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Report: Disney lays off half its game staff

The purported layoffs come as the company transitions from console content to casual games with the help of recently acquired Playdom, according to CNBC.

Epic Mickey's logo.
Epic Mickey's logo. Disney Interactive Media Group

Walt Disney has laid off hundreds of people in its game development division as it transitions from console content to more casual gaming, according to CNBC.

Citing an unnamed source, CNBC reported that Disney may have eliminated up to 350 of the 700 jobs in the company's game development office.

However, a source close to Disney told CNET today that the layoffs are not nearly as steep as CNBC is reporting.

The news is all the more surprising when one considers that Disney launched the popular Epic Mickey on the Nintendo Wii less than two months ago. The release had prompted some to wonder whether the company would actually start focusing more of its efforts on console games.

Epic Mickey allows players to take control of the famous mouse and use paint or paint thinner to change the in-game world. Making Mickey Mouse a staple in the gaming market is something that Disney had dreamed about for years. Back in 2009, Epic Mickey creator Warren Spector told CNET that Disney had been looking for "someone to bring Mickey to a gaming audience in a whole new way and make him a hero for the 21st century." He specifically cited top gaming characters that Disney believed, Mickey Mouse should be compared to.

"There are these characters, like Mario and Link (from the Zelda games) and Sonic, and I don't know if it's true, but you've got to believe that those characters--who are three heads tall and cute and iconic--at some level were inspired by Mickey Mouse," Spector told CNET. "So why shouldn't Mickey be at the top of the gaming heap?"

But behind the scenes, it seems that Disney wasn't as focused on targeting the traditional gaming market as Spector maintained.

Last summer, Disney acquired social-gaming company Playdom. It didn't take long for Playdom CEO John Pleasants to take a leadership role at Disney. In October, the executive became co-president of Disney Interactive Media Group, alongside former Yahoo executive James Pitaro. They replaced Steve Wadsworth, who stepped down in September as head of the group, which handles all facets of the company's game exploits.

For its part, Disney hasn't commented on how many people were laid off. The company said in an e-mailed statement to CNET today that "as part of setting a strategic direction for future success in the digital media space, the Disney Interactive Media Group yesterday began a restructuring process."

Updated at 12:04 p.m. PT to include Disney's statement and at 12:50 p.m. PT to include information from anonymous source.