Walt Disney Company has redesigned its primary web site Disney.com for the third time in five years. The media conglomerate is desperate to turn around its gaming, mobile and Internet division after 15 consecutive quarters of losses, adding up to nearly $1 billion.
Disney CEO Robert Iger is optimistic about new products, which include an ambitious and unannounced gaming initiative code-named Toy Box. It’s been a huge concern to investors that the company has not been able to figure this out.
“We’ve been waiting for years and years and years,” said Jessica Reif Cohen, a senior analyst at Bank of America Merrill Lynch. “For traditional media companies, this really does seem like a totally different skill set.”
While Disney used the Disney Channel as its introduction to many young people, they know that Disney.com is important to the next generation of consumers. Major companies like Time Warner with AOL, News Corp. with MySpace and Viacom with Harmonix have had a hard time with new media, and Disney in 2001 took $878 million in charges to close its Go.com portal.
Among recent failings of the company were Epic Mickey, which went through six years of development and came out on the Wii when that system’s fortunes were starting to fade. Disney also had six AAA development studios at one time poised for console development, but weren’t readily ready when attention shifted to mobile and social games, having to buy out Playdom for $563 million in 2010.
Leading Disney Interactive’s latest quest for profitability are James Pitaro, a former Yahoo executive, and John Pleasants, Playroom’s former CEO. They quickly cut costs through a series of layoffs and have shut down three of Disney’s console game studios.
“We can’t expect to grow Disney.com in reach and engagement if we’re just focused on marketing,” Pitaro said.
One major change is reaching out to external websites, enhancing the company’s presence on YouTube, spending up to $15 million to make original Web series. One of them, based on Outfit7’s Talking Friends apps, has generated over 102 million views in only a few months and Disney now operates more than 60 YouTube channels.
“We have to take our content to our guests wherever they are,” said Pitaro.
One of their best new prospects is Swampy, an alligator who stars in Disney’s mobile game Where’s My Water? The game has over 100 million downloads, has spawned a toy line and been added to Typhoon Lagoon, a Walt Disney World water park, with a Swampy short series planned for the Disney Channel.
A lot of emphasis is being made for Toy Box, a console game with extensive mobile and online applications in which various Pixar and Disney characters will interact with each another. “I’m excited about what we’ve already done and where we’re going,” said Pleasants, adding that Disney has had three No. 1 apps in the last six months.
Pleasants, whose contract expires in 2014, said “it would be an honor to be asked to stay. We have a long way to go, but we have a plan and just need to execute it.”
Source: New York Times