Walt Disney Internet Group extended its reach into the untapped Chinese Internet arena today through an alliance with SeaRainbow Holding Corporation, a partner with China Telecom, which operates as the top Internet service provider in China and controls 82 percent of the country's bandwidth connections.

Disney.com and Disney's Blast content will be localized into Mandarin Chinese and launched at www.disney.com.cn. The new Disney site will be linked to SeaRainbow's 17 Chinese language web sites, including popular game destinations ourgame.com and asiagame.com.

Having met with great success in the international market, Disney's Blast, a subscription service based on games and activities that incorporate Disney characters Mickey Mouse and Winnie the Pooh, is licensed in 16 countries, including France, Mexico, Brazil, Spain, and the Netherlands.

"We are pleased to have Disney's quality, family-friendly entertainment for China," said SeaRainbow Holding President Jian Kang. "We believe this cooperation establishes an exciting new business model for the Internet in China. We view this as a win for SeaRainbow, Disney and the Internet users of China who will benefit from this new relationship, and we hope this serves as an example of positive international Internet cooperation."

Meanwhile, executives at Walt Disney Co. have been battening down the hatches in time for the widely anticipated economic slump. The company reportedly told shareholders earlier this week that it is well prepared to weather a possible recession, despite concerns about declining advertising revenues and waning theme park attendance.

According to the Associated Press, Disney officials said that a market-wide drop in share prices combined with an abundance of free cash and a lack of debt at Disney could lead to a major acquisition in the next few years.

Earlier this year, Disney consolidated its Internet ventures when it closed popular Internet portal Go.com. Go.com was created in connection with Disney's acquisition of Infoseek.

Walt Disney Internet Group has also been affected by industry-wide layoffs and consolidation. In February, the company announced the elimination of 135 staff positions as part of a strategy to streamline business operations and reach profitability sooner than originally planned.

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The cuts occurred primarily in the company's technology group and ABCNews.com.

A company spokeswoman for Walt Disney Internet Group said the move was toward developing a leaner and more efficient organization, and that the company continues to maintain a strong focus on its core Internet assets.

North Hollywood, California-based Walt Disney Internet Group manages a slew of successful web sites, including Disney.com, ESPN.com, ABC.com, and ABCNEWS.com. Additional properties include Family.com, Mr.Showbiz, Movies.com, Wall of Sound, DisneyAuctions.com, DisneyStore.com, DisneyVacations.com, Soccernet.com, and NFL.com.

At press time, Disney Internet Group stock traded at $5.79, from a 52-week high of $25.93.