The Walt Disney Co. is shutting down San Francisco-based video game production company LucasArts and laying off staff as it focuses on the less risky, less expensive path of licensing its characters and stories to other developers.
The closure comes four months after filmmaker George Lucas, best known as the creator of the “Star Wars” franchise, sold Lucasfilm Ltd. to Disney. LucasArts is part of the Lucasfilm portfolio.
A Disney spokesman confirmed the layoffs Wednesday, but neither he nor Lucasfilm would comment on how many people were affected. The website Kotaku, which covers the gaming industry, said 150 people were laid off, citing an unnamed source. Miles Perkins, a Lucasfilm spokesman, told Bloomberg News that Lucasfilm employs more than 1,800 people in San Francisco and other locations.
A “small team” will remain to handle licensing partnerships, but all in-house development has been halted — including the much-anticipated “Star Wars 1313,” Perkins said.
Disney, which last year announced it was buying Lucasfilm for $4.05 billion and has its own interactive games division, is several months into an internal cost-cutting review. The decision to shutter LucasArts comes as the developer and publisher, once known for humor-tinged adventure games such as “Secret of Monkey Island,” has struggled in recent years to produce a hit in an industry increasingly dominated by action-oriented games.
Disney has been moving away from games that are expensive to make for consoles such as the Xbox 360 and PlayStation 3 and toward apps. One example of the licensing model is Rovio Entertainment Ltd.’s November launch of “Angry Birds Star Wars.”
LucasArts was founded in 1982 by Lucas and has employees in San Francisco and Singapore, according to its website. The Lucasfilm division was one of several to move to the eastern side of the Presidio in 2005.