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Disney Interactive Segment Shifts Gaming Strategy As Revenues Decline

After Disney's gaming segment saw falling revenue in its first fiscal quarter, the company will be focusing most of its brands more on Wii and DS -- while eyeing next-gen projects for its Marvel brands.
The Walt Disney Company's Interactive Media segment, which houses its game business, saw revenues fall in its first fiscal quarter -- but narrowed its losses. Disney Online and Disney Interactive Studios combined for $221 million in sales, down 29 percent year over year, alongside $10 million in losses as compared to $45 million in losses in the same period last year. The company's fiscal quarter ended January 2, 2010. Disney says it saw fewer self-published releases, thus lower unit sales -- but more subscription revenue from its Club Penguin kids' online game. Company CEO Bob Iger says Disney will be evolving its gaming strategy to focus more specifically on the Wii and DS, where its brands tend to perform better and development costs are lower than on next-gen consoles. Iger stressed that Disney won't abandon all AAA game development, however, planning a film tie-in to the upcoming Tron: Legacy, among other projects. Notably, Disney's now the parent of Marvel after its $4 billion acquisition late last summer, and feels that those brands in particular would do well among the Xbox 360 and PlayStation 3 audience. Including all of its businesses, Disney posted Q1 revenues of $9.7 billion, up slightly from $9.6 billion a year ago. Profit edged down to $844 million from $845 million a year prior.

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