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Here’s a quick rundown of some of the other investments in
our Disney brand that have been made:
• Since 1996, we’ve grown the Disney Channel from 15
million subscribers to more than 80 million. Internationally, we’ve
nearly tripled our Disney Channel subscribers from just two channels
in Taiwan and the United Kingdom to 18 million households, with
12 distinct channels reaching 55 countries.
• Toon Disney launched just four years ago. It is already
in 34 million homes. Next up in our growing suite of Disney cable
properties is Playhouse Disney, to be born out of a programming
block that we’ve incubated on the Disney Channel over the
past several years.
• Radio Disney, launched in 1997, is now heard on 51 stations
in nearly 60 percent of the country.
• Disney Theatrical Productions has gone from one show –
Beauty and the Beast – to four shows that can be seen
in 16 productions in nine countries.
• Disney Animation has released 13 animated sequels theatrically
or direct to video since 1994. Combined, these pictures are expected
to contribute profits of approximately $1 billion over their lifetime
as well as generate significant double-digit returns.
• Disney Internet Group has established relationships to
provide Disney-branded content to 22 major cellular telephone carriers
in more than 20 countries around the world, including Japan, Taiwan,
Germany, the United States and the United Kingdom. In the fourth
quarter of 2002, the Disney Internet Group became one of the few
Internet operations to be actually profitable. It has also embarked
on an exciting new partnership with MSN.
• In Florida, we launched the Disney Cruise Line, which has
an operating profit per passenger day that is among the highest
in the industry and which generates some of our best guest-satisfaction
ratings.
• Disney Consumer Products has developed the innovative Princess
line of merchandise, which has gone from $100 million in retail
sales in 2000 to $700 million in 2002.
• The Walt Disney Studios has broadened the audience for
Disney live-action films with hits like Remember the Titans,
The Princess Diaries, The Rookie and The Santa
Clause 2.
• We have reached an agreement with Bank One and Visa to
issue an innovative new credit card that will give cardholders the
ability to accumulate Disney Dream Reward Dollars that can be redeemed
for practically anything at Walt Disney World, Disneyland Resort,
Disney Cruise Line, Disney Catalog, the Disney Store and DisneyStore.com.
• And, around the world, since 1996 we have opened four new
theme parks and added 8,500 hotel rooms, with 115,000 square feet
of convention space. Today, Walt Disney World is the number-one
tourist attraction in North America; Disneyland Resort in Paris
is the number-one tourist attraction in Europe; and Tokyo Disneyland
Resort is the number-one attraction in Asia.
Just as we have expanded the Disney brand, we have worked equally
hard to build ESPN’s market position and brand power. To fully
appreciate ESPN’s strength, consider the fact that more than
87 million Americans aged 12-64 watch, listen, read or log onto
ESPN-branded media in the average week, representing 44 percent
of all people 12-64. The average American spends 43 minutes with
ESPN media (TV, magazine, Internet or radio) in the average day.
Male sports fans on average spend an hour and 44 minutes with ESPN
media each day – 2.4 times that of the average person. Here
are some of the things we’ve done in the last few years to
make ESPN such a powerful presence in our lives:
• In 1996, ESPN had two domestic channels. Today, there are
four ESPN channels and the subscriber base has grown by tens of
millions. ESPN International now reaches 119 million homes in 140
countries and territories.
• ESPN.com is the leading stand-alone sports site.
• ESPN The Magazine, launched in 1998, reaches 2 million
readers worldwide, representing growth of 370 percent.
• ESPN Radio, launched in 2000 with 175 stations, none of
them full-time, has grown to more than 700 stations, including 215
affiliates broadcasting ESPN 24 hours per day.
• ESPN has developed the X Games and has helped popularize
the Skins Game.
• Toward the end of 2002, we announced the launch of ESPN
Deportes, a 24-hour, Spanish-language sports network scheduled
for the third quarter of 2003, and ESPN HD.
What these expansions and investments in Disney and ESPN have in
common is that they all build on the uniqueness and relevance of
these brands. In so doing, they have created a protective moat around
these assets. In the case of the Disneyland Resort and Walt Disney
World, the moat is literal as well as figurative; but in every case,
these assets are safer and more secure so they can thrive in the
years to come. Of course, we have businesses outside of Disney and
ESPN. But they really must be considered in the context of these
two main brands.
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