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January 26, 2011 by · Leave a Comment 

Despite their enormous financial and content resources, movie studios have traditionally encountered rough seas in launching video games, often beaten by small, upstart companies. The Walt Disney Co. — which seemingly ought to be able to convert its popular animated titles to appealing games — has annually lost hundreds of millions of dollars on the ones that it has turned out, including recent games based on the hit movies Tangled and Tron: Legacy. This week, with the company reporting a net loss of $787 million over the last three years, Disney announced that it will restructure its video game division, laying off about 200 employees in the process. The Los Angeles Times reported today (Wednesday) that the cuts are only the beginning of what is likely to be numerous reductions as the company attempts to make its digital division profitable. “Disney has been consistently frustrated in trying to build its market share” in console games, John G. Taylor of Portland, OR-based Arcadia Investment Corp. told the Times. “One of the surprises of the last three or four years was how unproductive most of their movie-related titles were.”