Disney to close GO.com, take charge

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The Walt Disney Co., in a major overhaul of its online strategy, announced Jan. 29 that it will close its Internet portal GO.com, cutting about 400 jobs and taking a charge in the second-quarter. The company will also dissolve its online tracking stock, Disney Internet Group, converting its shares into common stock on the parent company as of March 20. <

"The Internet continues to be a central focus of our company's business strategy," said Michael D. Eisner, chairman-CEO, in a statement. "We believe this action should help us gain greater competitive advantage as we leverage Disney's creative content, brands and other assets." Disney said it will take a charge of $790 million related to the write-off of intangible assets and a further $25 million to $50 million in charges on severance and the write-off of fixed assets because of the restructuring.

Disney's remaining Internet operations will be folded into the parent company, and the company will continue its other major Web sites, such as ESPN.com, Disney.com and ABC.com. The Internet Group has lost money every quarter since it debuted in January 1999. In September 2000, the company introduced a new site and strategy, turning GO.com's focus to leisure and entertainment instead of general news.

Copyright January 2001, Crain Communications Inc.

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