EA Feels The 310 Million Dollar Dagger

Halloween is a scary time of year, no less when you’re posting a $310 million net loss. EA CEO John Riccitiello sees “weakness” at retail in October and we’re betting this isn’t the end of the road of sorrow for game publishers around the globe.

Electronic Arts isn’t unfamiliar with bad times and we’re sure to see them make constant adjustments to their headcount, game releases and press as the economy goes into a bit of a slump. Although the game industry won’t see as big a hit as the financial market, everyone is going to watch their spending during slower economic times.

That slowness is a red flag for the mega-publisher, which says it’s “proactively making cost adjustments now.” One of those adjustments is the axing of some 600 EA employees across the globe. (Kotaku)

Last year Electronic Arts lost a “small” $195 million during the same time, not exactly a gold star on the financial records but it sure looks better than this loss. A few games may crumble under the economic pressures, Tiberium for example, but let us not forget the good times! EA posted some nice figures for Spore, Madden NFL 09, Warhammer: Age of Reckoning and Mercenaries 2: World in Flames.

So, they mixed a few sequels with a few new franchise hits and gave gamers some pretty hot titles for the year. Of course, hot titles in our hand do not always translate to positive revenue in theirs.

0 thoughts on “EA Feels The 310 Million Dollar Dagger”

Leave a Reply

Your email address will not be published. Required fields are marked *

Related Post

Battle of the Mega Powers: EA Wants Take-TwoBattle of the Mega Powers: EA Wants Take-Two

We’re already looking at the results of an Activision Vivendi union and now Electronic Arts is slowly working towards taking over Take-Two. Activision Blizzard is larger than that of EA but would the Take-Two buy-out grow EA into the number one publisher once again?

For gamers, it’s changing the map of the industry. We grew up with many of these seemingly big companies but their all clamoring together to make the next big mega-power. While they struggle for ultimate domination we, the gamers, are going to either benefit from the competition or become victims, or perhaps a little of both.

Let’s assume EA and Take-Two form one entity, similar to the the Destructicons forming “Devastator,” they can reign hell upon the earth and anyone under their mighty fist shall perish! That might be a bit of an exaggeration but it’s safe to assume they’ll wield mighty power, more than ever before and their epic foe will be Activision Blizzard and, perhaps, Ubisoft. In a battle for sales and consumer acceptance the companies will be willing to out do each other at every step with huge funds at their disposal.

As a consumer, competition is a great way to produce innovation, technological advancements and excitement in the industry. These giant development houses are only this large because we’ve given them our hard earned money in return for entertaining video game titles. World of Warcraft is a major player in sucking money from our wallets in a consistent, addictive, manner while Guitar Hero explores new possibilities in music and rhythm gaming and controller accessories.

(more…)

Final Fantasy XIII – Xbox 360Final Fantasy XIII – Xbox 360

Yoichi Wada of Square Enix has let the cat out of the bag. The cat is Final Fantasy XIII for the Xbox 360 and it will be simultaneously released with the PlayStation 3 version. This may be an end to an exclusive era for Sony as all their big brands jump to non-exclusion.

This is probably a result of gamers slow adoption of the PlayStation 3 hardware for various issues, one being cost. Personally I think Sony’s move to say “no price cut” in our near future is a grand mistake. It is well understood that they want profitability over quantity but you’re losing your exclusives to a broader audience.

Each generation of consoles brings new industry trends and, for now, exclusive games from third party developers is too risky when you look at overall cost to produce a block buster title like Final Fantasy XIII. Consider the sales of GTA IV, although they were in the millions, imagine how low it would have been if they only released on the PS3. They’d might have actually lost money on the game.

Square Enix can see the writing on the wall, that writing says “ship on as many mediums as possible.” Gamers are split between consoles with a huge segment on Wii and Xbox 360, if you can at least ship on one of those consoles along with the PS3 you’ll do better financially.

(Thanks, Kotaku)

Episode 374: Lost in a CrowdEpisode 374: Lost in a Crowd

This week’s episode of Gaming Podcast has a special guest co-host, Andrew Yoon, formerly of Joystiq and currently in card game and video game development. The Gaming Flashback is the one that started them all: LEGO Star Wars: The Video Game.

The slow news week includes:

  • DDoS service targeting PSN and Xbox powered by home Internet routers
  • Japanese console sales continued to slide in 2014
  • Evolve’s questionable bargain: pre-purchase to avoid the unlock grind
  • Sony delays PS4 in China

The Question of the Week: “What is your favorite, if any, LEGO videogames?”