Disney Is Poised To Benefit From Potential Thaw In China-U.S. Relations, Wall Street Analyst Says
17.11.2023 - 20:37
/ deadline.com
Disney is poised to be the top entertainment industry beneficiary of a potential improvement in U.S.-China relations, according to a veteran Wall Street analyst.
On the occasion of talks in California this week between China’s Xi Jinping and President Biden, Tim Nollen of Macquarie singled out Disney, ad tech firm The Trade Desk and video game software maker Unity as having the most to gain from the diplomacy. China recently has become more isolationist and less democratic, by most measures, and the Biden Administration has made it a priority to mend relations after predecessor Donald Trump waged a trade war against China and engaged in other saber-rattling.
Disney’s “long history” of doing business in China makes it “a truly global brand relative to other traditional U.S. media companies,” Nollen wrote in a note to clients. Disney originally started licensing its products and characters for use in China in the early 1980s, he noted. The company went on to build two theme parks in partnership with the Chinese government and find success at the box office with major tentpoles. Recently, however, film releases have become “strained,” Nollen observed, though it is notable that media rivals like Netflix have no presence in China and no plan to enter the market.
In addition to the diplomatic talks possibly restoring some vitality to the box office and the retail sector in mainland China, Nollen laid out a case for reciprocity rather than just a one-way relationship. The touchstone moment in modern relations between the two global powers, Nollen recalled, came more than a half-century ago when an international tournament match in table tennis was contested in 1971 between players from the U.S. and China. The resulting
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