Universal vs. Disney: The Battle for Orlando | An IP for an IP | 3

David Brown

Audible subscribers can listen to all episodes of Business wars ad free right now. Join Audible today by downloading the Audible app. June 18, 2010 the sun hasn't risen yet, but thousands of Harry Potter fans are already gathered outside the gates of Islands of Adventure, one of the two theme parks that together are known as Universal Orlando Resort, Florida in June is humid and heavy even before the day has properly begun. It's a long way from the cool stone corridors of Hogwarts Castle or the snow capped roofs of Hogsmeade, but nobody here seems to care. They've come for the grand opening of a theme park that promises to transport them from the Muggle world into the wizarding world. Many are dressed for the occasion, too, wearing Hogwarts robes, round glasses, striped scarves and house ties. Some have drawn lightning bolt scars on their foreheads, others grip wands. Teenagers who grew up with the book stand beside younger children who know Harry Potter primarily from the films. They haven't come here just to ride a roller coaster. They've come to experience the wizarding world of Harry Potter. When the gates open, the crowd surges forward. Thousands hurry across Islands of Adventure, passing through Seuss Landing and the Lost Continent, past the bright colors and cartoon curves of Universal's earlier attempts to reach Disney's family audience. Now all of that is a sideshow to something more powerful. Soon it's a six hour wait just to get inside the new attraction. Those who make it discover that Hogsmeade, the Wizarding Village, is narrow and compact, forcing visitors to slow down and take it all in. Crooked shop fronts lean inward. Fake sculpted snow sits on rooftops. Owls perch overhead. Shop windows glitter as quills write by themselves, portraits move and magical objects stir behind glass. The Hogwarts Express train breathes steam. Nearby, the Weasley's flying car lies crashed into a tree wand boxes stack from Florida rafters inside Ollivander's shop, the Three Broomsticks, is dark and tall like the tavern from the films. The concessions sell pumpkin juice in pumpkin shaped bottles and butter beer that tastes like cream soda beneath a thick butterscotch foam, the result of weeks of recipe testing and a tasting session in Scotland with J.K. rowling herself. That level of scrutiny has been applied across the entire world, from the look of Hogwarts Castle to the font on restaurant menus. At the opening ceremony, the film's stars arrive like visiting royalty. Daniel Radcliffe, the actor who plays Potter himself, praises Universal for carrying the book's legacy forward. For the fans, it's confirmation that this place doesn't just honor the story, it belongs to it. But for Universal, this morning is about more than magic, it's about survival. The company bet more than 250 million doll on the Wizarding World, and that's layered on top of years of debt and corporate doubt. When GE took control of Universal six years earlier, its theme parks were in trouble. The Orlando resort had just lost more than $50 million in a single year and was carrying more than a billion dollars in debt. Cuts followed. Universal Creative, the company's equivalent of Disney's imagineering, was gutted and many new attractions were put on hold. Universal hopes Harry Potter can do what Jaws, Back to the Future, Jurassic park and Dr. Seuss couldn't manage on their own. Make Universal Orlando more than just a day trip for visitors already going to Disney World. Potter needs to lift attendance, revive food and merchandise sales, and create the kind of must buy souvenirs Disney specializes in, while proving to GE that theme parks don't have to be expensive, low margin businesses. Disney is still 10 miles down the road with four parks, decades of family loyalty, and an entire vacation machine built to keep guests inside its gates. But as the queues trail for hours back from Hogsmeade, Universal sees the possibility that it's been chasing for 20 years a world that people will choose to enter instead of Disney World.

Dan Taburski

Does it bother you that the world is on fire? Do you also often find yourself choking on your own rage? Maybe you too perpetually feel like screaming bloody freaking murder into your own pillow? Well, hop in, rabble rouser. We're going hunting for a manifesto. Listen to Dan Taburski's manifesto wherever you get your podcasts.

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David Brown

from Audible Originals, I'm David Brown and this is Business Wars. On the last episode, Universal stepped up its ambition by opening Islands of Adventure, a second Orlando theme park for filled with comic book heroes, dinosaurs, cartoons, fantasy and children's literature. But it still couldn't match Disney World's appeal as a vacation destination. So it went after the one property powerful enough to change that Harry Potter. Company executives flew to Edinburgh, sat across from J.K. rowling and promised her something Disney wouldn't total creative control. Now the Wizarding World of Harry Potter is finally open, attendance is surging and for the first time, there's a real chance families might make Universal the center of their Orlando vacations. This is episode three, an IP for an iPad. In 2010, the year that the Wizarding World of Harry Potter opened, Islands of adventure draws almost 6 million visitors. One year later, attendance jumps to nearly 8 million, a 36% increase. Harry Potter drives roughly half of all new theme park visitors in North America that year. Universal's new success arrives at an awkward moment for Disney. The 2008 financial crisis forced Disney to subsidize hotel rooms and food to keep families coming to Orlando. The strategy protected attendance, but hammered profits. In the 12 months leading up to October 2009, operating income at Disney's resorts unit fell 25% to $1.4 billion. Now Disney's trying to restore its profits by pulling back those discounts just as Universal launches the biggest new draw in Central Florida. Mickey and Minnie aren't running scared yet. Disney World still dominates the region. Plus, Universal's blockbuster promotional campaign for the Wizarding World, which includes a Super bowl commercial, might even help Disney by attracting more tourists to Orlando overall. But to others, that sounds like wishful thinking around Orlando. It's rumored that Harry Potter is pulling guests away from Disney World. And shortly after Potter opens, Disney abruptly stops disclosing attendance for its individual parks, a move some analysts see as a way to avoid awkward head to head comparisons. Disney insists the change has nothing to do with Universal, claiming it's merely part of company wide changes on how it reports performance.

Bob Iger

Performance.

David Brown

Publicly, Disney's executives stay serene. Disney World president Meg Crofton even sends a congratulatory note to her counterpart at Universal. But beneath this graciousness, the message is clear. Universal has finally found a story powerful enough to pull families away from Disney's property. Harry Potter changes the fortunes of Universal's theme parks. Food and merchandise sales rise. Wands become Universal's answer to mouse ears, a souvenir that feels necessary because it belongs to the story. But Universal's parent company, ge, isn't sticking around to enjoy the upside. The industrial giant has been looking to get out of the media business for years. In 2011, GE sells a majority stake in NBC Universal to cable TV giant Comcast for more than $13 billion. For Comcast, the chance to control NBCUniversal and its movie, television, cable and theme park interests is too tempting to pass up. And Universal's theme parks, freshly supercharged by Harry Potter, are an important part of the appeal. Cable television is getting disrupted, but no one can stream the physical experience offered by theme parks. Soon after striking its deal with ge, Comcast spends another billion dollars buying out investment firm Blackstone's stake in Universal Orlando. With Comcast now fully in charge, a new day dawns. Universal no longer needs to plead for capital for its theme parks. Comcast is ready to invest. It knows that if the parks keep giving families new reasons to visit, those trips could become one of the company's most reliable revenue generators. Universal's parks now have real momentum, investment and the hottest property in books and film on their side. Inside Disney, the threat is getting harder to dismiss. So the company fortifies. In 2011, Disney announces a long term deal to bring Avatar to Animal Kingdom. Disney doesn't own the Avatar franchise yet. That won't happen until its Fox acquisition closes in 2019. But Avatar is the biggest film of all time, a global 3D spectacle with an entire alien planet fans might want to enter. The expansion is expected to cost roughly $500 million. The arms race is growing increasingly urgent for both Disney and Comcast. Theme parks now look unusually valuable because so much of the entertainment industry is becoming unstable. DVD sales are falling. Blu Ray is not enough to make up the difference. And streaming platforms are beginning to pull audiences away from discs altogether. Movie studios can live or die by the next flop. Each film is a costly wager, but parks still produce reliable cash. People can pirate a film, they can't pirate a visit to Hogwarts Castle. Disney used to be the only Hollywood player with this rare advantage. But now, armed with a Harry Potter license and Comcast's heft, Universal is no longer the underdog trying to survive on clown cleverness and nerve. It's a challenger with a proven model and real capital behind it. It's May 2011, and in Orlando, Disney CEO Bob Iger is standing beside George Lucas, the creator of Star wars, holding a toy lightsaber around them. Disney's Hollywood studios is in celebration mode. Cameras are raised. Fans are cheering. The revamped Star Tours ride is about to reopen. It's the same Star wars galaxy, but now with new planets to visit and the added immersion of 3D. This is the early 2010s, and 3D is being sold as the future of movies. Studios are scrambling to boost the wow factor of their blockbusters with the help of 3D glasses. And Disney is giving Star Tours the same treatment. Lucas looks relaxed and slightly amused. Iger looks like the polished Disney chief executive. He is calm, diplomatic, always thinking three moves ahead. But right now, Iger has a problem. He's not entirely sure how to wield a lightsaber. Lucas glances over. Bob, why are you holding it like a golf club? Iger looks down at the toy in his hands and tries to laugh it off. I was hoping no one would notice. Lucas adjusts his own grip, demonstrating not too tight. It's not a sword, it's a lightsaber. Iger copies him, raising the blade for the photographers. The crowd cheers. Cameras flash on the surface. It's a theme park photo op. Two executives, two toys, one beloved franchise already living inside a Disney attraction. For Iger, though, this moment crystallizes a problem. Disney has Star wars in its parks, but only on borrowed terms. It can operate Star Tours, but the mythology belongs to Lucas. Iger knows Lucas is thinking of retiring to focus on smaller films, and that could create an opportunity to bring Star wars under Disney's wing. Iger smiles for the camera's lightsaber raised and feels the force of the myth in his grasp. In October 2012, Disney seizes the opportunity and acquires Lucasfilm for $4 billion. The deal gives Disney control over Star wars, one of the most valuable intellectual properties in the world, and it wants to use it to strengthen its parks. The deal gives Disney Star Wars, Indiana Jones, and an entire universe of characters and planets. Lucas will stay on as a creative consultant. Disney's plan is immediate and aggressive. A new Star wars film in 2015, then another film every two or three years. For Iger, this follows the same playbook that brought Pixar and Marvel into the company. Disney is no longer waiting for beloved worlds to emerge from inside its own studio. It's buying them, then feeding them along the Disney conveyor belt, from movies to television, from toys to theme parks. There are already Star wars and Indiana Jones attractions at Disney's parks in California, Orlando, Paris, and Tokyo. But now that Disney owns the source material, Star wars becomes a weapon it can build, extend, and control at will. In the post Potter world, this distinction is crucial. Universal has proved that fans don't just want to ride through a story, they want to inhabit it and feel that fiction has become physically real. Disney has watched Potter succeed, so it bought the only pop culture universe big enough to counter it. Universal may have Hogwarts, but Disney has the Death Star. Here's the crucial difference. Disney owns Star wars outright, while Universal is licensing Harry Potter from Warner Brothers and J.K. rowling. That means Universal faces endless royalties, layers of approval, and the long term risk that comes with building an entire resort strategy around someone else's creation. For now, Universal has no choice. Potter has worked too well to abandon. And there's simply no other franchise of that magnitude available to buy outright. So Universal does the only thing it can. It doubles down on a world it doesn't own. And with the announcement that Disney now owns Star Wars, Universal needs to scale up quickly. In July 2014, Universal expands the wizarding world. And it does something clever. It reconfigures Universal Orlando's physical layout to become part of the experience. Instead of placing Diagon Alley beside Hogsmeade in Islands of Adventure, Universal builds it across the resort inside the original Universal Studios Florida park. And this decision changes the business model. To experience the full Potter world of Hogsmeade, Diagon Alley and the train between them, guests now need a park to park ticket, a meaningful upgrade in price. To make way for Diagon Alley, Universal shuts down Jaws. The symbolism is hard to miss. Jaws is the ride most associated with the park's disastrous 1990 opening. The attraction that once stranded a top company executive in the lagoon until he could be rescued by Rowboat. Now Universal is demolishing an attraction tainted by its most embarrassing failure to to make room for the franchise that has finally given the company Disney level drawing power. The plan is ingenious. Diagon Alley at Universal Studios Florida connects to Hogsmeade at Islands of Adventure via the Hogwarts Express. In this way, park hopping becomes its own piece of theater. For Universal creative executive Tiri Koop, the challenge is fidelity. Diagon Alley must feel denser and more urban than Hogsmeade London facades. King's Cross Railway station, platform 9¾. Hidden wizarding streets and layers of detail that make the guests feel like they've crossed from the Muggle world into Rowlings. Guests board the train at King's Cross station, pass through the illusion of Platform 9 and 3/4, and ride a train whose windows and corridor doors show a different magical journey in each direction. Potter is now a resort wide system. Universal has proven that a story world can become an entire geography of shops, transports, souvenirs and rituals. Disney still draws more visitors worldwide, but Universal's parks are growing faster. And with Universal on the rise, Disney must ready its empire to strike back.

Dan Taburski

Hey, Dan Tabursky here. I'm a podcast host, a journalist, and now with my newest project, the author of my own manifesto. Well, it's a manifesto about manifestos. My search for inspiration in a world that feels more infuriating, more out of its freaking mind with each passing hour. Manifestos are a call to action, an artful scream. They capture our anger and they try to do something with it. This is my attempt to take the Manifesto back from mass shooters and nihilists and return it to its rightful place with the warriors, the visionaries, the regular folks with just the right amount of crazy. I compare notes with radicals, secessionists, Internet trolls out for a laugh, and punk singers screaming their guts out, all trying to turn their anger into the world they want to see. Listen to Manifesto wherever you get your podcasts. Audible subscribers can binge all episodes of Manifesto early and ad free right now, join Audible in the Audible app or by subscribing on Apple Podcasts.

Alice Levine

I'm Alice Levine.

Matt Ford

And I'm Matt Ford and we're the hosts of British Scandal.

Alice Levine

Yes indeed. In this series, a Derbyshire couple are bored of their curtain tw lawn mowing suburban life.

Matt Ford

So they sell their house, build a yacht and sail off around the world.

Alice Levine

Which sort of sounds idyllic until a sperm whale sinks their boat and they begin to starve.

Matt Ford

Oh yes, and they didn't bring a radio because real sailors don't use radios, right? This is the story of Marilyn and

Alice Levine

Maurice bailey and the 117 days they spent lost at sea.

Matt Ford

Follow British Scandal wherever you get your podcasts, or listen early and ad free on Audible.

David Brown

It's 2014 and Disney has a new high tech trick for keeping families cocooned within its Orlando ecosystem. A family arrives at Walt Disney World, but rather than pull out a ticket at the gates, the first thing they do is lift their wrists. At the hotel room door, a child presses a rubber bracelet against the lock and the light turns green. Inside the Magic Kingdom, that same band gets them through the gate. At lunch, the girl's dad takes taps the band against a reader and pays for food without opening his wallet. Later, the family walks past a long standby line and into a shorter fastpass plus lane because they booked their ride window weeks earlier at home. And when they show up for dinner at the Be Our Guest restaurant, their reservation is already in Disney's system. While Universal is turning Harry Potter into a two park ticketing machine, Disney is pouring money into something less eye catching, but just as strategic control. The company's new system is called MyMagic Plus. Its most visible piece is the MagicBand, an RFID enabled wristband that lets guests unlock hotel rooms, buy food, make reservations, and book ride times. It raises an obvious question. Why not just build a phone app? But a phone has to be charged and carried, while a wristband turns the guest into the interface. The promise for consumers is convenience. No tickets to lose, no Room keys to carry. Less fumbling and less waiting. For Disney, the prize is data and commitment. Disney can now track every step visitors make, alert staff to guests, birthdays, and even manage crowdflow in real time, throwing spontaneous parades and other diversions to funnel people away from overcrowded areas. The earlier a family books its meals and ride windows, the more their vacation locks into Disney property. And the more completely Disney manages the the day, the harder it becomes for Universal to steal one of those days. For Harry Potter, this is something that's often missed. Convenience is actually a product. We tend to think of businesses as selling a ride, a meal, or a hotel room. But sometimes the thing people value most is removing little annoyances and shrinking the space between I want it and I got it. Remember the first time you placed an order online and saw that buy now button? Yeah. That's the ticket, all right. Companies that quietly remove friction often win before customers and competitors even realize what's happening. If guests at Disney World spend less time standing in line searching their handbag for tickets or deciding what to do next, well, they spend more time buying drinks, mouse ears, princess dresses, and churros. But the cost of Disney's new system is staggering. Between 1 and $1.5 billion. That's more than many theme park projects cost to build, and around six times more than Universal spent bringing the Wizarding World of Harry Potter to Orlando. Critics wonder whether Disney would have been better off just building new rides. Because while Disney now has a way to lock families from further into its Florida ecosystem, it's still missing a true answer to Potter. A world powerful enough to make fans plan an entire trip around it. For that, Disney needs a new mythology of its own. It's 2015, five years since Universal's Wizarding world set a new standard for immersive lands. Now Disney is finally ready to strike back. And at the D23 Expo at the Anaheim Convention center, it's about to unveil its answer in front of its own faithful. Thousands of Disney fans are packed into the hall. There are annual passholders, collectors, families, cosplayers, and adults who've built whole parts of their lives around Disney's openings, anniversaries, parades, and merchandise drops. These super fans are the advance guard in the theme park wars. Customers who buy early, post first, debate every detail online and come back time after time to see what's changed. And today, Disney boss Bob Iger has something big in his store for them.

Bob Iger

Well, we're bringing Star wars to life in a big way, and I mean really big. We're creating a jaw dropping new world that represents our largest single themed land expansion ever.

David Brown

Star wars is coming to the parks on a massive scale. With two 14 acre lands. One at Disneyland in California and one at Disney's Hollywood Studios in Florida. The super fans erupt into applause. Analysts estimate the bicoastal expansion, including park and infrastructure, will cost more than $2 billion. But as Universal's Wizarding world showed, scale alone isn't enough. The land has to feel inhabitable and stay true to the world it's based on.

Bob Iger

Every store and restaurant will be operated by local inhabitants, making each experience deeply immersive. Nothing in the land, nothing will be out of character or stray from mythology.

David Brown

The new Star wars edition at Disney's Hollywood Studios carries special symbolism. This is the part former CEO Michael Eisner rushed into existence to beat universal back in 1989. By 2015, much of its original movie studio tour identity has been dismantled. The backlot tour is gone. The animation pavilion is closing. The park that once tried to show guests how movies are made is being rebuilt to deliver what modern theme park guests actually want. Not a glimpse behind the curtain, but a chance to step inside the story worlds they love. Today, many customers care less about what's behind the scenes and more about the feeling, the emotion. Ever wonder why people love going to the Apple stores? They're designed to make you imagine owning the device. They even pump in the smell. The smell of a new gizmo just being opened. Maybe the lesson here is that customers usually buy the end experience, not the process that produced it. In 2018, Universal's Islands of Adventure attracts almost 10 million visitors, up more than 60% since it added Harry Potter. Potter is also lifting up Universal Studios Florida. After Diagon Alley opened in July 2014, attendance rose nearly 30% to 10.7 million visitors in 2018. The Two Park Potter strategy is working. Guests are buying multi park tickets, riding the Hogwarts Express between lands, drinking butterbeer, buying wands, and spending more of their vacation inside Universal's resort. The spell extends beyond Florida too. Thanks to Potter, Universal Studios Japan adds more than 6 million annual visitors over the decade. Universal is now the fastest growing major theme park operator in the world.

Dan Taburski

Wow.

David Brown

It's remarkable how the right IP can transform fortunes. This reminds me a little of what happened in our series on Lego. You know, for decades Lego seemed trapped in a niche. Then it allied with Star wars and reignited interest in the brand. Sometimes you don't need a hundred beloved characters. You just need a few. A few that People can't stop talking about. Disney is still the giant. Its parks empire stretches across Florida, California, Paris, Tokyo, Hong Kong and Shanghai. Its castle parks remain among the most visited attractions on Earth. And the revenue gap isn't enormous. In 2018, Disney's Parks and Resorts division brings in more than $20 billion. The following year, Comcast's theme park business is still making less than $6 billion. Universal isn't overtaking Disney in absolute size, but it is growing faster from a smaller base. And it has partially solved another of its old weaknesses. Family friendly characters. For years, Disney had a stronger, more colorful cast of characters and kingdoms. Mickey, Minnie, princesses, Pixar and Star Wars. Universal had thrills. Monsters, Steven Spielberg and licensed worlds. Then its animation division, Illumination changed the whole equation. Its breakout blockbuster, Despicable Me gave Universal the minions tic tac shaped child friendly characters that can anchor rides, sell toys, appear in parades and make Universal feel more like a resort for the whole family. Universal is now the fastest growing major theme park operator in the world. And it did it with a wizard it doesn't even own. Disney owns a whole galaxy. And now it has to prove it can match Universal. It's Aug. 29, 2019, in Orlando before dawn. A line is already forming outside Disney's Hollywood studios. They're here for the opening of Star Galaxy's Edge. Disney has spent years building towards this moment. This 14 acre attraction promises to transport guests into the world of Star Wars. A near identical version is already opened at Disneyland in California. Now it's Orlando's turn. The park opens early. Fans stream through the gates dressed in Jedi robes, resistance jackets and Princess Leia buns. Children carry plastic lightsabers. Grown ups who first saw Star wars back in 77 walk beside teenagers raised on Kylo Ren and BB8. Inside the backlot fantasy of Michael Eisner's Disney MGM Studios has given way to Black Spire Outpost, a settlement on the remote planet of Batuu. There are weathered stone towers, droid tracks in the ground, alien market stalls, blue and green milk, Oga's Cantina. And at the center of it all, a full scale Millennium Falcon. For decades, fans have watched the ship leap into hyperspace. Now they can stand beneath it. The reaction is intense. Thousands pour into the land. The wait for the Millennium Falcon Smuggler's Run ride stretches for hours. One couple gets engaged in front of it. Disney has delivered on its promise. This isn't a ride about Star Wars. It's a place that looks and feels as if Star wars has become real, but almost Immediately, the story becomes more complicated. In California, Galaxy's Edge doesn't produce the stampede many had expected. Disney warned guests about enormous crowds, blocked out some annual passholders, raised prices, even required reservations during the first weeks. It seems to have worked too well. Some fans simply stayed away. Disneyland's attendance for 2019 flatlines. Florida looks better. Disney's Hollywood Studios gets a lift from Galaxy's Edge and the previous year's Toy Story Land. Attendance at the park rises to roughly 11.5 million in 2019. But that's only 600,000 more visitors than Universal Studios Florida. Disney remains larger, but Universal is catching up. Part of the problem is timing. Galaxy's Edge opens in phases. On opening day in Florida, the land's most ambitious attraction, Rise of the Resistance, isn't ready. It finally opens in Orlando in December 2019, giving visitors the completed Star wars experience they were promised. Disney prepares to reap the benefits. Then, weeks later, the whole world shuts down. In March 2020, the COVID pandemic closes both Disney and Universal's parks Just months after Rise of the Resistance opens. Whatever long tail momentum Disney expected from the completed Galaxy's Edge is interrupted almost immediately. Covid adds another uncomfortable lesson. For years, Disney's parks have seemed like the company's most bankable part of the business. But even the parks are vulnerable to forces no executive can predict. And when the world opens up for business again, Universal is already preparing its next move. A whole new park.

Moderator/Investor

Foreign.

David Brown

It's April 2024. Universal is making its biggest bet in a generation. Epic Universe. This will be Universal Orlando's first major new theme park since Islands of Adventure opened 25 years earlier and Universal's third gate. This isn't another land folded into an existing park. Epic Universe is designed to turn Universal's Orlando resorts into a true multi day destination. Epic Universe will offer whole worlds built around Harry Potter, Nintendo characters, How to Train youn Dragon and Universal's classic movie monsters, including Dracula, the Mummy and the Creature from the Black Lagoon. For Universal's parent company, Comcast, the business logic is compelling. A typical Orlando vacationer might spend three or four days at Disney and one or two at Universal. If Epic Universe can persuade families to move just one of those Disney days to Universal, hundreds of millions of dollars will move with them. Comcast calls this a foot on the gas. Keep investing through post pandemic uncertainty so that when demand returns, Universal has something fresh to entice customers. The pandemic exposed how fragile the theme park business can be. Comcast's answer is to build bigger anyway. But while Comcast is pushing forward, Disney is firefighting its juggling streaming losses, the waning appeal of its Marvel movies succession questions and the aftershocks of its political fight with Florida Governor Ron DeSantis after Disney criticized a law limiting classroom discussion of sexuality in the state. With all of that weighing on it, Disney is looking to its parks division to be a reliable profit engine, not a further drain on Resources. In 2023, Disney's Parks and Experiences business became the company's financial anchor. The division brings in a record $32.5 billion in revenue and nearly $9 billion in operating income, more than six times the operating income of Disney's entertainment vision, the part of the company that makes and distributes its films and television shows. But much of that growth has come from squeezing more dollars out of existing guests, not building new reasons for them to show up pricing tiers, reservation systems, paid line skipping, that sort of thing. But analysts fear there's a limit to how much can be gained from these kinds of incremental improvements. In fact, let me take this a step further. An argument could also be made that customers have just had enough of the complexity. Think about airline loyalty programs. At first, they felt like a bonus. Right now, you need a spreadsheet to figure out how to use those miles. When people start feeling like they need homework before they can enjoy your product, well, that should be a warning sign. To defend its majority share of the state Central Florida market, Disney needs new capacity, major lands, new rides and more reasons for families to spend another day inside Disney's ecosystem. But many of Disney's biggest answers are still years away. Universal's answer is already rising out of the ground. It's April 2024, and the Walt Disney Company is holding its annual shareholder meeting. These events used to fill stadiums. These days they're all virtual. Immaculate smoothness is the order of the day. Executives come with prepared remarks, polished graphics and pre screened questions. Even so, a meticulously managed meeting cannot completely manage the mood. The moderator moves to the next question.

Moderator/Investor

Our next question concerns Walt Disney World and competition in central Florida.

David Brown

The moderator reads a pre screened question from an investor anxious about the threat Disney World faces from Universal's new epic universe.

Moderator/Investor

Why hasn't Disney prepared anything or placed more than just a handful of attractions to be ready for this in 2025?

David Brown

Walt Disney World, the unusually blunt question hangs there. But it voices what many Disney fans, analysts, stockholders and travel agents have been thinking for months. Disney CEO Bob Iger answers that just

Moderator/Investor

couldn't be further from the truth. We've known about Universal's plans for more than a decade. We have a sophisticated way of assessing where capital should go, what capacity is needed, and when new projects should open. We don't simply react we look across the entire business and deploy capital strategically.

David Brown

Iger's line is clear. Disney's not asleep, but it's not panicking either. Iger points to the past decade of additions new lands, new rides, major refurbishments, investments spread across Walt Disney World rather than dropped all at once.

Moderator/Investor

By staggering these major launches, we're able to commercially and operationally optimize our new offerings over time.

David Brown

That's a CEO's answer, measured and defensible. But the stockholders question is a fair one, because Disney's own spending plan shows how seriously it takes the future of its parks. To reassure shareholders on the call, Iger promises a major investment $60 billion over 10 years in the company's parks, cruises and experiences. The majority of that money will go towards new attractions that expand the capacity of Disney's theme parks and cruise ships. The rest will be spent on the technology and maintenance needed to make that expansion possible. It's a vision of abundance, the biggest Magic Kingdom expansion in the park's history A tropical Americas landed in Animal Kingdom, avatar possibilities in California, advanced droids and new animatronics. But the timeline is measured in years, and the new threat from Universal is getting ready to open to the public. Eleven months later, in May 2025, 35 years after Universal's disastrous first Orlando open, the company opens Epic Universe. It cost a reported $7 billion to build, and it's the company's biggest expansion in Florida since the Wizarding World of Harry Potter. This isn't a new ride or another land tucked inside an existing park. It's a brand new park, roughly 110 acres of themed entertainment inside a much larger 750 acre development site with new hotels, roads, parking, backstage infrastructure and room for Universal to keep expanding. Guests enter through Celestial park, then pass through portals into four worlds, Super Nintendo World, how to Train youn Dragon, Isle of Birth, the Wizarding World of Harry Potter, Ministry of Magic and Dark Universe, Universal's gothic realm of classic monsters. The rides are technologically ambitious, the environments are dense and immersive. Early reviews are largely positive, with visitors praising the scale and detail of the park. It's the culmination of the strategy Universal's parks boss J. Stein imagined after the humiliation of opening day from 1990 a strategy built around giving vacationers more than just a side trip from Disney. And that more encompassing vision is evident in the ticket price. Initially, tickets to Epic Universe are only available as part of a multi day package granting one day of access to the new park and two days to the older parks. The cheapest ticket costs more than $350. The message is clear. Universal doesn't want Epic Universe to be sampled in isolation. It wants the new park to pull guests deeper into the whole resort. And that strategy may help explain why the opening does not produce wall to wall chaos across the entire park. On opening day, the new Harry Potter ride draws five hour waits, but other major attractions are far more manageable. Universal isn't operating Epic Universe at full capacity yet executives later say the park is still ramping up ride throughput and attendance. But commercially, the early signs are strong. Comcast reports that Epic Universe is already having a positive impact on Universal Orlando, and by the end of 2025, the park's business is hitting new financial highs. Publicly, Disney projects confidence, its hotel bookings are strong, it's investing billions in its parks, and its executives still insist that any tourist who comes to Orlando for Epic Universe will also visit the Magic Kingdom, just as they argued when the Wizarding World of Harry Potter first opened. But Disney's vacation machine is showing strain. Over the past few years, Disney has raised prices, introduced new forms of paid line skipping, changed reservation systems and asked guests to do more planning before they ever reach the gates. Its Lightning Lane line skipping service promises shorter waits but also adds cost and complexity, booking Windows, app refreshes, return return times and premium attractions that require a separate purchase. Disney isn't alone in charging for this kind of speed and convenience. Universal sells an Express Pass too. But Disney World has long sold itself as a definitive family vacation. For some families, that magic now comes with tedious homework, which makes Epic Universe all the more dangerous. It's not only a spectacular new park, it's an alternative. And it arrives at a moment when Disney is asking guests to spend more and navigate an increasingly complicated system. Universal isn't simply trying to beat Disney on rides. It's trying to make the whole Orlando equation feel different. After 35 years, Universal still has a become bigger than Disney. But it's no longer just a one company town in a place built on worlds of adventure, expanding into new realms of science fiction, fantasy and lovable characters. The question may be in the real world, is Orlando going to be big enough for the both of them?

Moderator/Investor

Foreign.

David Brown

Business wars on the Audible app or wherever you get your podcasts, you can listen to all episodes of Business wars ad free by joining Audible from Audible Originals this is Episode three of Universal versus Disney the Battle for Orlando for Business Wars. A quick note about the recreations you've been hearing. In most cases, we can't know exactly what was said. These scenes are dramatizations, but they're based on research. And if you want to know more about Disney's takeover of Lucasfilm, we recommend Ride of a Lifetime by Robert Iger. If you'd like to hear more about the theme park war, you can listen to the audiobook version of Universal vs Disney by Sam Greenway right now on Audible. And if you enjoyed this season, check out our earlier Series Disney Pixar vs DreamWorks, a deep dive into the 1990s and 2000s animation wars between Steve Jobs at Pixar and Jeffrey Katzenberg at DreamWorks. I'm your host David Brown. Simon Parkin of Yellowant wrote this story. Our senior producers are Jenny Bloom and Emily Frost. Our producer is Tristan Donovan of Yellowant. Karen Lowe is our producer Emeritus. Our managing producer is Desi Blalock. Research by Marina Watson Fact checking by Stephanie Power Sound design by Josh Morales Kyle Randall is our lead sound designer, Executive producer for Audible Jenny Lauer Beckman, Head of Creative Development at Audible Kate Navin, head of Audible Originals North America Marshall Louie, Chief Content Officer Rachel Giazza Copyright 2026 by Audible Originals, LLC Sound Recording Copyright 2026 by Audible Originates.