An outstanding threat occurs from strong competition

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An outstanding threat occurs from strong competition from many other companies in relevant segments. Some of these competitive forces to Disney in terms of theme parks are Six Flags, Universal Studios, Knotts Berry Farm, Sea World, and Busch Gardens. In studio entertainment Disney faces opponents such as Time Warner Inc. Also, in media networks NBC Universal Media LCC and News Corporation are major competitors. Disney has to keep being aggressive in each of these markets in order to stay as one of the top contenders. As well, the broadcasting services compete with other networks, cable companies and DVDs in order to compete for viewers and advertising dollars. Piracy is also a rapidly growing problem that leeches from profits. People now have more readily available sources to download content off the Internet illegally and bypass sales. This is a dramatic threat because it cuts into revenue yet the product is being delivered by unauthorized methods. In addition, natural disasters pose a threat for Walt Disney, for example, the earthquake that struck Japan on March 11, 2011, affected the Tokyo Disneyland and Tokyo Disney Sea that were closed in order to evaluate the parks for any damage. Closing the parks causes a loss in potential revenue as well as the costs in damage that Disney would have to pay in order to repair the parks to get them back into working form. (BusinessWeek, 2011) Because California is located right on the Pacific Rim of Fire, there is a potential threat for an earthquake to occur in this location as well. This could affect many of the theme parks that are located in California State. As Disney continues to globalize they will also need to pay close attention to laws and regulations within the new countries that they expand to. Depending on the countries, they may not have the opportunity to operate in ways they’ve gotten used to in the past. As expansion is carried out into the mainland of China, close attention must be given to their laws. Disney will have to pay particular attention to safety regulations in particular as they expand abroad. If the Walt Disney Company can keep a close eye on the dangers that could possibly harm the company, they will be able to avoid any setback that should get in their way. As well, changes in consumer preferences can also cause a threat for Disney business in regards to people losing interest in vacationing on Disney cruises or visiting Disney theme parks. People may shy away from the Disney experience for reasons such as cost or disposable time that people may not have and thus it is Disney’s job to constantly develop new products in order to maintain the customer’s attention and keep them buying Disney branded products. The recession can also affect consumer preferences in regards to people not having as much disposable income to spend on vacationing or going to the movies. People are being more contentious with their money and activities such as movies, purchasing Disney products or going to Disneyland may be put on the backburner until the economy starts to redeem itself.

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