Comcast launches plans to develop theme parks
March 11, 2014, 12:09 am TWN
PHILADELPHIA--Comcast Corp. will invest hundreds of millions of dollars in California and Florida theme parks, stepping outside its core business of telecommunications in an effort to boost revenue and profits.
In a story published Sunday, The Philadelphia Inquirer said recent moves by the Philadelphia-based, cable-TV company represent a challenge to the Walt Disney Co.'s tourism business in Orlando.
Comcast took over Universal Orlando Resorts as part of its NBCUniversal acquisition in 2011. This summer, it plans a new Harry Potter ride at a second theme park that will share the same 750-acre (300-hectare) Universal complex.
Comcast is also financing construction of the 1,800-room Cabana Bay Beach Resort with 50-50 partner Loews Corp., allowing guests to eat, sleep and swim on the same Universal complex.
Once fully open later this year, Cabana Bay will boost Universal's hotel room count in Orlando by 75 percent, to 4,200 rooms. The first 600 are scheduled to open this month.
CEO Brian Roberts said Comcast is "doubling down on theme parks" because the investment will pay off for many years to come.
"We think there is a lot there in the theme park business for many years to come, and that we have the low market share and only one way to go," Roberts said at an investor conference in January.
In 2013, Comcast's theme parks and resorts unit, part of NBCUniversal, reported US$2.2 billion in revenue and US$1 billion in operating cash flow — a measure of the division's profitability.
Between the second Potter attraction and Cabana Bay, the Universal theme park complex is expected to add 3,500 jobs this year, bringing its Orlando-area employment to about 17,000.
Universal executives in Orlando do not say they are targeting Disney, the tourism giant with more than 20,000 hotel rooms and four theme parks. But they believe there is additional revenue — more room stays, more visitors, and more themed merchandise to sell them.
"We don't have to win," Thomas L. Williams, chairman and chief executive officer of Universal Parks & Resorts, said in a recent interview. "We just have to get our share."