EA lays off 1.500

    Quote from Skjalg

    Games actually do quite well in a recession because people prefer to stay in buy entertainment that will last a relatively longer time. But yes, you’re right, but if everyone makes games for the lowest common denominator because it’s the only way to not haemorrhage money and get fired, it’s going to be pretty boring.

    I actually tried to make the same point when the economical crisis was hitting Europe the hardest, that surely studios like Grin would easily survive and thrive on the crisis.

    But PC games are expensive, in fact, so expensive that it's one of the first things people cut down on when they are running out of cash.

    Well one could argue that people have less money and thus buy only one Call of Duty game during the season instead of 3, but are games really that expensive? More expensive than a car? Going on holidays? What Taylor described is also called "cocooning effect" and I believe that games or the entertainment industry as a whole doesn't suffer nearly as much as other industries. I haven't heard any TV manufacturers complain for instance. With advertisement dependent business models it's a different story...

    Yes, game sales are not hurt badly during a recession. Venture capital and willing banks however are. Game production is a risky business which highly relies on those two things and is thereby hurt anyway.

    Quote from Zacker

    Yes, game sales are not hurt badly during a recession. Venture capital and willing banks however are. Game production is a risky business which highly relies on those two things and is thereby hurt anyway.

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    Quote from Algor

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    I will eat first part of my comment again Certainly looks worse than I expected and also most certainly goes against traditional economic theory. Ohh well, this just means that the games industry is fucked in possible way then.

    Quote from Zacker

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    I will eat first part of my comment again Certainly looks worse than I expected and also most certainly goes against traditional economic theory. Ohh well, this just means that the games industry is fucked in possible way then.

    Yes, Midway closed down because of the economic crisis. So did Factor 5 and Free Radical because they have all been so succesful lately. The "crisis" is also completely to blame for EA's poor performance and the layoffs don't tie in some bigger restructuring plan, they are a direct result. Excuse the sarcasm, but blaming a decline in HW and SW sales solely on the recession is about as clever as calling the games business "recession proof".

    I rather listen to Satoru Iwata explaining to me reasons for stalling Wii sales than listening to more bad excuses.

    There does become a point when all industries dry out, meaning you reach the "supply" for the demand and unless the demand constantly increases something is going to give. I'm not suggesting we've hit that point yet but the raw amount of games being developed these days is absolutely insane. It's going to take another generation at least before we see allot more demand for main stream games IMO. The same happened for Cinemar, at one point it was booming then in the last 5 years it's been on a slow decline for one reason or another.

    Things change and good companies adapt to surivive.

    yeah but even with nintendo's market share of people from the "less likely individual group" it only really works for family orientated games, all be it a big chunk of the market. Family films have always been successful at drawing in everyone but they are not going to be the core of the industry as a whole - just a part of it.

    One thing to keep in mind is that for the traditional console/handheld retail games market, the majority of growth in 2007 and 2008 came from Nintendo hardware sales and music category of games. Guess what happened in 2009? Market saturation + global recession. So after huge double digit growth in topline sales the last 2 years, some air is getting let out of the bubble. This is a good thing in the long run and it had to happen. Growth of gaming (and consumer spending on it) does have a limit and a pullback was bound to happen.

    A somewhat interesting comparison is to the US housing market. After wanking absurd growth from 2002 to 2007, the bubble burst. What did we expect? Real estate values to go up by 25% per year forever? [Blocked Image: https://migrationtest.mapcore.org/public/style_emoticons/default/mapcore_smilies/emot_shakehead.gif] Talking to a real estate agent in Southern California in 2007 was completely absurd. They'd say "Oh yeah, YOU HAVE TO BUY NOW because the market is going to REALLY grow in 2008...like 20 to 30%. Look where it's grown already!!!"

    ...so back to games...there is only so much revenue growth available in the plastic guitar controllers business. How many times are core guitar games fans going to buy yet another bundle? A higher % opted for the DVD only SKUs at retail, and that contributed to the chilling effect on growth we're seeing this year. And as for Nintendo HW, Wii sales sagged and a price break was long overdue, not to mention good games for both Nintendo core fans (Mario, Zelda, etc) and all the Wii Fit etc crowd. (What, you're still reading this spewage?)

    On the plus side for Nintendo right now, New Super Mario Bros is awesome. My wife LOVES it and she never plays the Wii anymore. I think that should certainly help Nintendo.

    It's always sad to see names like Maxis and Pandemic affected, but bear in mind The Sims is no longer handled by Maxis, Will Wright is gone, and the only game Maxis has put out since The Sims didn't actually go down that well (although I think its immense hype due to being "from the creator of The Sims" still led to good sales). It's probably not fair to begin to demonise EA for making cuts or closing a studio when you don't really know what kind of internal politics and issues it's facing, and if a massive studio like Maxis isn't pulling its weight then downsizing is inevitable.

    Quote from Thrik

    It's probably not fair to begin to demonise EA for making cuts or closing a studio when you don't really know what kind of internal politics and issues it's facing, and if a massive studio like Maxis isn't pulling its weight then downsizing is inevitable.

    I really couldn't care less what's "Fair" to a corporation.

    Er, what? Okay, but what I just said about Maxis not necessarily being worth keeping at its full-strength size still stands. When you're suffering massive financial losses — largely caused by supporting original IP and gamers not fucking buying the games, I might add — you're obviously going to downsize parts of the company not performing, no matter how loved they are.

    EA gave Maxis all the goodwill in the world with Spore, and it ended up being a bit shit. Creators of The Sims or not (bearing in mind that part of Maxis is now a separate studio), they're subject to the same rules that govern all businesses in the world — if they don't supply products that people demand, they lose their opportunity to do so.

    I mostly blame gamers nowadays. Every time publishers have lent massive support to original IP, they end up underselling and/or being total flops. There's a cemetery of amazing games that didn't sell well, and the 'publisher didn't market it properly' excuse only goes so far.

    gonna post this here, OT but better than another thread.

    http://www.marketrap.com/article/view_a ... ears-later

    Quote

    “with only eight months on the job as Chief Executive Officer, John Riccitello announced a buyout of Pandemic and Bioware studios from his former firm Elevation Partners, of which he was one of the founders. The purchase price looked astronomical for a developer: 840 million. To put that in perspective, Take Two (TTWO) Interactive, Inc. purchased Bioshock developer Irrational Games for 11 million and Civilization publisher Firaxis for 27 million in 2006.”

    Quote from Jetsetlemming

    I really couldn't care less what's "Fair" to a corporation.

    Yea, especialy when the name of that company is EA who have a long history and reputation for fucking over its employees and closing renowned studios. I don't believe that there is no other option then closing studios like Maxis and Pandemic. The pattern that i always saw with EA is that they destroy studios to get rid of competition. Even if it is their own studios which they paid a shitload of money for. Thats just a very sick buisness practice imo.

    Quote

    ":1ncgvado]gonna post this here, OT but better than another thread.http://www.marketrap.com/article/view_a ... ears-later

    “with only eight months on the job as Chief Executive Officer, John Riccitello announced a buyout of Pandemic and Bioware studios from his former firm Elevation Partners, of which he was one of the founders. The purchase price looked astronomical for a developer: 840 million. To put that in perspective, Take Two (TTWO) Interactive, Inc. purchased Bioshock developer Irrational Games for 11 million and Civilization publisher Firaxis for 27 million in 2006.”

    Yea the whole Pandemic story, from EA's acquisition to its closing only 2 years later, is a mess Certainly doesn't make Riccitello shine in a good light.

    The amount of money they throw out all the time is absolutely incredible. Containers full.

    I really don't get how they can even make money at all.

    Buying up a studio for 300 mil or so on on day one, then firing loads of people on day 2 because "we need money" also isn't exactly a sign of good timing...

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