Disney's Game Foray Could Dwarf Competition

That relationship is unlikely to be jeopardized for a while, assures Hopper. "Sports games are a specialized business where EA has significant expertise and is clearly the leader," he says. "Our focus will be on pieces not licensed out."

EA might not have to worry yet, but some of the other publishers who focus on developing content beyond hard-core gamers, such as family-friendly content, could be in trouble. "Disney's strength has been children's content," says Billy Pidgeon, a games analyst with researcher IDC.

Thus, says Pidgeon, a company such as THQ that depends on Disney content will be most affected by the entertainment giant's new focus.

THQ rode the coattails of the animated movie Cars -- the No. 2 overall console title ranking in the U.S. for calendar 2006 -- to a third-quarter sales rise of 33% to $475.7 million, from $357.8 million a year ago.

Hopper says most of the current licensing relationships with publishers will continue. "We are not a threat to other publishers," he says. "This is a growth industry, and we are still talking to just 15% or 20% of the population."

In fiscal 2006, nearly half of Disney Interactive revenue was from self-published products, while the rest came from licensing Disney IP to other publishers.

The EA/ESPN agreement is not included in the division's revenue, but its licensing agreements with other publishers such as THQ and Square Enix are.

Video-game publishers might be OK for now, but some may eventually find themselves banished from the Magic Kingdom.