Mass Layoffs Rumored at Disney Interactive [Updated]

[Update: 13:24] Disney Interactive has issued a statement confirming layoffs, but stopping short of giving details: "As part of setting a strategic...

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[Update: 13:24] Disney Interactive has issued a statement confirming layoffs, but stopping short of giving details: "As part of setting a strategic direction for future success in the digital media space, the Disney Interactive Media Group yesterday began a restructuring process."

[Original Story] Rumors are circulating today that Disney Interactive has been been hit by widespread layoffs, throwing the status of its premiere studios into question. Sources told Joystiq that this is the "first round" of layoffs, and includes 250 employees.

Word came late yesterday that Junction Point, the team behind Disney Epic Mickey, suffered layoffs, though we aren't sure yet on the studio's status. Sources claim that Junction Point head Warren Spector's fate will be different than the rest of the team. We also haven't heard word yet on how this will impact Split/Second developer Black Rock Studios.

Late last year, Propaganda Games was hit with heavy layoffs as Disney ceased development on Pirates of the Caribbean: Armada of the Damned. The studio was subsequently closed last week. Disney didn't give a specific reason for the cancellation.

Despite a mixed critical reception, Epic Mickey sold reasonably well, coming in at #6 on NPD data during one of the busiest shopping months of the year. Rumor has it that the game didn't sell as well as expected.

We've reached out to Disney for official word, but have yet to hear back at the time of publishing.

Editor-In-Chief
From The Chatty
  • reply
    January 25, 2011 8:16 AM

    Since I worked this story extensively yesterday, here's a few more details...

    The layoffs are significant - and Disney Interactive Studios was part of a massive restructuring. The company is not supplying exact numbers, but up to half the division may have been let go.

    Warren Spector is still with Junction Point and does not appear to be going anywhere. Layoffs there were minimal, and seem to be tied to the normal 'game over and it's time to let the contractors go' cycle that's commonplace in the gaming industry.

    I won't repost the CNBC link again, since I've pimped that enough, but it's in my post history. Ugly, UGLY day at DIS, which is a shame, because they really did seem like they were about to turn the corner, but management got too impatient.

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      January 25, 2011 8:29 AM

      why does everyone worry whether Spector will land on his feet or not?

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        January 25, 2011 9:08 AM

        Because we have to believe that a guy that made one good game is capable of doing it again. But, to do so, he has to land somewhere with resources for him to use.

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          January 25, 2011 5:06 PM

          I would wager that you'll never get a game the quality of Deus Ex from warren again. Times have changed.

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      January 25, 2011 9:27 AM

      You don't need that many people to make a game. Good riddance.

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        January 25, 2011 9:33 AM

        Do not feed the troll.

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      January 25, 2011 9:49 AM

      Someone I know there just said 700 people got the boot. Luckily she wasn't one of them, her studio has only just been bought and they got away with some restructuring.

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        January 25, 2011 10:48 AM

        Prolly in the social games area then...

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          January 25, 2011 11:21 AM

          I thought Disney was focusing heavily on the social games area, rumored to be to the point where they're getting out of retail console and PC games entirely.