The Walt Disney Company confirmed Wednesday they will layoff as many as 150 workers at Walt Disney Studios.
Last week, Disney effectively shut down LucasArts, the video game subsidiary of Lucasfilm, which Disney acquired last year — along with the future of the "Star Wars" franchise — from George Lucas in a $4-billion-plus cash-and-stock deal. The company also acquired Pixar in 2006 and Marvel in 2009.
The movie studio layoffs represent a very small percentage of Disney's overall workforce of 150,000 employees. But they point to what Morningstar analyst Michael Corty called the need for Disney to remain competitive.
"The movie business is a lot different than it was five years ago. In general, the studios are looking for ways to cut costs across the board," Corty said. "The bottom line is they're not selling DVDs like they used to. They're working their way toward more digital sales, but that's something in transition."
Corty said Disney needs to make moves to remain competitive.
"And unfortunately that sometimes involves laying people off, " he said.
Walt Disney Studios has generally underperformed the company's broadcast and parks divisions. The movie "John Carter" bombed at the box office, although the record-setting success of "The Avengers" helped. But analyst Corty said movies are no longer the star of the show for the Mighty Mouse.
"The film unit is still a solid business and there are ways they can improve it," he said. "But parks and broadcast are better in today's marketplace. They have advantages."