Walt Disney expects a big Internet year in 2007

The Walt Disney Co.’s push into digital content and online games should help the company generate Internet revenue of more than $700 million in 2007.

Speaking to Wall St. analysts on Disney’s year-end earnings call, president and CEO Robert Iger also said the company’s recent content deals with Apple’s iTunes store has resulted in more than 500 million downloads since September. “This underlines the strength and uniqueness of our film library and indicates that there is a consumer appetite for movie downloads that complements demand for DVDs,” he told analysts.

With the increase in digital content, the company is also overhauling Disney.com and making the site more interactive. “We will take another big step forward early next year by launching an all-new Disney.com," Iger says. “Parents will be able to do everything from arrange a family getaway at one of our parks or on one of our cruise ships to purchasing Disney products. For kids, it will be the ultimate in customizable web networks, where they can watch their favorite Disney shows, play new interactive online games, chat with their friends, and swap music playlists.”

Disney, No. 55 in the Internet Retailer Top 500 Guide to Retail Web Sites, is also making a significant investment in the digital games market. “We are increasing our investment in video games, with roughly 30% more in development spending expected in fiscal 2007 than in 2006,” Iger says. “Video games represent an important long-term growth opportunity for us and looking ahead we are targeting an increase in our annual video game development investment to roughly $350 million over the next five to seven years.”