Disney Partners with Epic Games in \$1.5 Billion Deal

Disney has invested a substantial $1.5 billion in Epic Games, the creators of Fortnite and Unreal Engine. The investment, Disney’s largest ever in the video game sector, is part of a wider agreement between the two companies to construct a new Disney gaming universe. The project is expected to take several years to complete.

An Expansive Gaming Experience

The planned universe will be expansive, aiming to extend the reach of Disney’s cherished narratives and experiences. It will provide consumers with a space where they can play, watch, create, and shop for both digital and physical goods. The initiative signifies Disney’s most significant venture into the world of video games, offering numerous opportunities for growth and expansion.

The Metaverse Strategy

The term ‘metaverse’ might not be explicitly used by the companies, but the description of the project aligns with the concept: an open and interoperable ecosystem of games and entertainment. In 2023, Disney closed its metaverse sector and dismissed 50 employees, leading some to believe that the company was moving away from the metaverse. However, this new investment with Epic Games suggests a renewed commitment to the concept.

Catering to Younger Audiences

Bob Iger, CEO of Disney, highlighted the appeal of the project to younger consumers who are significant players of video games. The Disney-Epic universe is seen as an opportunity to engage more consumers and allow more audiences to form connections with Disney’s iconic brands and franchises, such as Marvel and Star Wars.

A Brand New Project

The venture is not an evolution of prior partnerships but a brand-new project. The collaboration is set to integrate Disney’s world-class storytelling into Epic’s cultural phenomenon Fortnite. However, the partnership is not about merging Disney and Fortnite into a single game. Instead, the aim is to create a Disney universe that can connect with Fortnite.

The deal is subject to standard closing conditions, including regulatory approvals.

Looking Forward

Tim Sweeney, CEO of Epic Games, and a significant supporter of the metaverse, will remain the controlling shareholder at Epic Games. The collaboration, he believes, will bring together Disney’s beloved brands and franchises with the hugely popular Fortnite in a transformational new games and entertainment universe.

The project is expected to provide a multitude of opportunities for consumers to play, watch, shop, and engage with content, characters, and stories from Disney, Pixar, Marvel, Star Wars, Avatar, and more. The companies are optimistic about fans experiencing their favorite Disney stories and worlds in innovative new ways.