Disney signs licensing deal for DIC library

By DAVE McNARY UPI Business Writer

BURBANK, Calif. -- Walt Disney Co., continuing to expand its booming home-video business, said Monday it has signed a multimillion- dollar multiyear licensing deal for the DIC Animation City Inc. library.

Details of the deal, which includes more than 1,000 half-hour DIC children's shows, were not disclosed.


Disney, through its Buena Vista Home Video operation, will create a new video label for DIC programs. The deal also provides for interactive and multimedia opportunities, the companies said.

'We believe DIC is not only one of the leading producers of animation but also complementary to the product we're presently releasing,' said Bill Mechanic, president of international theatrical and worldwide video for Disney.

DIC, which has its offices within a few blocks of Disney's headquarters in Burbank, Calif., has produced 'Inspector Gadget,' 'The Care Bears,' 'Sonic the Hedgehog,' 'Supertrolls' and 'Super Mario Bros,' in addition to creating series around figures such as Macaulay Culkin in 'Wish Kid,' Hammer, and its 'Pro Stars' series with Michael Jordan, Wayne Gretzky and Bo Jackson.

Disney already is the dominant force in children's video due to its highly successful marketing of its animated library, including such hits as 'Beauty and the Beast,' 'Fantasia' and 'The Little Mermaid.'


'Beauty' sold more than 20 million copies earlier this year to break a record set by 'Fantasia.' Disney expects its home video version of 'Aladdin,' to be released this fall, to set a new record.

'Buena Vista is the 'gold standard' when it comes to family-oriented video,' said Andy Heyward, president and chief executive officer of DIC. 'They associate themselves only with the finest product and offer unparalleled distribution into the marketplace.'

Disney executives have estimated the company has a leading 22.4 percent share of the $12 billion home-video market. The business is expected to see double-digit revenue growth in the business this year with 70.4 million U.S. homes now owning videocassette recorders, with the market hitting $21 billion by the year 2000.

Disney's other successful home-video titles include '101 Dalmatians, ' 'Pinocchio,' 'Cinderella,' 'Bambi,' 'Who Framed Roger Rabbit,' 'The Jungle Book' and 'The Rescuers Down Under.'

The success of the Disney animated videos show the growing acceptance of purchasing home videos as gifts, particularly for parents wanting wholesome entertainment for their children. In recent years, analysts say, consumers have overcome initial resistance to buying a videos as prices for the videos have dropped into the $15 to $30 range.


Sales of video cassettes marked one of the few retail areas that performed strongly during recent Christmas seasons.

In addition to the high recognition of its name, Disney has the additional push coming from its 220 Disney Stores, taking advantage of Chairman Michael Eisner's strategy of 'synergy' -- using one area of the business to encourage sales in another.

In its second quarter ended March 31, operating income for consumer products increased 18 percent to a record $86.2 million on a 34 percent increase in revenues to $320.8 million.

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