The Walt Disney Co. has acquired Club Penguin, one of the fastest-growing online virtual worlds for kids. Since its launch in October 2005, award-winning Club Penguin has grown to more than 700,000 paid subscribers, achieving this subscriber and user growth with very limited marketing efforts, relying mostly on strong product and word-of-mouth awareness among kids. The site has more than 12 million activated users, primarily in the U.S. and Canada

One of the fastest growing online destinations for kids 6-14, the site features animated penguin avatars that inhabit a snow-covered virtual world, conversing with other users, taking part in group activities and creating and furnishing a virtual home with currency earned inside the game.

Club Penguin will be called Disney’s Club Penguin, but will retain its URL (www.clubpenguin.com) and remain based in Kelowna, British Columbia. The company’s three founders, Lane Merrifield, Dave Krysko and Lance Priebe, will join Disney and remain the senior management team of the unit. Merrifield, Club Penguin’s ceo, will become an evp of The Walt Disney Internet Group (WDIG), reporting to WDIG president Steve Wadsworth. There are no immediate changes planned to the operation or business model of Club Penguin.

“We have been actively searching for an organization that not only shares our values and concerns for children, but also has the ability and desire to help us bring Club Penguin to more children throughout the world. We’ve found that partner in Disney,” said Merrifield, one of Club Penguin’s three founders. “As a former employee of Disneyland, I’ve always had a great respect for what Walt created. When he first envisioned Disneyland, he wanted to create a safe place that he and his daughters could enjoy. In the process of creating Club Penguin, we shared that passion and often pulled from Walt’s vision in the hope of creating a unique place online that we would be comfortable letting our own children visit.”

“This acquisition is consistent with our strategy of leveraging technology to create and deliver high-quality entertainment around the world and our commitment to investing our capital to generate growth and value for our shareholders,” said Bob Iger, Disney president/ceo. “Club Penguin embodies principles that are of the utmost importance to Disney -- providing high-quality family entertainment and fostering parental trust. The founders have woven together new technologies and creativity to build an incredibly compelling, immersive entertainment experience for kids and families. Just as with our own Disney.com, kids love Club Penguin and parents trust it; and we are proud to welcome the creative team of Club Penguin into Disney. Combining the creativity and knowledge of the Club Penguin team with our existing Disney Online assets will help us further achieve our objective of establishing clear leadership in the kids and families online virtual worlds space around the globe.”

“What Lane, Dave and Lance have achieved in creating such a large community around this incredibly engaging, immersive environment in so short of a time is phenomenal,” Wadsworth said. “We welcome their unique culture, and both we and they are excited about seeing what can come from combining their innovations with Disney’s brand strength and entertainment assets, global reach, and our No. 1 position with kids and families in Disney.com. We expect to continue Club Penguin’s strong growth well into the future, especially by targeting markets outside of North America and through promotion on our Disney-branded platforms.”