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Disneys Fight To Keep Mickey

Solution Id Length Case Author Case Publisher
2261 605 Words (3 Pages) Jacob D. Hartmann University of Chicago Booth School Of Business
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There are several issues to consider while estimating the total cost of the copy-right extension of Mickey Mouse for the further 20 years. Firstly, the existing revenue generated from the Micky Mouse copy to consider while valuing the intangible asset. Currently, Disney is producing an annual turnover of US $4 Billion in global retail sales. It may be assumed that the stable revenue will be generated at the time of expiration which is close to the existing revenue. The present value of the revenue for 20 years starting from 2023 may be estimated with the expected discount rate in 2023. Similarly, the direct cost associated with this revenue may also be determined to find the present value of gross revenue in 2023.

Case Study Questions Answers

The gross revenue may further be discounted back to 8 years in 2015 to determine the existing value of the net benefit generated from the extension of the copyright. Resultantly, the remainder should be higher than the final value of the copyright extension. 

2. To make attempts to avoid Micky Mouse going into the public domain and remain in the house, Disney indulges in lobbying congress and trading campaign contributions for legislative support which cost million to Disney. The cost of lobbying may include a contribution to political campaigns including co-sponsoring of the CTEA. During 1997-2015, Disney had spent the US $87.6 Million. In recent times, the cost of lobbying was the US $3.67 Million. The cost of extension of copyrights includes the cost of lobbying. In the case where Disney would not fight the idea of setting Micky Mouse free, it may not incur this cost on account of lobbying rather the same may be directed towards the creation of additional creative content. The cost of lobbying may not be sizeable as compared to the net benefit of extension of the copyright. 

3. To avoid reporting lobbying costs in the expenditure table, Disney may take services and offer executive positions to former political and civil leaders. For example, in 1995, Disney added Former Senate Majority Leader George Mitchell to its board of directors who had well-established connections in the congress other legislators.

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