Disney Pulls Plug on Video Arcade

This article comes from Highwaygames.com

Citing low attendance, The Walt Disney Company said Friday that it will close its DisneyQuest video arcade in Chicago on Sept. 4, ending an experiment in virtual reality games designed by its Burbank-based Imagineering unit.

About 270 jobs will be lost, 70 percent of them part-time positions, when the arcade in Chicago's Magnificent Mile is shuttered for not living up to financial expectations.

"It was very busy on weekends and holidays but during Monday to Friday, when kids were in school, we didn't have much traffic," said Leslie Ferraro, spokeswoman for Disney Regional Entertainment. The original and only other DisneyQuest will remain open in Orlando, Fla., where it attracts more business from visitors already bound for the Walt Disney World Resort, she said.

Opened in 1999, the Chicago location tested the arcade in a stand-alone urban location.

"Although the concept has been a creative success and exceptionally well received by our guests," the company did not get the expected return on investment in cutting-edge technology, said Randall Baumberger, senior vice president of Disney Regional Entertainment.

Similar reasons were cited when Disney closed its five prototype Club Disney "mini-Disneylands" in November 1999, including one at The Promenade at Westlake shopping center in Thousand Oaks. While the amusement and shopping parks did not lose money, it was believed they would not meet profitability goals if the chain were expanded.

The company had also hoped to develop a chain of DisneyQuests, but abandoned those plans in June 2000. The closure is the latest cost-saving measure by the Burbank-based media giant, which is in the process of cutting 4,000 jobs companywide.

Seventy Disney stores have been closed. And, to boost attendance, the new California Adventure theme park in Anaheim recently cut its adult admission by $10, to $33, with a free child admission.

"I think Disney's been on a very cost-conscious adventure of late and therefore any of the underdeveloped businesses and franchises could be vulnerable," said Jeffrey B. Logsdon, entertainment analyst with Los Angeles investment bank Gerard Klauer Mattison & Co.

Disney's stock lost 48 cents to close at $27.71 on Friday. DisneyQuest Chicago cut its adult admission from $34 to $26 last fall and offered a limited-use $10 admission for those with about an hour to spend. The company did not reveal attendance figures or how much the venture cost.

The five-story complex featured a Virtual Jungle Cruise and CyberSpace Mountain, where people designed their own roller coaster in a computer and then rode it in the same 360-degree flight simulators used by the National Aeronautics and Space Administration to train astronauts, the company said.

Last year Disney also added a virtual reality version of its famous Pirates of the Caribbean ride, in which patrons act as captain and cannoneers to blast away at other ships in a quest for treasure. ESPN Zone, another Disney attraction in that part of Chicago, will remain.

SOURCE: Daily News Los Angeles.