M&A

Not such a magic kingdom?

Wanda boss picks a fight with newcomer Disney

People visit Disney Town of Shanghai Disney Resort in Shanghai

When you diss upon a star

Judging from its frequent mentions in the press and social media, the term ‘super IP’ might become China’s buzzword of the year. It refers to money-spinning intellectual property rights that can be cross-sold across different consumer categories, with a long lifespan. For example, The Three-Body Problem, a science fiction novel by Liu Cixin, is being adapted into a movie trilogy, and merchandised into a range of video games and toys. If successful, it could deliver ‘super IP’ profits.

Xinhua has identified another potential case – Dalian Wanda’s boss Wang Jianlin. Often ranked as China’s richest man, Wang turns out to be a very good singer as well. A video of one of his performances has been viewed 2.5 billion times since January, according to calculations by Tsinghua University. (About the same as all the views of K-Pop artist Psy’s Gangnam Style on YouTube since 2012). Wang’s book, The Wanda Way, has also sold 750,000 copies over the past 15 months.

“In Wang Jianlin, a new super IP is born,” Xinhua proclaims. Wang himself seems more concerned with taking on the mother lode of super IPs: Walt Disney. The billionaire appeared on an hour-long talkshow on state television last week to talk about Wanda’s global ambitions – and he took every opportunity to bash his American rival.

“Disney is the number one brand in the entertainment industry,” he acknowledged. “The best business is one that you don’t need to do anything. Disney certainly belongs to this category. It goes everywhere in the world empty-handed, sells its brands and takes the money.”

In January Wanda paid $3.5 billion for the film studio Legendary Entertainment. The acquisition is yet to produce super IPs akin to Disney’s Captain America (see WiC325). But Wang thinks that Wanda’s tourism business could outdo Disney’s latest theme park, which will open later this month in Shanghai.

“Disney shouldn’t have entered China,” Wang warned. “In an internal meeting I’ve said we have to make Shanghai Disneyland unprofitable in 10 to 20 years time.”

Wanda is squaring up to Disney with at least a dozen Wanda Cities, which it describes as “cultural-tourism property projects”. These include studio-theme park complexes like the Oriental Movie Metropolis, in which Wanda is committed to invest Rmb230 billion , or around $35 billion (a slew of Hollywood A-listers walked the red carpet for its inauguration ceremony in Qingdao, see WiC211).

Wang believes that the range of Wanda attractions will overwhelm his American rival, likening Disney to “one tiger” set to be ravaged by Wanda’s “pack of wolves”.

He also let it be known that he thinks the investment in Shanghai Disneyland was too high and that the entrance fees will deter visitors. “With the scale similar to our Nanchang complex, their Shanghai park costs $5.5 billion. I have no way to even comprehend this. We analysed why they spent so much money on it and we can’t explain it in a sentence or two,” he said.

Wang also played the national card, with a warning that Shanghai Disneyland glorifies American culture, which he deems outdated. “The frenzy of Mickey Mouse and Donald Duck and the era of blindly following them have passed. [They are] entirely cloning previous IP, cloning previous products, with no more innovation.”

Better a more culturally-attuned offering, Wang insisted: “Chinese culture led the world for 2,000 years… we want a global brand for Chinese firms.” That made it more of a surprise when visitors reported that some of the staff at Wanda’s new Nanchang park were dressed as Disney characters, including Captain America, Snow White and as Star Wars stormtroopers. Disney – which says that it was “perplexed” by Wang’s public attack – went on the offensive, insisting that it would “vigorously protect” its intellectual property.

Wanda fired back that the Disney characters seen by visitors were employed for promotional purposes by independent retailers, with the use properly licenced from Disney.


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