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The Walt Disney Co. (DIS) made another foray into the videogame business Tuesday, hiring game creator Alexander Seropian and agreeing to buy his Chicago-based firm, Wideload Games.

The move comes as media conglomerates contend with a slowdown in advertising revenue and DVD sales; they see videogames as a business with more growth potential where they can exploit some of their popular entertainment franchises.

Disney didn't disclose the terms of the deal but it came on the heels of last week's announcement the entertainment giant had agreed to pay $4 billion for Marvel Entertainment Inc. (MVL), creator of videogame-friendly comic book characters and such box office draws as Spiderman, the Incredible Hulk and the X-Men.

Shares of Disney were recently trading up 1.2% to $26.20.

Disney's dealmaking is a sign of confidence in an industry that has been rattled by the rise of digital media and a breakdown in the economics of many of its traditional business models.

Seropian's hiring demonstrates that video gaming continues to be a business where the company sees opportunity in an economic recovery.

"In the long term, we're still bullish about where this industry is going to be," said Graham Hopper, general manager of Disney Interactive Studios. "Alex is valuable to us with or without Marvel."

A rare bright spot in the media and entertainment landscape, videogame sales have dropped off as the recession has worsened. However, analysts view it as a business that can continue its growth spurt as the economy rebounds because studies show young consumers spending more time playing videogames than they do with other media.

"Clearly, the amount of time spent with videogames is significant relative to other forms of media and it fits with Disney's assets," said UBS analyst Michael Morris.

That said, Morris said Disney's Marvel acquisition likely signaled the company wasn't planning a major acquisition of a videogame publisher like Take-Two Interactive Software Inc. (TTWO) or Electronic Arts Inc. (ERTS), two struggling game companies that are widely viewed as potential acquisition targets.

The Wideload acquisition "fits its strategy of investing in small, creative firms that can build out Disney's gaming business organically," said Morris.

Wideload, which is based in Chicago and has 25 full-time workers, was founded in 2003 by Seropian, who will become vice president of creative at Disney Interactive Studios, the company's game division located in Glendale, Calif.

Seropian was a co-founder of Bungie, a game company that was acquired in 2000 by Microsoft Corp. (MSFT), where Seropian oversaw the development, production and delivery of Halo, the flagship title for the 2001 launch of Microsoft's Xbox game system.

Currently, the firm is developing a family console game scheduled for release in 2010 from Disney. The studio will focus on creating new intellectual properties that target a broad audience.

Seropian will join game designer Warren Spector, who sold his firm, Junction Point Studios, to Disney in 2007 and joined its creative ranks.

Disney Interactive Studios has produced games based on the company's popular franchises, like Hannah Montana and High School Musical, but it has yet to break into the world of hard-core gaming with a big hit. Hopper aims to change that, saying that with the hiring of Seropian the company is "trying to be a magnet in this industry for talent."

-By Nat Worden, Dow Jones Newswires; 212-416-2472; nat.worden@dowjones.com