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Op-Ed: Woes continue for suicidal SeaWorld as it eyes foreign markets

By Elizabeth Batt     Aug 19, 2014 in Business
With shares of SeaWorld Entertainment, Inc. (SEAS) plunging nearly 34 percent, the decline of SeaWorld in just 19 months is not a surprise. Now the park is eyeing overseas partnerships.
Still reeling after its stock dropped by over a third last Wednesday, SeaWorld is scrambling to pick up the pieces. With a lackluster second quarter performance and attendance down, SeaWorld blamed recent legislation in California called the Orca Welfare and Safety Act.
Hit yet further by Standard & Poor's downgrading of SeaWorld Entertainment's credit rating to that of "junk bond" status, several analysts have posed the question, "how did SeaWorld get here?"
Most chose to focus their attention on a damning documentary by Gabriela Cowperthwaite called, 'Blackfish'.
"Denial ain't just a river in Egypt" — Mark Twain
It wasn't until 'Blackfish' had premiered at the Sundance Film Festival in Park City, Utah on Jan. 20, 2013, that SeaWorld issued its first real response:
Based on our very preliminary review ... 'Blackfish' appears to repeat the same unfounded allegations made many times over the last several years by animal rights activists. Importantly, the film fails to make the most important point about SeaWorld: the company is dedicated in every respect to the safety of our staff and the welfare of animals.
Two months later, when SeaWorld Parks and Entertainment CEO Jim Atchison was asked about any negative effects caused by 'Blackfish', he told the San Diego Union-Tribune:
With respect to the impact on our business, as much as we're asked it, we can see no noticeable impact.
But that was then.
"Once you see it, you cannot unsee it," said Dr. Jeffrey Ventre, a former SeaWorld trainer who was featured in the film. "Blackfish is a one-way door."
It took almost six months for SeaWorld management to realize that the documentary was having a far larger impact than expected. Refusing to acknowledge this publicly, SeaWorld opted for a sneak attack by hiring a film publicity outfit called 42West. The company targeted film critics via an email with a subject line that read: 'A Dishonest Movie.' The missive said, in part:
In the event you are planning to review this film, we thought you should be apprised of the following. Although "Blackfish" is by most accounts a powerful, emotionally-moving piece of advocacy, it is also shamefully dishonest, deliberately misleading, and scientifically inaccurate.
Tor Myhren, Worldwide CCO of Grey Advertising in New York told the Pasadena Weekly SeaWorld's move was a huge mistake:
From a marketing perspective Sea World did completely [mess] up. When the film was about to launch, it really did not have a lot of momentum at all. It had done well at Sundance, and then it kind of went quiet. Two days before the film hit the theaters, SeaWorld for some idiotic reason sent out that email. The next day, of course, everyone who received it sent it to the press, and it just exploded. Within 48 hours the movie went from not being known at all to being the most talked-about documentary of the year. It was a classic PR mistake by SeaWorld.
To compound the issue further, 'Blackfish' received rave reviews from the New York Times, the Los Angeles Times and Variety. It made the shortlist for an Academy Award, was a finalist for Best Documentary at the BAFTA's, and won several film awards under its own merit.
But it was CNN Films who truly served it to the public sphere. Having purchased the rights to the documentary, CNN screened it to almost 21 million people last October. It went on to became one of their most popular films, and the furor it sparked, was unprecedented.
Soon, famous acts began to cancel their performances at the park. Barenaked Ladies, Willie Nelson, Heart, Trisha Yearwood, REO Speedwagon, Martina McBride and others, all ditched the SeaWorld venue citing animal concerns. Videos surfaced lamenting the park's practices. This one, featuring actor and comedian Jason Biggs, slammed the park. "Nothing gets me in the mood more than watching a giant over-masturbated whale, swim around in a tiny bathtub," said Biggs.
Protests grew and anger flew, forcing SeaWorld to go on the defensive.
"I would prefer even to fail with honor than win by cheating" — Sophocles
The park formed a 'Truth Team' to offer its own analysis of 'Blackfish'. Producing a 69-page document to counteract specific points of the movie, their credibility was blown when they misrepresented a scientist's research.
"Nearly one-quarter of adult male southern resident killer whales in the wild have collapsing, collapsed or bent dorsal fins,” SeaWorld wrote, citing a paper written by Dr. Ingrid Visser, a leading expert in New Zealand orca.
"Firstly, my cited paper is about New Zealand orca, not a population found off the west coast of North America," Visser said. "Any orca biologist worth their salt would know that," she told Digital Journal last May.
From SeaWorld s rebuttal to Blackfish. p.18
From SeaWorld's rebuttal to Blackfish. p.18
SeaWorld
It was a mistake SeaWorld's Todd Robeck confessed to in a round table discussion hosted by Voices of San Diego last June. How the research had been used Robeck said, was "misleading."
The discussion did not go well for SeaWorld. Saying that, Robeck appeared to at least think for himself some of the time, but he was easily overshadowed by science. When difficult questions arose, Robeck and the SeaWorld trainer at his side were often defensive, their responses bordering on attacks.
"Integrity is the essence of everything successful" — R. Buckminster Fuller
Plunging stocks may have served SeaWorld with a reality check. The severing of a 25-year-old partnership with Southwest Airlines, might have accomplished the same.
But it doesn't appear so.
SeaWorld released its own announcement. It would provide bigger tanks for its orcas and look at potential investment overseas. The "Blue World Project" it said, would almost double the size of its current orca habitat, beginning with the park in San Diego.
SeaWorld leases the land it is built on from the city of San Diego. It is located in Mission Bay, an area that the park received fines for, over polluting the bay with animal waste.
"It's hard to believe that SeaWorld can begin digging a massive hole on city property, with additional water treatment equipment, without due process," says Voice of the Orcas, a group of four ex-SeaWorld trainers featured in 'Blackfish.'
So has the city already approved the extension, or is SeaWorld taking another risk?
Certainly in its forward-looking statement, the corporation acknowledges that the 'Blue World Project', is delicate:
The forward-looking statements are not historical facts and are based upon current expectations, estimates and projections, and various assumptions, many of which, by their nature, are inherently uncertain and beyond management's control. All expectations, beliefs and projections are expressed in good faith and the Company believes there is a reasonable basis for them. However, there can be no assurance that management's expectations, beliefs and projections will result or be achieved and actual results may vary materially from what is expressed in or indicated by the forward-looking statements.
"SeaWorld is in a tough business," said Business Insider, pointing to the park's annual report filed with the SEC on Form 10-K:
In February 2010, a trainer was killed while engaged in an interaction with a killer whale ... this incident and similar events that may occur in the future may harm our reputation, reduce attendance and negatively impact our business, financial condition and results of operations.
But this isn't new. SeaWorld acknowledged the potential for backlash and negative consequences back in early 2013. David Kirby reported that shortly after filing its prospectus, SeaWorld had to amend the paperwork to include the same statement written above.
SeaWorld's woes are far from over. Yesterday, an investigation on behalf of investors of SeaWorld Entertainment Inc (NYSE:SEAS) was launched over potential securities laws violations by the company and "certain of its directors."
The Rosen Law Firm announced, "it was preparing a securities class action lawsuit on behalf of purchasers of SeaWorld common stock to recover their investment losses," after, "stock dropped by $9.25 per share, or 32.9%."
"Most of us can read the writing on the wall; we just assume it's addressed to someone else" — Ivern Ball
SeaWorld has ignored the writing on the wall for almost two years now. The company's idea of evolution seems to be one that will always involve the display of captive cetaceans for profit. In announcing its share repurchase program, the company revealed several new potential partnerships:
Turning to our international efforts, we continue to make significant progress in our plans to expand our theme parks outside the U.S. We recently signed a Letter of Intent with Village Roadshow Theme Parks, a division of Village Roadshow Limited, a leading international entertainment and media company, to co-develop theme parks in Pan-Asia, India and Russia. This Letter of Intent, along with our previously announced Memorandum of Understanding with our partner in the Middle East, creates exciting opportunities to extend our brands beyond our domestic borders.
It is something Ventre saw happening a long time ago:
In regard to SeaWorld taking it's cruel circus "on the road," that was predictable. I talked about it at the very first Q&A at The Sundance Film Festival, before SeaWorld announced its plans. I called out, by name, "Russia, China, and the Middle East." This was totally predictable. These animals are worth millions and SeaWorld will take them to places where they are easier to exploit due to less regulation.
Bottlenose dolphins are taken captive after being driven into a cove in the Japanese town of Taiji  ...
Bottlenose dolphins are taken captive after being driven into a cove in the Japanese town of Taiji, January 19, 2014 in this photo by environmentalist group Sea Shepherd Conservation Society
, Sea Shepherd Conservation Society/AFP
How easy to exploit? Alongside Japan, Russia is directly involved in the cetacean procurement business; China is the largest purchaser of dolphins directly captured in the Taiji dolphin drives, and as for the Middle East, writes Marine Connection:
The Palm Atlantis development imported 28 wild-caught dolphins, taken from the population in waters surrounding the Solomon Islands ... and the Dubai Dolphinarium at Marine World (Creek Park), holds dolphins imported from Ukraine and also dolphins taken from the notorious annual drive hunts in Taiji, Japan.
SeaWorld could choose to be a hero and evolve with public sentiment. But as Alex Johnson wrote at The Drum, "SeaWorld was a staple part of the tradition of American amusement parks and perhaps, for this reason, it began to consider itself invincible." With a refusal to recognize that others may not share its views Johnson said, "SeaWorld must respond in an open, mature and constructive manner."
"I don't think SeaWorld speaks the language of ethics, of right and wrong," Gabriela Cowperthwaite told TheWrap, "but they do speak revenue."
SeaWorld's revenue is tied to the public who purchases its tickets, but its customers are increasingly leaving the company behind. With SeaWorld hesitant to evolve with them, they could find themselves rattling an empty bucket— at least in the United States.
This opinion article was written by an independent writer. The opinions and views expressed herein are those of the author and are not necessarily intended to reflect those of DigitalJournal.com
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