Disney Continues Overseas Expansion

This has been sitting in my draft folder for sometime and even though the transaction is a little older now I believe, it just showed up again at Google’s finance page as a news link on Friday.

For most of use when we think of overseas expansion for the Disney Company, we tend to focus on the theme park business.  After consideration for that, we might move on to the Studio’s of course, since today (just like in Walt’s early days I might add), the studio relies just as heavily on international receipts as it does domestic ones. 

I think most people stop there in general.  Maybe that’s because the studio and the theme parks were the core of what Walt created.  Maybe it’s because they are the parks that so many people remember growing up with and therefore are the most nostalgically attached too.

Sure, there is Consumer Products.  But let’s face it, we are so used to going to Wal-Mart, Sears and other outlets and seeing Mickey and Pals on everything from house wares to underwear that DCP I think get’s short shrift.  That despite the awesome job that they do.

And there is the Internet Media Group (DIMG)… which has risen from the ashes of the almost disastrous ‘go.com’ days.  Still not sure what Michael Eisner was thinking on that one…

I feel the most massive part of the company though is still out of limelight a lot, or at least as a single entity anyhow.  I think people focus on Media/Networks through the lens of the individual brands more than as a portfolio of inter-related products.  There are no castle’s, huge tent pole summer blockbusters or other tangible things that people can wrap their head around to associate many of the media parts with one another in the same way… and yet that’s exactly what Disney does.  They manage media as a portfolio of assets, on a GLOBAL scale.

Walt knew that effective advertising was on of the key’s to the company’s success.  Much has been written about the irony of the deal Walt cut with ABC that ultimately gave him much of the funding he needed to build Disney World and that today the Disney Company owns Cap Cities/ABC.  It’s a good thing too, or we wouldn’t have some of the great talent in the executive suite that the modern day Mouse Company offers.

So given that the P&R, CP and Studio’s division of the companies in many ways already have worldwide penetration.  Disney still lacks the same scope and breadth in media networks.  Which is why I think Disney has continued to do just that.  They own major stakes or have long term deals with media networks in China, Russia, Europe and now India through the recent acquisition of almost 60% of UTV Software Communications.

UTV bills itself as ‘India’s first integrated global and entertainment media group’. Sounds a bit like a Media/Networks portfolio for India no?

Which is why it should be no surprise then I think that Disney continues to expand their media network reach through quality local providers vice building it themselves (and running a high risk of getting it wrong).  It should also come as no surprise that because of this ownership, Disney has a seat on the board of UTV as well.

If you are going to be a global company, then you need to have a plan for ALL your major businesses to be global.  And that’s just what Bob Iger and Andy Bird (the head of Disney International) have been up to I think.  Global reach.  So just like in Walt’s days, when the market is doing bad in one economy, hopefully it’s doing better in another (the current mess excepted). 

Disney’s stock price has made a nice little rally this last week to boot.  It’s still WAY off it’s 52 week high in the mid-30’s, but it’s also up quite a bit from being in the high teen’s.  If you’re looking to invest in Disney shares, now might be a good chance to get in.  With gas falling, that HAS to be good news for the domestic parks.

Disney has a pretty good investor direct plan that you can use for very cheap.