Why Disney shut down Metaverse unit

Disney is cutting costs, and it’s starting with its Metaverse unit. The company is looking to reduce costs across all its divisions, and the first item on the chopping block is the cross-divisional Next Generation Storytelling and Consumer Experiences group. This team includes Disney’s metaverse ambitions.

The layoff affects 50 employees. Mike White, a long-time Disney employee and senior vice president of the metaverse division, led the decision to eliminate the Next Generation Storytelling and Consumer Experiences group, with Disney declining to comment.

Mark Bozon, who previously worked for Apple as a gaming executive, was a senior creative leader for the Next Generation Storytelling and Consumer Experiences team.

Disney making cuts

The cut was announced Monday, with more layoffs to be expected — Disney reportedly plans to lay off 7000 jobs with Bob Igor, interim CEO, striving to reduce $5.5 billion in operating costs.

The company memo released by Igor Monday warned employees to anticipate an even bigger round of cuts “before the beginning of summer.”

New initiatives flop

When Bob Chapek was Disney CEO in early 2022, he assigned the responsibility of the corporation’s metaverse unit to White, appointing him to a brand new position as overseer of the division.

Chapek sent out a company-wide memo that White, with more than 10 years of experience at Disney, was responsible for pursuing the company’s initiatives to combine “physical and digital worlds.”

The board of directors at Disney unceremoniously fired Chapek in November 2022, to be replaced with its former CEO Iger. Since then, the company has focused on a new cross-divisional membership program with the goal of offering perks and exclusive offers to people that will include a subscription to Disney+, discounts on its merchandise, as well as access to their theme parks and cruises.

Like the different divisions getting the axe at Disney, this initiative has also been scrapped.