Confirmed: Disney Interactive Hit with Layoffs
GameDaily BIZ has confirmed with Disney that it's consolidating studios in Salt Lake City and it's also cut some staff at Propaganda. Details within...
by James Brightman on Thursday, January 29, 2009
Confirmed: Disney Interactive Hit with Layoffs
It's as if every company has gone into panic mode and decided that layoffs are a must right now. Perhaps these companies should consider some alternative cost cutting measures. The latest to join the layoff party is Disney, which is apparently taking the ax to Disney Interactive Studios and other businesses, Kotaku has discovered.
GameDaily BIZ briefly spoke with Angela Emery, Vice President of Communications at Disney Interactive Studios, who confirmed the layoffs. However, Kotaku's sources were a bit off. Vancouver-based Propaganda Games, the developer behind Turok, is cutting under 30 staff (Kotaku had reported 70). Kotaku's sources also said this is likely tied to the rumored cancellation of Turok 2, which was never officially announced by Disney. Emery would not comment on the status of a Turok sequel, but she did say that Disney still holds the rights to do one. Turok was not a blockbuster hit but it did well enough to satisfy Disney it seems, and Emery said its performance was "nothing embarrassing." She also said that Propaganda remains a two-team development studio and is working on two unannounced projects.
The other part of Disney Interactive's layoffs involves some restructuring. Emery confirmed that the Fall Line Studio will be consolidated into Avalanche, both studios being located in Salt Lake City, Utah. These studios have worked on popular Disney properties such as Bolt, Chicken Little, Hannah Montana and The Chronicles of Narnia. The consolidation will result in "less than 20" employees getting laid off. Emery said it gives the company some "efficiencies" and it "puts Wii and Nintendo development at the forefront... giving Avalanche some additional development capacities." She added, "[The Wii] is a very important platform for us, of course."
Finally, Emery stressed to us that Disney Interactive's other studios such as Black Rock, Junction Point and others were not at all affected by the round of layoffs.
Kotaku managed to snag internal communication forwarded to remaining employees from Steve Wadsworth, President of the Walt Disney Internet Group. Wadsworth explained Disney's situation: "As you can imagine, given economic conditions, every industry has been impacted on a global scale. In response to this challenging business environment, we have examined ways in which we might be able to work more efficiently. We have taken measures to control costs by freezing most open positions, deferring some capital projects, reducing support from third parties, taking significant reductions in travel and entertainment expenses and eliminating other activities. The elimination of existing positions that we communicated today was a necessary step that we had hoped to avoid. In addition to all of these changes, we have also determined that Directors and above will not be receiving merit increases this year. All of these actions are part of a focused effort to ensure we are closely managing the organization through the current economic climate, balancing our need to respond to the current environment with our goal of driving significant long-term growth."