Monopolies Not As We Know Them

Some companies are so big they can choose to reject customers.

CNN informs us:

On Thursday, Disney announced that starting May 1, smoking and certain large strollers will no longer be allowed inside Florida and California Disney parks, including Walt Disney World, Disneyland theme parks, water parks, ESPN Wide World of Sports Complex and Downtown Disney.

Guests who smoke will still be able to light up in designated areas outside park entry points and in smoking areas at Disney Resort hotels and Disney Springs.

Smoking has been increasingly frowned upon for decades. Where once almost every public place at least provided a smoking section, now most actively forbid smoking, even outdoors.

This is both democratic and capitalist.  More people don't like smoking than do, and those that don't are offended by the smell, so it makes sense for places used by everyone - restaurants, aircraft, office buildings - simply to ban the practice.

It takes a super-sensitive schnozz to be offended by smoking in the great outdoors, though, and even more so in a place like Disney: their decades-old smoking areas are thoroughly screened off from public view and breezes.  Having them costs them nothing and makes certain guests more comfortable - ok, no doubt a comparatively small and shrinking number of guests, but isn't their money as good as anyone's?

Not according to Disney.  The giant corporation that operates the parks has decided to now say, hey, if you want to smoke - we don't want you around.  Keep your money for cigs!

Where's The Competition?

According to the free-market principles beloved of conservatives, this is fine.  If one business chooses not to serve a given sort of customer, two things will happen: their prices will have to fall since they will have lower demand for their product, and some other less bigoted competitor will arise to serve the unmet need.

This is, in fact, what has always happened everywhere that racist practices extended into business.  In the Jim Crow South, there were plenty of main street department stores and lunch counters that refused to serve blacks.  Almost always, there was another establishment not far away, often owned by a Jewish family, that happily would serve people regardless of color.  That's why it wasn't enough for racist business owners to choose not to serve blacks, their lower status had to be required by law and enforced on everyone, even those who did not want to enforce bigotry.

Obviously there's no moral comparison between smoking, which is disgusting and which you freely choose, and being black, which is neither.  Raw economics doesn't care about morals, though; if there's an unserved market, the Invisible Hand almost always comes up with a way to serve it.

Which brings us to Disney.  Pre-civil-rights-era southern blacks may not have been welcome at Woolworth's lunch counter, but they could always grab a burger at Abe's Grill - odds are, a better and cheaper one anyway.  Food is food, and one restaurant readily substitutes for another.

What substitutes for Disney?  If you want to see Mickey Mouse, there's only one place to do it, thanks to a century of Disney lobbying to eternally extend copyright laws and frustrate the invisible hand.

Does this mean that we ought to force Disney to cater to smokers when they, a private business, don't want to?  No.  But isn't it a bit disturbing that they're able to simply brush off an entire category of customers?  Doesn't this fly in the face of economic laws?

It's Just Too Hard

The discipline of economics is the study of scarcity.  Disney knows very well who controls Mickey Mouse scarcity: they do, regardless of market forces.

As large as they are, the Disney parks have a maximum capacity which, these days, are reached more and more frequently.  It's generally estimated that Disneyland tops out at 80,000 guests, and as that link shows, it's not unheard of for Disney to simply close the doors and not let anyone else in when they react that point.

In one sense, Disney is making the economically sensible decision: prices keep going up.

The Disneyland Resort in California raised prices across the board on tickets and annual passes this morning, with some one day-ticket prices rising over 10 percent and top annual passes going up by more than 20 percent.

Disney World is larger and less prone to completely jamming up, but even there, they're using pricing to try to spread out the load.

Walt Disney introduced variable pricing at its Florida theme parks last October. Designed to entice consumers to visit during less crowded times, the pricing plan made tickets more expensive on higher-traffic days. Now the company has once again raised its prices for single-day tickets during the peak Christmas period.

So far, so conventional: the park already exists, so it makes sense to try to run it as close to maximum capacity all the time.  But if the Disney parks are running so full, wouldn't you expect them to build more of them?

Except that they've already tried that: there is a Disneyland Paris, one in Tokyo, in Hong Kong, and now another paean to capitalism in mainland China.  At the original rather small Disneyland, they got rid of the parking lot a few years ago for a giant expansion, California Adventure.

Your humble correspondent was privileged to visit both Disneyland and California Adventure last year on back-to-back very long and very expensive days.  Disneyland was everything it has always been.

California Adventure... not so much.  It certainly looked like it was built by the same people - beautiful park design, solid engineering, etc.  But it seemed like it was run by a totally different company: from haphazard, badly thought through guest flow to poorly-sited and hard-to-find restaurants, it couldn't hold a candle to the decades-older park despite the benefits of years of experience and countless billions more dollars than Walt himself ever had.  And somehow this lesser facility came into being with the original example literally across the street.  Actually building world-class Disney parks must be more difficult than it seems.

We have not been at any of the overseas parks, but Disneyland Paris has always struggled, and many of the others are said to have some maturing to do.  Apparently it takes more than billions of dollars to replicate a legend.  A touch of pixie dust, perhaps?

Which means that Disney parks are in an odd position economically: they have so much demand that they can easily turn away customers they choose not to prefer, but lack the ability to effectively increase capacity so as to serve all the customers that would like to come at their current prices.

Your Bias Is Showing

So, given that Disney has the luxury of beign biased against disfavored groups without paying a price, who do they choose to cold-shoulder?  We've already discussed how smokers are no longer welcome at Disney parks.

Back in the 90s, Disney, once the bastion of all things family-friendly, allowed "Gay Day" when the park is overtaken by homosexuals, the exact antithesis of traditional families.  Although it is not an "official" event in the sense of being specifically organized by Disney, it's certainly well promoted and supported by them and has been all along.  Even Wikepedia admits some of this goes too far:

Drug use and overt sexuality have caused some lesbian and gay people to oppose the event.

As you might expect, conservative Christians attempted to pressure Disney via a boycott.  The Southern Baptists, America's largest religious denomination as well as one geographically located relatively nearer to Disney World, voted for offical boycotts for years.  Other Christian organizations do the same, right down to this day.

Even in our post-Christian society, there are a lot more Christians than there are homosexuals, and biology being what it is, a great many more children of Christian families than of homosexuals, supposedly Disney's prime market.  What effect did these boycotts have?  None whatsoever: Gay Day has only grown in the intervening decades.

But that's not to say that Disney had no response:

There will be no Night of Joy event at Walt Disney World in 2018, and there are no plans for the series of Christian-music concerts to return to the resort in the future, a Disney World spokeswoman has confirmed.

“Last year was our last event,” the spokeswoman said Thursday.

The event began in 1983 at Magic Kingdom, where it remained for most of its 35-year run.

That's right: Disney continues to welcome throngs of homosexuals who mostly don't have kids and cancels an event targeted at Christians who largely do.  What sort of economic sense does that make?

It doesn't matter: Disney still sells just about as many tickets as they are capable of selling, so they lose nothing.  They can cherry-pick the customers they want to have, and if you aren't among them - tough noogies!

As a private enterprise, they have a perfect right to do this; the last thing we would recommend is any sort of government interference in this type of free business decision.  But it's an odd state, isn't it, where Disney World is so popular and so rich that a giant corporation can afford to make this kind of choice?

Petrarch is a contributing editor for Scragged.  Read other articles by Petrarch or other articles on Business.
Reader Comments

I am now very allergic to cigarette smoke. It gives me Asthma. I am happy that I can now eat a restaurant that is smoke free and not worry about getting Asthma and having to leave before I finish my meal.

April 15, 2019 1:07 AM

Disney may be the pick for this article but what about the monopolistic tech giants and media moguls that censor and harass conservatives. It's legal for now until a backlash changes this course of events.

April 21, 2019 8:15 PM
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