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CASE 1 • WALT DISNEY COMPANY — 2009 11

television production, and syndication, Showtime, and CSTV Networks. In 2008, the
Television segment of CBS contributed 64 percent of company’s total revenue (approximately
$8.99 billion). The Radio segment derives revenue primarily from advertising sales. In 2008,
the Radio segment generated 11 percent of CBS’s total revenue (approximately $1.5 billion).
News Corp., with $33 billion in revenue, operates in eight industry segments: Filmed
Entertainment, Television, Cable Network Programming, Direct Broadcast Satellite
Television, Magazines and Inserts, Newspapers, Book Publishing, and Other. For the fiscal
year 2008, the Filmed Entertainment, Television, Cable Network Programming, and Direct
Broadcast Satellite Television contributed approximately 65 percent or $21.2 billion to the
company’s total revenue. The company has been moving aggressively toward digital
technologies such as broadband, mobility, storage, and wireless. News Corp. owns
MySpace.com, one of the Internet’s most popular social networking site, and IGN.com (a
gaming and entertainment site). Fox TV, owned by News Corp., ranks as one of the most
popular networks on television with an average audience of 7.6 million every night, fol-
lowed by CBS with 6.7 million viewers during each prime time, Walt Disney Company’s
ABC with 5.4 million viewers per night, and finally NBC (owned by General Electric
Company) with 4.8 million viewers during each prime-time period. News Corp. recently
acquired Dow Jones & Company and Liberty Media Corporation, which included approxi-
mately 41 percent interest in the DIRECTV Group, Inc.
Time Warner’s media and entertainment segments include AOL, Cable, Filmed
Entertainment, Networks, and Publishing. The Cable segment services primarily analog
and digital video services, and advanced services such as VOD and HDTV with set-top
boxed equipped with digital video recorders. The Filmed Entertainment segment produces
and distributes theatrical motion pictures and television shows. The Network segment con-
sists of HBO and Cinemax pay television programming services. The Publishing segment
publishes magazines and Web sites in a variety of areas and has a strategic alliance with
Google, Inc. Exhibit 13 demonstrates Time Warner’s revenue by segment.

Competition: Parks and Resorts
Disney’s theme parks and resorts compete with all other forms of entertainment, lodging,
tourism, and recreational activities. Many uncontrollable factors may influence the prof-
itability of the leisure-time industry such as economic conditions, including business cycle
and exchange rate fluctuations; travel industry trends; amount of available leisure time; oil
and transportation prices; and weather patterns. Seasonality is another concern for this seg-
ment because all of the theme parks and the associated resort facilities are operated year-
round. Peak attendance and resort occupancy generally occur during the summer months
when school vacations take place and during early winter and spring holiday periods.
According to a survey conducted by the International Association of Amusement Parks
and Attractions (IAAPA), there are more than 400 amusement parks in the United States, gen-
erating approximately $11.5 billion in revenues. The Magic Kingdom at Walt Disney World in
Florida was the most visited amusement park in the world. The amusement parks in the
United States employ approximately 500,000 year-round and seasonal employees.

EXHIBIT 13 Time Warner, Inc., Revenue (in millions) by Segment (2007)

Percentage of Operating
Segment Revenue Total Sales Income
Cable $ 17,200 35.44 $ (11,782)
AOL 4,165 8.58 (1,147)
Filmed Entertainment 11,398 23.49 823
Networks 11,154 23.00 3,118
Publishing 4,608 9.49 (6,624)
Total 48,525

Source: Time Warner Inc., Form 10K (2008).