In 2006, Disney continued to benefit from its ongoing effort to develop and grow international markets. The role of Walt Disney International in this effort is multi-faceted: ensuring the Company’s brands, stories and characters are increasingly familiar in international markets; creating locally relevant product; exploiting new technologies; and leveraging economic and infrastructure growth around the world.

To accelerate growth in the emerging markets of China, India, Russia, South Korea and Latin America, Walt Disney International has organized these territories under five managing directors, each with full operational responsibilities. In the more developed markets of Western Europe and Japan, Walt Disney International has created regional and in-country steering committees, consisting of business unit heads to facilitate development and execution of Company-wide initiatives.

Significant achievements have already been made this year within emerging markets. The Lion King stage play opened at the Shanghai Grand Theatre, delivering a new level of Disney entertainment to China. Rich, immersive content such as The Lion King is integral to building brand awareness in these markets. For this reason, shortly after the Company opened its first office in Russia, a Cinderella Ball was held at the Kremlin Palace – attended by 800 little princes and princesses – to coincide with the television broadcast and DVD release of the classic Disney animated feature.

In India, Disney acquired the leading Indian children’s television channel, Hungama, as well as an equity interest in UTV Software, an integrated media company specializing in Indian filmed entertainment and television production. These investments have accelerated the Company’s presence in a market where local content is king.

Looking forward, the team in Russia will seek to expand Disney’s presence on television to further build the brand while leveraging the growth of the retail, theatrical and new media sectors with innovative content. In Latin America, where significant inroads have already been made to establish Disney’s core businesses, the Company has tapped into the immense local content market by producing local versions of High School Musical and Desperate Housewives. Together with the impact of assertive strategies in developed markets, these initiatives are designed to encourage strong overall growth for Disney in international markets.