ESPN
Another great company brand and business, is ESPN, which continues to be the leading
sports brand across all media with four program services, a number one Web site, ESPN The
Magazine, ESPN Radio, and the ESPN Zone.
In 1999, ESPN -- which is available in 77 million homes -- delivered more men than any other ad-supported cable network. In addition, ESPN and ESPN2 enjoyed the highest combined viewership in the networks' history, with growth in primetime fueling the increase. ESPN had eight of the top ten cable telecasts for 1999.
In addition to ESPN, the remaining cable assets in our portfolio continue to grow. The Disney Channel is now seen in 60 million homes, and Toon Disney is in 15 million. Lifetime, A&E, the History Channel, and E! Entertainment are all growing nicely, as well.
SoapNet
SoapNet is the newest of our program services, which launched on-air and on-line on
January 24, with an attention grabbing campaign.
It is the only 24-hour, all-soap cable network featuring same-day telecasts of ABC's "General Hospital," "All My Children," "One Life to Live" and "Port Charles." The program service also offers some of television's most popular serial dramas such as "Falcon Crest" and "Knot's Landing" as well as an original program that is similar in format to Sportscenter on ESPN called Soapcenter.
Agreements are in place to expand SoapNet to over 11 million subscribers over the next 36 months, and we believe this service will be the fastest-growing new channel in cable and satellite television.
More International
As I mentioned earlier, one year ago, I was appointed to lead The Walt Disney Company
internationally and given the mandate to focus on the enormous potential of our brand in
markets outside the United States. Our principal goal is to grow revenue, where the upside
is enormous.
To give you some idea of the significant bottom line potential of our international efforts ... if we can simply increase the per capita spending levels in just five countries -- England, Italy, Germany, France and Japan -- from the current 50 percent of U.S. levels to 80 percent, then we will generate an additional $2 billion in annual revenue.
Another potential catalyst for international growth is represented by Hong Kong Disneyland. Consider the fact that, from two years before the opening of Disneyland in 1955 until five years after, Disney merchandise sales in the U.S. more than doubled. Similarly, in 1983 Tokyo Disneyland opened and, by the end of 1988, Disney Consumer Products revenues had more than tripled in Japan compared to 1981. As for Disneyland Paris, from two years before the launch of the park until five years after, our consumer products business in Europe went up by ten times.
Of course, there were many reasons why our businesses went up so much after these parks opened. But the power of a Disney theme park is enormous and the fact is Hong Kong Disneyland could have tremendous implications for our company with 1.2 billion people in China alone and a huge population base in Asia Pacific.
At Walt Disney International, we also are focused on reducing expenses, where we have an equally significant opportunity. In order to accomplish these goals, we plan to act as one company in every market, as we do in the United States, with an integrated view of our brand, all our businesses, and our consumers.
The four key initiatives we are focused on are:
- Consolidation, rationalization, and economies of scale: simply put, operating more efficiently!
- Consistent brand management across all lines of business within each territory, with a strong focus on local consumers.
- Creating leverage with all our trade and partner relationships, particularly at retail.
- And acting locally, and identifying local growth opportunities for global exploitation.
After fast-paced growth across many regions, in which we captured first mover advantages in many businesses, we must now identify numerous opportunities to operate more efficiently as a whole, while also maintaining and respecting the expertise of our global lines of business.
We expect to deliver cost savings through a consolidation of real estate, finance and accounting, human resources, legal entities, strategic sourcing, and information technologies.
We are not only making traditional businesses more efficient, we also are building new ones.
I'm very excited about my new role during this extremely dynamic time ... and nothing is more exciting than taking Disney to the Internet domestically and around the world.
I have great confidence in the brands of The Walt Disney Company ... brands that will thrive and grow in this vast new medium.