Disney Sees Revenue Growth Flatten in Its Online Units

Growth of advertising and sponsorship revenue at Walt Disney Co.’s Internet operations flattened out in midyear as the units struggled with management problems and apparent conflicts between the giant media company and its Net-savvy joint venture partners, Disney said in a government filing.

The report to the Securities and Exchange Commission covered the joint operations of Disney’s Go.com Internet portal, search engine Infoseek and numerous other units--all of which have since been combined into Go.com, spun off as the components of a tracking stock and given unified management.

“Up until three weeks ago, this business was managed by two separate management teams with somewhat diverging objectives,” Go.com President Steve Wadsworth told an investment conference sponsored by PaineWebber on Wednesday.

The management hurdles also led to problems at ESPN.com and ABCNews.com, which were also operated as joint ventures with Infoseek, he said. Wadsworth’s presentation was included in the government filing.

In all, the Go units recorded ad and sponsorship revenue of $162 million in its fiscal year ended Sept. 30, up from $108 million a year earlier. E-commerce revenue grew to $38 million from $23 million a year ago. The figures were reported on a pro forma basis as though Go.com had been operating for the entire two-year period rather than merely for the last month.

Burbank-based Disney last month issued a stock to track Go.com’s performance. It has fallen 29% since. Go.com slid 88 cents Friday to close at $25 and Disney fell 41 cents to $28.04 on the New York Stock Exchange.