Eco 212 Week 3 Team Paper

The Walt Disney Company's objective is to be one of the world's leading producers and providers of entertainment and information, using its portfolio of brands to differentiate its content, services and consumer products. The company's primary financial goals are to maximize earnings and cash flow, and to allocate capital toward growth initiatives that will drive long-term shareholder value (Disney, 2012). The Walt Disney Company is an organization which provides product and service in five segments of the entertainment industry; these segments are media networks, parks and resorts, studio entertainment, interactive media, and consumer products (Datamonitor, 2012).

Disney as an Oligopoly

Oligopoly describes a small group of companies, two or more, that control the market for a select product or service. These organizations rely on how they interact with its competitors for profitability (Hubbard & O’Brien, 2010). Additionally, the barriers of entry in an oligopoly market structure are difficult and expensive (Hubbard & O’Brien, 2010).

Walt Disney Company shares oligopoly status with Universal Studios and on a lesser degree, with Warner Brothers Studios; other diversified entertainment companies, such as Paramount Studies, and MGM/Sony have been unsuccessful in comparable ventures due to a significant lack of revenue (Pepitone,(2010).

Effectiveness as an Oligopoly

Disney’s success can be attributed to its product and service portfolio of well-known brands, strong cable television presence, and a durable brand uniformity enjoyed by parks and resorts operations (Datamonitor, 2012) Disney has a long-term contract to distribute DreamWorks Studios (Shrek franchise, including Puss-n-Boots) film and DVD releases, owns Marvel Comics (X-Men franchise, Iron Man franchise, and 5,000 other characters), and recently acquired the rights to James Cameron’s 2009 film ‘Avatar’ to develop an Avatar attraction at all theme parks and resorts by 2013(Disney, 2011). Disney parks...