By mid-December, software publishers will have one less competitor to worry about. Viacom New Media is closing its doors.

Citing good economic sense as the reason, parent company Viacom Inc. is rolling Viacom New Media into its other interactive entertainment publishing arm, Virgin Interactive Entertainment.

‘The purpose behind that is really that we’ve got two units functioning in the same business, and this is just a way to reduce costs,’ says Nancy Bushkin, Viacom Inc.’s director of corporate relations. ‘We believe [the move] will achieve profitability sooner.’

With the exception of a handful of titles planned to launch under the Viacom New Media label in 1997, upcoming releases will appear only under the Virgin name.

Virgin’s nine-year track record, compared to Viacom New Media’s four years in business, gave it an advantage. ‘Virgin is a more mature operation,’ says Bushkin. Also in its favor, Virgin’s corporate office in Irvine, California, houses on-site development facilities.

Viacom New Media’s development center in Chicago will remain open, but its New York headquarters, with about 70 employees, will shut. Viacom Inc. is hoping to find other positions for the staff.

Viacom Inc. had been considering the consolidation of the two interactive publishers since this past spring when it announced that it would retain ownership of Spelling Entertainment, which includes Virgin Interactive Entertainment. Viacom acquired Virgin in September 1994 as part of its merger with Blockbuster Entertainment Corporation.

With the launch of its last titles by the second quarter of 1997, Viacom New Media expects to have published 51 titles since its creation in 1992.