Disney merging videogames group with online group

PaidContent and AllThingsD reported last night, and I have just confirmed, that Disney is merging its fast growing videogame unit with its fast growing online content unit into one super-charged digital division.

So Disney Interactive Studios, which has published everything from "Hannah Montana" and "High School Musical" games to "The Chronicles of Narnia" and "Turok," will now be part of the same group that runs Disney.com, "Pirates of the Caribbean Online," and hundreds of online casual games. The new umbrella division is called Disney Interactive Media Group.

The merger makes a lot of sense on multiple levels. Operationally, these two units are increasingly stepping on each other's toes. Why did one division make last summer's "Pirates" console games and an entirely different one produce "Pirates Online." Is there really that big a difference between the casual games DIG makes for its websites and DIS makes for the DS? (And can I have more abbreviations starting with "D" in one sentence?)

I'd also bet this will be useful for Disney on Wall Street, as it can now report all its digital revenues as one big line item, rather than having videogames buried as part of consumer products. That should help the Mouse House (as Variety calls it) to promote itself as a 21st century digital powerhouse.

Steve Wadsworth, president of Disney Internet Group, came out as the corporate victor, taking the role as head of Disney Interactive Media Group. Graham Hopper, the senior VP in charge of Disney Interactive Studios, will now report to Wadsworth in some capacity, though it's not exactly clear yet what his title will be. Unless he's really unhappy with the arrangement, it seems safe to assume Hopper will stay in charge of non-online videogames, since he has spearheaded a major expansion of the division, including buying and starting multiple development studios (Warren Spector's Junction Point, Black Rock, Propaganda, etc.) and adding new mature and original IP to the line up ("Turok," "Pure," "Ultimate Band," whatever Spector is doing).

Disney Internet Group, meanwhile, has been investing heavily in virtual worlds including upcoming ones based on "Fairies" and "Cars," as well as overseeing "Club Penguin," which it bought last year. In addition, it handles mobile content and games.

You can read the official memo from Bob Iger about the topic, which was apparently leaked by someone last night, on PaidContent.

More coming in my story for tomorrow's Daily Variety.