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Disney Interactive lays off nearly 700 workers, focuses on mobile
Disney Interactive lays off nearly 700 workers, focuses on mobile
March 6, 2014 | By Alex Wawro

March 6, 2014 | By Alex Wawro
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    15 comments
More: Console/PC, Business/Marketing



The New York Times reports that Disney Interactive cut 26 percent of its staff today as part of an internal restructuring effort to significantly reduce the size of the company's internal development teams. Nearly 700 Disney Interactive employees reportedly lost their jobs.

Last month we reported on rumors that Disney was planning to cut several hundred positions, primarily in its Playdom social games division, and today's layoffs seem to bear that out.

"We're not exiting any businesses, and we will pursue licensing partnerships in which we retain a lot of creative input," said Disney Interactive president James Pitaro in an interview with a Times reporter. "But this is a doubling down on mobile and an effort to focus much more intently on a core set of priorities."

This isn't the first step the company has taken to scale back its focus on social games. In November, Disney dropped Interactive co-president John Pleasants, the former CEO of Playdom up until its acquisition by Disney (to the tune of $563 million, with a possibility of $200 million more in payouts) in 2010.

For the moment, the company's fortunes seem to be tied up in console and mobile development. The Walt Disney Company's most recent earnings report claims that Disney Interactive's revenues were up 38 percent from the previous year due to the success of Disney Infinity and the growth of the company's mobile game business in Japan.

“At the same time we are reducing our focus in some areas, we are making strategic investments in others, and the Japan business is one,” said Pitaro.

Gamasutra has reached out to Disney Interactive for further comment on today's layoffs. If you have any information about this news or were affected and want to share your story, please contact us via news@gamasutra.com.

UPDATE: A Disney representative has confirmed to Gamasutra that Chicago-based Wideload Games, acquired by Disney in 2009, has been shut down as part of the restructuring.


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Comments


Gary LaRochelle
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Ouch.
Best of luck to those laid off.

Ben Sullivan
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Did this affect the Canada (Kelowna, BC) office at all?

Michael G
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You have to wonder if the management feels a great injustice that other studios are doing well while they are left to suffer. Clearly they would never need to consider the possibility that they should make good games instead of pandering to their existing IPs.

Wes Jurica
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"Good job Disney Interactive team members! Disney Infinity was a great success thanks to you. As a special bonus this year I give you this pretty piece of paper. Notice the rosy hue?" - Some A-Hole Exec

Robert Carter
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Actually, it is my understanding that the Infinity team was largely untouched by this. Nearly all of the layoffs were related to social media and mobile games (such as Playdom).

A bit of trivia not known to many outside TWDC; Disney Interactive has failed to turn a profit in the 15 years it has existed. Infinity may be the game changer in this regard, and DI is treating the team as very important to the company.

Wes Jurica
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Thanks for the info. I get pretty knee-jerk, cynical when I hear layoff stories.

Ken Love
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Uh… "Isn't this the norm for Disney?"

If I recall correctly, LucasArts was the same way."

Hire and Fire.

As much as I hate to say it, anyone ever considering going to Disney, REALLY.. needs to consider their gaming history before going to work for Ricky Rat. Yes, they've got some incredibly popular well known brand names that are way attractive to develop for... BUT.. for as long as I've been in the industry (24 Years now), their Hiring and Firing practices has never changed.

They try to make gold themselves and end-up spending way too much time and money and fail. They then kill-off their own internal teams to license the stuff out to the highest bidder. Those external teams do well and make a little bit of money. Disney sees this and says "Screw it! We're the house of Mouse and we need not let anyone else do it. We'll do it ourselves!" Hence, they start the hiring process all-over again.

This seems to be the Disney Interactive gaming development cycle.

Ask anyone else who's been round for awhile. They'll likely tell you the same. LucasArts did it the same way.

As you can see in their statement up above… "We're not exiting any businesses, and we will pursue licensing partnerships in which we retain a lot of creative input."

That said, they just realized they've spent way too much doing internal development. Now, we'll go back to the licensing-out bit.

Someone correct me if I'm wrong, but.. I really don't think I am. :-/

- Ken

John Maurer
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That seems to be the industry as a whole Ken, EA and Activision-Blizzard are no different

IS Sil
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I am a DI employee and can confirm this is 100% true. The real problem is in upper management.

Ken Love
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You have my condolences, pal. :-/

All I can say is.. "Let Dismal eat $hite pie with a Mickey and Minnie bride and groom statue on-top." Perhaps the next time they have layoff's, they should consider the people at the top first. The one's that SUPPOSEDLY are the brainiacs making of all of the so-called SMART decisions.

But.. that's not the way it works, sadly. They usually go unscathed… or as like what typically happens with alot of Japanese publishers, these half-wits fail upwards. Meaning, they're promoted. :-/

Oh well, it is what it is.

These days, I think a person's better off going indie.

There is no safety in working for a big publisher anymore. There used to be SOME awhile ago, but.. not really anymore. "It's the Gaming industry." If ya' wanna' stay in it, get used to it.

- Ken

Alan Barton
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Workplace Psychopath thinking:
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Director1: "Disney Interactive's revenues were up 38 percent from the previous year!"

Director2: "We can cut 700 employees and make huge savings!"

Director1: "Great!, then we can claim huge bonuses for earning the company so much money!".

... note how they have no empathy for the work and lives of their employees ... they are only thinking of themselves.

Scott Lavigne
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Note how your dialogue is completely fictitious and not very likely to be representative of the situation.

Alan Barton
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@Scott Lavigne,

I used humor to get my point across, but its very clear how you have tried to play a straw man attack by ignoring that, in your attempt to distract away from what I said, without you addressing the fact that the directors knew the improved performance of their company, whilst they choose to throw about 700 people out of work!

... how the hell you could choose to defend them by attempting a straw man argument against me is beyond me.

So how the hell anyone can vote you up is jaw dropping. The directors knew what they have done. 38% increase + about 700 redundant are facts. Directors earn from finacial success of their company. Amazing.

[User Banned]
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This user violated Gamasutra’s Comment Guidelines and has been banned.

Stewart Spilkin
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Not sure what your point is. All jobs are temporary, as is life itself. Are you saying its ok to treat people like trash because its all going to end anyway?

Yes, I'm sure there is tons of wasted and misdirected effort, but the most likely explanation for that is not untalented developers, but poor planning and leadership. I think Alan's point is that it's sad that talented developers who could just as easily make something successful as not are the ones that inevitably pay.


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