Launching a cruise line successfully today requires solid capital resources and a product that is differentiated and superior.

Disney Cruise Vacations has the capital resources and a management team aboard that has the experience and track-record to deliver a superior product. ln addition, "by being Disney, we are differentiated," said Art Rodney, President of Disney Cruise Vacations.

"We will appeal to the whole family, both adults and children, and non-families, that is, adults without children. We want them to be able to say "that's the best experience we have ever had when they come back," Rodney said.

Rodney said that he eventually expects to see a four to five ship operation and expanded itineraries to the West Coast, Alaska and Europe.

Meanwhile, construction cost for each of the first two planned ships is estimated at $350 million. It is also speculated that Disney will have spent another $50 million on start-up costs before the ftrst ship enters service.

Disney Cruise Vacations rolls out its marketing campaign in January of 1996 and Rodney said that "everyone in this country will know us before the first ship enters service in early 1998."

Rodney also said that Disney's entry into the cruise market will help the industry continue its recent growth rate of 10 percent per year. "I think we will open up untapped cruise markets," Rodney said.

The Disney Standard

According to Rodney, market research has shown that the new cruise line will get "a lot of trial" by being Disney. "People know Disney for its great entertainment, friendly service and good food," said Rodney. "People expect better from Disney and my job is to deliver."

Rodney said he will be challenging the other cruise lines to raise their standards.

Rodney also said that Disney will bring millions of people into cruising who otherwise may not have cruised but will be attracted by Disney.

Disney Cruise Vacations' first ship is expected to sail from Port Canaveral, with a second ship sailing from Tampa, although Rodney said that this has not been decided yet and that Miami is also under consideration.

Port Canaveral is favored since Disney also plans to develop an out-island that would have to be in the Bahamas. Rodney noted that the company will put money into the island and make it a "Disney experience."

Tampa's role depends on the development in Cuba. Rodney noted, however, the ship(s) would also be able to sail to Cuba from Port Canaveral with a service speed of 22 knots.

Rodney underscored, however, that while Disney initially will offer three- and four-day cruises "we are not entering the three- and four-day cruise market," he said. "Disney Cruise Vacations will be offering seven­ day vacations including stays at a Disney park and a cruise."

Rodney said that research had shown that over half the people visiting Disney parks said they also would like to take a Disney cruise.

Ship Concept

According to Rodney, the Disney ships will probably be in the range of 75,000 to 76,000 tons with 860 staterooms and a passenger capacity ranging from 1,720 to 2,400 based on third- and fourth-passengers in several staterooms.

"We will have the largest staterooms in the industry," said Rodney, "including family suites and connecting rooms. Families of four will be able to cruise comfortably in a stateroom," he said. adding that the new ship will also have verandas.

The ship will have three dining rooms and a three­ deck show lounge with spectacular entertainment, according to Rodney. The ship will also have extensive facilities for children and youngsters of all ages.

Building Yard

"We are in the development stage now," said Rodney, "working on our profile and general ship arrangements including room design.

"We will have specifications completed by April along with a mock-up and expect to start the bidding process then," Rodney said.

According to Rodney, Chantiers de l'Atlantique, Fincantieri, Kvaerner Masa-Yards, Meyer Werft, Mitsubishi and Newport News have indicated an interest

With technical details scant for the time being, Rodney noted that he expected ships' propulsion to be diesel electric.

Rodney also noted that even if the ships are built in the United States, he saw no advantage in flying the American flag apart from the inherent PR value.

Rodney said he expected a short list by June of 1995 and that a contract would be signed by August of 1995. Delivery is slated 27 months later and the first ship is scheduled to enter service in early 1998.

Rodney also said he expected to sign contracts for two ships right away.

Architects include Njal Eide: Yran and Storbrathen, and Robert Tillberg.

Management

Most of the senior management is on board already, including Mike Reininger, Vice President of Development: Erling Frydenberg as Vice President of Operations; Jon Rusten, Director of Newbuildings; Cliff Perry, Director of Entertainment; Tim Arntz, Director of Information Systems; and John Hemmingway, Director of Programs.

In addition, Rodney said he expected finance and marketing and sales executives to be named in the next few weeks.

Rodney also said that the officers would most likely be Scandinavian, that the hotel staff would be European and the cruise staff American.

By the end of the year (1994), Disney Cruise Vacations expects to be occupying several floors in a new nine-story building, now under construction, and have 42 employees.

Profitable

"We can make money with one ship," Rodney said, "because we are also feeding into the Disney infrastructure shoreside, putting people into hotels and parks."

Rodney noted, however, that a multi-ship fleet would be more efficient. Thus, plans call for the second ship to enter service about a year after the first.

Soon every entrant to Disney's theme parks worldwide along with hotel guests can expect to see models of the new ship and see or hear presentations on their in-room TV sets.