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Disney has just announced that they will be ceasing production of Disney Infinity. This also results in them shutting down their in-house studio, Avalanche, which has developed the game since the beginning. This is late breaking news and was first announced on Disney’s investor call.

Jimmy Pitaro, chairman, Disney Consumer Products and Interactive Media, has just put out this statement:

“After a thorough evaluation, we have modified our approach to console gaming and will transition exclusively to a licensing model. This shift in strategy means we will cease production of Disney Infinity, where the lack of growth in the toys-to-life market, coupled with high development costs, has created a challenging business model.  This means that we will be shutting down Avalanche, our internal studio that developed the game.  This was a difficult decision that we did not take lightly given the quality of Disney Infinity and its many passionate fans.”

It seems that market for toys-to-life has slowed and development costs have risen since the first version of the game. They still have two expansion packs being launched for Infinity, and these are slated to be released as the last updates to the game.

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