"Mickey Mouse Educating China's Children"

Mickey Mouse and other Disney characters have a new job in China: teaching Chinese children to speak English. Disney had licensed its animation characters to other English-language programs for the past 25 years. However, it decided to set up its own schools when it noticed a surging demand for English-language education in China. Disney's focus groups found that education means everything for Chinese parents; English, in particular, is seen as a ticket to a good career. McKinsey estimates that China's foreign-language business is worth around $2.4 billion annually. The market for children's English-language education in China is estimated to grow by 12-20 percent annually.

Disney opened its first school in Shanghai in October 2008; as of May 2011, there were 11 Disney English learning centers in China. Disney aims to teach English to 150,000 children in China by 2015.

Disney already sells merchandise in shops around China and has also produced two movies in the country. The company's next theme park is scheduled to open in Shanghai by 2016. Still, Disney has been unable to set up a television channel or distribute its full portfolio of movies in China due to the country's strict limits on foreign media.

The schools are open to children aged 1 to 11 and use a curriculum featuring Disney characters. Tuition is $2,200 a year for 2 hours of class per week. Each classroom has a local teacher and an expatriate teacher. The teaching materialsconsisting of more than 300 Disney-themed songs and 60 books must be approved by China's censors.

Disney executives say that if their efforts in China prove to be successful, the company may roll out English schools in other countries. They stress that the goal is authentic English learning, not a marketing push. Andy Mooney, chairman of Disney Consumer Products Worldwide, states: "We never saw this as an effort to teach the Disney brand. ... We set out to teach Chinese kids English." Whether the program will become a profit pillar for Disney is unclear. English First SV, a Sweden-based company with the largest network of children's schools in China sees its program as a loss leader for its adult schools and overseas study programs.

Case Questions:

1. Why did Disney decide to set up a chain of Disney English schools in China? What were the company's key motivations?
2. Is this a profitable venture for Disney?
3. In which other countries do you think Disney should introduce its English schools? Why?
4. What criteria would you use to determine in which countries to launch the program?
5. What hurdles might they face in other countries?