Goodbye Tinkerbell.

AUG. 23, 2013 • Soon after this week’s introduction of Disney Infinity that marries an online game with a companion line of physical synchronized toys, Disney Interactive announced it was shutting down three of its core MMOs. Closing down in September will be Toontown Online, the $9.95 monthly subscription title launched in 2003; as well as two free-to-play titles: Pirates of the Caribbean Online that released in 2007, and Pixie Hollow that arrived a year later. Existing players of all three games will get unrestricted access to all content until September 19, and subscription refunds will be assessed and remitted at a later date. Disney Interactive lost $216 million last year, and intends to redirect resources into a bigger push into mobile content, as well as its Club Penguin virtual world game that was acquired in 2007 for $350 million. Club Penguin will be Disney Interactive’s only active MMO.

Impact: Live by the IP, die by the IP. We remember how much enthusiasm there was at Disney Interactive prior to the release of both Pirates of the Caribbean Online and Pixie Hollow. The free-to-play model was still relatively untested in Western markets, and there were high expectations that both franchises would serve as the foundation of a succession of studio-based online games. Regardless of Disney’s efforts to frame these MMOs as family entertainment, they were products appealing directly to young age groups. As children grow up, their tastes change and they move onto new games and activities. Despite five Disney Fairies films released since 2008, we suspect it has been difficult to maintain growth goals for the Pixie Hollow game as the number of new kids arriving have not kept up with those transitioning out. In Pirates of the Caribbean’s case, it has been two years since a new film, and another installment is not expected until 2015. Without a regular release to help bring new players into the game, it can also be difficult to grow an IP-based MMO despite Pirates of the Caribbean Online’s broader age demographics. However, it is interesting that these products lasted longer than World of Cars Online which closed in 2012 after less than two years.  We actually were surprised that Disney Interactive kept these products going for so long after deciding to close World of Cars Online.

Moving beyond the realities of IP-based MMOs, there is also the flood of F2P MMOs that have entered the market during the last five years. With so much competition out there it is difficult even for a huge brand like Disney to dominate, especially with a subscription MMO like Toontown Online. We can see why Disney Interactive would place its bets behind the sandbox adventure Disney Infinity, as well as Club Penguin, which still draws a substantial player base globally. The division has been searching a long time for a digital niche it can succeed at in a big way, and desperately needs to secure one. Disney Infinity has a good shot, but so much mobile game content is being released that there too Disney will find a difficult field to win.