700 Employees Laid Off at Disney Interactive

Square Enix / Disney Interactive

Things aren't as cheery in the Magic Kingdom as we'd hope after hearing about this staggering amount of layoffs at Disney.

The New York Times has reported that Disney's Video Game and Internet Division handed out pink slips to approximately 700 employees, which made up 26 percent of its global staff.

These layoffs have been a long time in the making due to Disney's declining numbers in terms of its internet and gaming content. Disney has combined its mobile games development team with its social games team. This combines both app and iOS game creation along with the development of social media applications, such as Facebook games.

Disney has also decided to substantially backtrack on the in-house development of all games, focusing on hiring third party developers for its titles and licensing Disney trademarks out to other developers as well. Disney will also put a major focus on the advertising of its future projects so consumers will actually be aware of whenever digital content is being released.

Disney Interactive Studios will have its annual output reduced by 50 percent. Disney Interactive is known for the likes of the Spectrobes, Star Wars: Battlefront, Epic Mickey and Kingdom Hearts series. Unfortunately, there has been no word on whether or not Disney Interactive's output reduction will bear any effect on the development of Kingdom Hearts 3. The next entry in the Star Wars: Battlefront is currently being handled by Electronic Arts and DICE.

Disney Interactive has suffered over $1 billion in losses over the past few years. Fortunately, Disney Interactive's video game/toy line combination series, Disney Infinity, has been selling extremely well compared to the studio's other gaming ventures. Disney Interactive also has a mobile game, named Tsumu Tsumu that has been downloaded over eight million times since its release two months ago and is currently topping download charts in Japan.

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