libraries
  • multiple record labels and libraries
  • multiple literature publishing labels and libraries
  • multiple home video labels and libraries
  • Disney Interactive
  • magazines
  • other consumer products (toys, clothing, collectibles, art, etc.)
  • broadcast radio stations, networks, programs and libraries
  • broadcast television stations, programs, a network, and library
  • multiple cable television channels and libraries
  • major World Wide Web sites
  • hundreds of stores
  • time shares
  • Walt Disney World Resort and Disneyland Resort
  • partial ownership or licensing for resorts in Japan and France
  • a resort in China (Hong Kong) under development
  • a cruise line
  • a National Hockey League team and a Major League Baseball team
  • The Walt Disney Studios in Burbank (including Walt Disney Feature Animation), and other studios around the world
  • Walt Disney Imagineering (research, design, and development)
  • a stable of highly recognizable characters (which are used for Disney products or licensed for other products)
  • other properties I don't have time to detail here.

It is quite a company, but it isn't alone in size, diversification, or reach. Disney is considered one of the seven big Hollywood studios, joined by Warner Brothers, Paramount, Columbia/TriStar, 20th Century Fox, Universal, and MGM. I suppose DreamWorks will soon be listed in that group as well.

Every one of those studios is now part of a larger company. AOL/TimeWarner, created by the combinations of Time Life, Warner Brothers, New Line Cinema, Turner, and America Online (which bought up many well-known Internet-based properties) is gigantic. So is Viacom, which owns Paramount, MTV, Nickelodeon, CBS, Infinity Broadcasting, and much more.

These companies will likely get bigger if certain regulations limiting the ownership of television stations are eliminated or relaxed. The regulations prevent one company from owning enough television stations to cover more than a certain percentage of the U.S.A. Networks, such as CBS, NBC, and ABC don't own all of the stations their programming appears on - only a minority of them. Other affiliate stations are owned by companies large and small, mostly large companies these days.

Affiliates can and do switch networks sometimes.

Those ownership rules might very well be done away with soon, likely resulting in a flurry of purchases by large corporations.

Because of the international scope of business these days, laws and regulations of many countries have to be considered before mergers and acquisitions will make sense.

With cable, satellite, and various telecommunications mergers, there has been speculation that The Walt Disney Company could be a target for acquisition. The idea is that Disney could provide content for some very large merged company that would own the "pipeline" (a cable provider, for instance) the programming would be delivered on. For that to work, the company would have to have enough stock and/or cash to make the deal, and Disney stock would have to be low enough compared to the value of its assets. It wouldn't make much sense to buy Disney and turn around to sell off big chunks, because part of what makes Disney work is the synergy.

Disney is likely to be involved in buying. Which end of the transaction it will be on remains to be seen.

Corporations & Copyrights
While Disney wants some restrictions lifted, it wants others extended.

Copyrights are meant to reward innovation and creativity by allowing the creators of artistic works exclusive control over what they've made for a certain amount of time. After a while, their story, character, image, song, or whatever becomes public domain, allowing others to build on it or reinterpret it.

For instance, Hans Christian Anderson wrote The Little Mermaid, a story that entered the public domain, but Disney made the animated film based on the book, benefiting from access to the tale. Disney, though, and many other copyright holders, keep lobbying to extend the years a work is protected. Disney does it to keep control over such works as "Steamboat Willie" and characters such a Mickey Mouse.

Mickey Mouse has been around for so long, he was close to being public domain.

A character like James Thomas Kirk, however, has only been around for a much shorter time and won't face the public domain for a long time.

Some decry the extensions of protected time, arguing it is giving corporations too much control over our shared culture.

 

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