The Wall Street Journal is reporting that Disney plans to lay off hundreds of employs from its interactive entertainment unit as early as next week.
The cuts will be aimed primarily at Playdom, the company that Disney purchased for $563 million in 2010. The company specializes in mobile and social games including Where’s My Water? and its spinoffs, as well as Marvel’s Avengers Alliance. The developer has struggled since the purchase, while Disney has found success elsewhere with Disney Infinity.
Disney Interactive employs about 3,000 and has consistently struggled to turn a profit. Disney plans to continue with cutbacks and shifting focus to low risk core properties in order to get the unit into a state of consistent profitability.
The cuts come after the merging of the games and media groups under the sole control of Disney Interactive President Jimmy Pitaro.