Disney to increase play for video-game market

Walt Disney Co. will triple the amount of money it spends developing video games to benefit from strong growth prospects in the global market, the entertainment company’s chief financial officer said Friday.

“We are ramping up our investment in video games.... It is a market where there is real opportunity,” Thomas O. Staggs said in London.

Part of the Burbank-based entertainment company’s strategy centers on making sure that hit products sell strongly across the business, irrespective of whether they start as a film, product or game.

Disney spent about $100 million on video game development last year and will spend $130 million this year.

“Over the next five years or so we are ramping up to about a pace of $350 million per year in video game investment, principally consoles and hand-helds,” Staggs said.

Market researcher Screen Digest forecasts that the particularly cyclical global gaming software market will be worth $21.3 billion in 2009, compared with $20.2 billion last year.

A particularly fast-growing area is so-called massively multiple player online gaming, which is expected to see subscription revenue jump from $875 million last year to $1.4 billion in 2009.

“The potential to make profits in that space if you have a hit game is significant,” said Screen Digest gaming analyst Piers Harding-Rolls.

Staggs said Disney created a “Pirates of the Caribbean” game to coincide with the release of the latest film, which became a hit across gaming platforms in Britain, France and Germany.

This year, Disney plans to launch a multi-player online “Pirates” game in the U.S., then in Britain.

“We are early on in the process of developing a video-gaming capability,” Staggs said.

Three months ago, Disney launched “Spectrobes,” a role-playing game for Nintendo’s hand-held DS player produced by Disney’s Interactive Studios arm that has shipped about 700,000 units, Staggs said. The game was developed for Disney by Japan-based Jupiter Corp.