An insight into the future: What happens when Disney’s Magic Band system goes down?

Joshua Gans
Mar 21, 2015 · 2 min read

Actually, it wasn’t a complete disaster.

First, some context. We visited Disney World in Orlando last week and were fitted with Disney’s Magic Bands. The idea is that you don’t need a wallet, room key, ID or anything. Just the band.

This system works. On March 10th, Wired released a gushing overview of the system. They declared it an insight into the future. Imagine a world where it all works like Disney using some sort of smart watch. Disney has implemented this in a closed environment and has now demonstrated it can be done. And it isn’t just done in that it kind of works. It is done in that it works in precisely the seemless way you would expect. It is really rare to see a vision so well fulfilled.

But on the very next day, the Magic Band system went down and I was there to see it happened. And by went down, I mean totally. Apart from getting into your hotel room, the Magic Bands no longer worked. That meant, no fast passes, park entry, paying for stuff including dining plans. And this happened not just in Orlando but in Anaheim, Tokyo, Hong Kong and Paris. This was a Mickeypocolypse.

Of course, this is what an experiment is all about. What happens when the system goes down?

Recall that Magic Bands are currently our vision of the cash-free future: a world where we no longer have wallets. So if the system goes down that is equivalent to the financial system collapsing.

Disney were prepared for this. It would have been disturbing had they not been. They asked for credit cards but if those weren’t available they moved to record transactions and bill later. It was clear that while the ‘cast members’ weren’t having a good day, they knew what to do. To be sure, there was a risk transactions might not be completed and someone could engage in fraud on the system. But for Disney it would be a meal here or there or worse some park entry. So long as it didn’t occur too often, the system would cope and Disney could wear the cost. My hunch is those costs were few.

I didn’t get to experience what happened to the Fast Pass system but one can imagine an honor system would have sufficed there as well.

This has happened when banks have closed. This happened in Portugal and businesses made do with their own transactions record. Disney appear to have opted for a similar response.

The question remains, however: is will this be possible if we switch, as a society, to a Magic Band type world? Something tells me that baking backup into the design might be a good way to go.

Joshua Gans

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Skoll Chair in Innovation & Entrepreneurship at the Rotman School of Management, University of Toronto. joshuagans.com and digitopoly.org