The Walt Disney Company has announced its acquisition of the adorable virtual world/social networking portal favorite, Club Penguin for $350 million. The company has created an incentive of $350 million in addition to the initial buy through 2009 depending on the growth of Club Penguin’s revenue.
The club will be renamed Disney’s Club Penguin, but keep the same URL name and expand internationally. The game is predominantly targeted towards children ages 6-14, and Disney plans to promote the site on Disney.com, the Disney Channel and Radio Disney.
Prices were set under the consideration of the potential growth of the site’s subscribers both domestically and internationally. Disney CEO Bob Iger said, “Our vision has been to create online destination where kids around the world can interact with each other and play games alongside their favorite Disney characters.”
Club Penguin earns its revenue through paid subscriptions as the site did not originally have advertisements on it. Whether this aspect of the site will stay the same, remains to be seen. 12 million active members have access to the site in a limited version, while 700,000 paid members have access to the full world.
The original reason for the lack of advertising was the safety precautions of a free game site and that they were tired of marketing that is aimed at young kids. Only time will tell how long the penguin can remain king of the jungle.