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Mickey Mouse in the Communist Kingdom

What happens when you combine an iconic American brand with potentially the world’s biggest market?

by
Gordon G. Chang

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November 9, 2009 - 12:09 am
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Has Mickey gone goofy?

Beijing on Wednesday announced its approval of a Disney theme park in Shanghai. The attraction, in the works for 19 years, is scheduled to open in 2014. The site is slated to be about 1,000 acres with the actual theme park to take up around 100 of them. That would make the much-anticipated attraction a little larger than the original in Anaheim. The cost of the venture is estimated to be $3.5 billion.

So what happens when you combine what is “perhaps the most iconic American brand of all” with potentially the world’s biggest market? Most people would say a sure-fire way to make money. Money will undoubtedly be made — but maybe not by Disney.  As Yin Kunhua, a professor at Shanghai University of Finance and Economics, said, “It is difficult to say what the exact impact will be, but this can only be good news for Shanghai.”

Shanghai will surely benefit, boosting revenues from tourism, triggering growth in areas surrounding the park, and enhancing its position in its never-ending competition with Beijing. Disney, however, is another story. On the plus side of the ledger, the park will add to its profile in China and should help its other lines of business, such as the chain of language schools and its now-limited television programming. The park could do well too, with some 300 million potential visitors living within two hours of the site.

How Disney will actually do is an open question, of course. For starters, the theme-park business in China is generally troubled.  There are already 2,500 of these attractions in China, with only about 10 percent of them making money. Many have already failed. Froebelland Park in Wujiang, for instance, closed its gates in less than a year. And one attraction shut down before it even welcomed its first visitor. That was Love Land, China’s first sex-themed park, in Chongqing, technically the world’s largest city.

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