The 2 Key Decisions That Have Now Made Disney Unstoppable
With the simple release of a two-minute teaser trailer for a new movie, Disney was able to increase its market cap by roughly $2 billion. That’s not your average display of power. That’s the kind of muscle flexing that is only rivaled by companies like Apple or Facebook, both of which can stop people in their tracks with new product or service announcements.
Disney is ascending to “infinity, and beyond” having been led to God-like proportions behind two big decisions made within the last few years. Those two moves were the $4 billion acquisition of Marvel, followed by the $4 billion acquisition of LucasFilm, giving Disney a slate of entertainment juggernauts like the world has never seen before.
One company now controls the rights to the Avengers — including all the associated characters — the entire Star Wars universe, ESPN, ABC, Buzz Lightyear and Woody, Pixar, and has a distribution deal with Dreamworks. With an arsenal like that, it’s hard to think that Disney can be taken down.
Disney’s purchase of Marvel was completed in 2009 for cash and stock. The acquisition bought Disney the rights to a massive library of more than 5,000 characters, and at $4 billion, looks like a relative bargain.
“Marvel’s brand and its treasure trove of content will now benefit from our extraordinary reach,” Robert A. Iger, Disney’s CEO, told The New York Times. “We paid a price that reflects the value they’ve created and the value we can create as one company. It’s a full price, but a fair price.”
Considering that the first Avengers movie alone grossed more than $623 million in 2012, Disney effectively purchased themselves an ATM machine. That number is followed closely by others, including the Iron Man series, Captain America, and Guardians of the Galaxy.
The second and most recent moves was the purchase of Lucasfilm from creator George Lucas for another $4 billion, which handed Disney the reins to possibly an even greater universe. There hasn’t been a Star Wars film produced in a decade, and the last three were not met with much fanfare, but the original trilogy took the world by storm starting in 1977 and has had a huge following ever since.
With six movies having been released in the past 40 years, along with a ton of video games, books, and everything else you can imagine, clearly the Star Wars universe is a vein of platinum that can still be mined. Which is exactly what Disney plans to do, with the trailer mentioned at the beginning. The seventh Star Wars movie, called The Force Awakens, is already causing even non-fans to jump on the hype train. The entire Star Wars universe has been valued at as much as $20 billion, and you’d have to think it’s only going to go up from there.
Oh, and along with Star Wars, Disney gets Indiana Jones as well.
By adding Marvel and Star Wars to its already extensive holdings, Disney seems to have become invincible. No other entertainment company appears able to match Disney’s powerful lineup. The next Avengers movie will surely rake in hundreds of millions, the new Star Wars movie (scheduled for release in December) clearly has some fans frothing at the mouth — and let’s not even get started on Frozen 2.
Let’s be honest: Disney’s future is very, very bright. And the company has been able to all but ensure its success for the foreseeable future by making a relatively cheap investment in Lucasfilm and Marvel. Because of that, it’s hard to imagine Disney going anywhere for a very, very long time.
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