Layoffs expected at Disney Interactive


According to a report in the Wall Street Journal (paywall), The Walt Disney Company’s video game division, Disney Interactive, will soon shed “several hundred” employees.

The gaming unit, which current employs around 3,000, has had its ups and downs over the years. Their line of business depends a lot on how well games are selling.

The good news is that the new Disney Infinity playsets are very profitable. Disney is reportedly adding Marvel and Star Wars related playsets soon. Which should help extend the game play and add tens of thousands of new players who were waiting for those characters to be added.

The bad news is that the video game industry is currently dominated by Apps and online play, neither of which are as profitable as the big name console game system titles in the past.

Games previously announced for Disney Interactive like “Fantasia: Music Evolved” for the Xbox which promised to take musical motion video to the next level, “Castle of Illusion starring Mickey Mouse” a reimaginging of the Sega Genesis classic, and “Duck Tales Remastered” either never materialized or never gained a mass audience.

Where Disney Interactive goes from here is a good question. The division did show profitability last quarter, the first time for that in a long time. This “re-organization” (I hate that term) should help too. But will they be forced to producers fewer ‘tent-pole’ titles, a system that has worked well for the studios profit line, but hurt their creativity, or will Disney Interactive find a way to make Apps and online play finally work.

I can’t wait to find out. What is your prescription for future success at Disney Interactive?