The Walt Disney Company (NYSE: DIS) is a leading media and entertainment conglomerate. The company is divided into five major business segments: Media Networks (including the ABC network), Parks and Resorts, Studio Entertainment (including Pixar), Consumer Products and Interactive Media. Under the leadership of its new CEO, Bob Iger, Disney has renewed its emphasis on its core strategy of creating and distributing attractive content for children and syndicating this content through its various entertainment channels. For example, when Disney produces a new movie, it continues to capitalize on the characters in the movie long after it has left the box office. Before the movie leaves theaters, the company will have already released a line of complementary toys and action figures. This is followed by the release of the movie on DVD and - depending on its popularity - a presence in Disney's theme parks or its own television show.
In line with this strategy of maximizing the value of its content, Disney recently began distributing its content in new ways, such as video-on-demand online and television shows formatted for video iPod users. Although distribution through these new mediums comes with significant risks of piracy, the migration of younger audiences (Disney's core customer base) away from traditional television to new media makes finding new ways to reach out to this demographic critically important. Disney has also invested $350 million to develop its own in-house video game development capabilities.
In another major acquisition, Disney purchased comic book company Marvel for $4 billion in cash and stock in 2009. The purchase gives Disney the rights to 5000 Marvel characters, including Spider Man, X-Men, and Iron Man, and their associated royalty and licensing revenues from games, movies, clothing, toys, and theme park rides. 
The Walt Disney Company was founded in 1923 as a movie studio, and its iconic Mickey Mouse character appeared for the first time five years years later. In 1955, Disneyland Resort opened in Anaheim, California, and the company went public two years later. Over the following decades, Disney continued to expand, acquiring film distributors and perfecting its model for consumer product merchandising. In 1996, Disney acquired ABC, and in 2006, Disney finally purchased its long-time partner Pixar, though the two had a previous distribution agreement prior to the acquisition.
The Walt Disney Company divides its operations into five business segments: Media Networks, Parks and Resorts, Studio Entertainment, Consumer Products, "Disney Interactive".
Overall advertising spending is largely driven by the economy, as well as by the presence of large-scale TV events like the Olympics. Disney's ABC has recently achieved success with shows like Lost, Grey's Anatomy, and Desperate Housewives. Advertisers are willing to pay more for airtime during shows like these because they attract large numbers of viewers. Similarly, ad prices spike during playoff sports coverage and Superbowl coverage. A very disappointing sports season or flagging TV show ratings can significantly hurt advertising revenues, as does a general economic downturn
Sensitivity to short-term fluctuations in advertising spending are somewhat offset by steady revenues from cable networks' affiliate fees, which tends to provide a more stable revenue stream.
However, a large portion of affiliate fees come from sports coverage channels in the ESPN network, where the cost of sports coverage is rising. Extended increases in sports coverage cost may materially affect operating income after 2013, when Disney's current contracts with broadcasters will expire.
With the decline of traditional media to favor of influential technologies like Youtube and Apple's iTunes/iPod, it becomes necessary for media conglomerates to learn how to tap into these channels to access the audience and the advertising revenue. Disney recently began to post both full videos and clips of its programming online at ABC.com, ESPN.com, and Disney.com. In addition, Disney has begun to sell ABC content for use on iTunes and video iPods. These are new initiatives, but they have been very popular and could be a considerable source of future growth.
The Studio Entertainment division's revenues are subject to conditions in the larger movie industry, including the rate of movie attendance. In recent years, the advent of online video and a rising amount of piracy has led to slow or flat growth in movie attendance, causing studios such as Disney to reevaluate their film distribution methods. One way the company has addressed declining cinema viewership is through enhancing the consumer movie experience, such as filming shows in I-MAX and 3-D. In the future, film studios are expected to focus more on the higher-margin DVD and television broadcast segments as a result of this decline in cinema viewership.
The DVD market has begun to mature over the last 2 years. Consumer spending on home videos dropped by about 2% in the past year. Fortunately, For Disney which derives a large portion of its revenues from syndication of its content the impact, however, as DVD sales growth has not slowed as much for Disney's target audience.
As children grow up, they tend to trade their toys for more sophisticated forms of entertainment such as video games. However, children are making switch earlier and earlier, a phenomenon termed as "age compression", so the market for video games is growing larger. Disney, however, does not currently have a large presence in this rapidly growing video game market, though the company is making large investments in this area. The vast majority of games released by Disney are geared to lower grade level children, whereas the vast majority of children would rather play games and not bother with educational games, no matter how cute the character is. Games such as Kingdom Hearts is a good example.
Disney's major competitors are the other large media conglomerates, such as News Corporation (NWS), Time Warner (TWX), Dreamworks Animation SKG (DWA), and Viacom (VIA), who directly compete with Disney in various business lines.