Disney's Studio Division To Layoff 20% of Staff; Production Head To Leave

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Disney's Studio to Cut 20% of Staff

• Summary: As expected, Disney will cut back its studio division by 650 workers, but in a surprise move, the company announced the departure of studio production head Nina Jacobson after eight years at the post. Oren Aviv, Disney's head of marketing, will now fill the role. Disney studios is in the midst of a shift toward more general-market films, and cutting back its Touchstone-labeled movies to just 2 or so from the current 7-8. Disappointing earnings from 2005 films and the integration of Pixar Animation Studios, acquired by Disney, are behind the restructuring in the unit.
• Comment on related stocks/ETFs: The recent box office success of Disney's 'Pirates of the Carribbean' sequel came too late for these cuts to be avoided.