Eurodisney

Explain why Disney chose to enter Europe through a combination of joint-venture, a licensing contract, a management contract, and various other agreements with the French government and with lenders.

Disney forget the path of the theme parks in the world, and created a business around the idea of integral entertainment.

For its first park, the one in Los Angeles, Disney partnered with ABC, giving them 34.48% of the shares. For the next Disney World Park, in Orlando, Disney decided they want to have absolute control over the business. For the next park, Tokyo Disneyland, Disney went to a partnership with OLCL, who would be owning and operating the park, while Disney would be making money out of the royalties for concept of admissions, trademarks, etc.

When Disney noticed the big success the 3 parks had, it seemed natural to open another park, more precisely in Europe, to satisfy the European demand. When the decision of making the park in Paris, France was made, the government supported the idea, especially because of the employment boost it will bring to the city.

For Euro Disney, the approach was different than with the previous parts. In this case, they decided to keep the control of the management and operations, giving to the investors, majority of the ownership and to the banks the financing responsibilities. The first different thing they did was the creation of Euro Disneyland S.C.A. to build and own Euro Disneyland, with Disney owning 49% of it. This company was managed by Euro Disneyland S.A., a subsidiary totally owned by Disney.

Additionally, EDL Holding Co., owned totally by Disney, was the shareholding company of Euro Disneyland SCA, and it owned EDL Participations SA, acting as Disney's partner. Also, Euro Disneyland SNC, owned by Disney and French corporations, was formed to buy the park facilities.

This approach allowed Disney to minimize the risks that could arise from this new endeavor, while at the same time gave them control of the park and the possibility of get good financial returns. With the experiences in Los Angeles, Orlando and Tokyo, Disney found that with a mix of different approaches, they would be able to still have control of the management of the park, guarantee the quality and the "Disney experience" to the park's visitors, minimize the risks, and have an opinion on how the park was going to be handled, among others.

How do you think that Disney’s experience with Disneyland theme parks in Japan and France influenced its ownership and management arrangements for Disneyland Hong Kong?

The first element to consider for Hong Kong, would be the cultural element. Taking into consideration what happened in Japan and France, it would have been cautious to analyze what aspects of the American culture and the Chinese culture would have to be included in Disneyland Hong Kong. Especially considering the Chinese culture and its strong traditions. While in France and Japan there were mixed feelings on how much of the American culture should be reflected in the park, it's very likely that for the park in China, the focus should have been more focused to appeal the Chinese people by merging both styles, but giving priority to their own preferences.

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