About 700 employees, or 26% of its global staff, were laid off from Disney Interactive on Thursday. While layoffs were expected to happen, nobody expected the layoffs to be on this large of a scale.

The move came after Disney decided to combine two business, mobile gaming and social gaming. As a result of these layoffs and the changed focus, the company will "cut annual game output by as much as 50%." Last year, they released nearly two dozen titles.
"These are large-scale changes as we focus not just on getting to profitability but sustained profitability and scalability," James A. Pitaro, the president of Disney Interactive.

"We’re not exiting any businesses, and we will pursue licensing partnerships in which we retain a lot of creative input. But this is a doubling down on mobile and an effort to focus much more intently on a core set of priorities.

"At the same time we are reducing our focus in some areas, we are making strategic investments in others, and the Japan business is one."

Disney-branded mobile devices are apparently doing really well there. A game, Tsumu Tsumu, has been downloaded over 8 million times since its release on January 29.

(via NY Times)