This week the guys discuss the mistake that was World of Warcraft: Cataclysm in the Gaming Flashback. They also discuss all the mergers and merger rumors in the videogame industry in the past few days.
The news includes:
All this and responses to the Listener Feedback about Starfield.
Now that Activision has merged up with Blizzard all under Vivendi it’s time to consider what to do with all the additional overhead, management, internal studios and sheer amount of people working on projects within their organization. In other words, it’s time to trim the fat and get leaned out for the long haul.
This isn’t unexpected news, the only way to grow more effective as a large company is to remove some of the access baggage that can slow you down and let your competitors take control. This is a sad job which nobody takes pride in (most normal people anyway) but it could mean the difference between rising to the top and sinking like a brick.
“We are focused on improving efficiency across the combined organization and are concentrating on businesses where we have leadership positions that are aligned with Activision Publishing’s long-term corporate objectives,” Activision Publishing CEO Mike Griffith said in a statement. (gamespot)
It’s important to be aggressive as a large company, just like you would be as a startup company. There is a reason startup companies grow into powerful competitors that win, grow and eventually become (or be purcahsed by) larger companies.
As part of this move some staff will be migrated to new projects, persumably reporposed into other divisions or allowed to find new jobs somewhere else. This is called “realignment” by those in the management organization, and currently those up for realignment are:
These realignments along with other organizational changes will effect a few working game titles:
At this point we’re not sure which, if any, will continue to be developed under Activision and which will be sold off to other companies or retired. Surely, those money making titles will be sold off if Activision has no plans to finish them.
Again, it’s hard to consider this a bad decision. This is a decision of growth over having too many “Cooks in the kitchen” making soup. It’s better to have rock solid titles of epic proportions than a large pool of mediocre titles with minimal sales and bad reputations, and that’s why they spend a lot of time in the office working on this and having a type of office chair for long hours on a computer is really helpful in this area.
It’s not that the titles they’re questioning are necessarily bad, but are not the leading titles in their space and are should be either given a stronger team to work on them or retire them entirely. To build a stronger team with passion and direction it might be best to sell the franchise(s) to other organizations so they can do it right with time and attention to detail.
(Thanks, gamespot)
Every day we’re hearing of a company running through a round of layoffs or going out of business, it’s really not a happy time. Sony is not immune to the economic troubles either. Sony is talking restructuring and that involves a potential head count reduction of 16,000 jobs due to plant closings.
This leaves Sony with some hard decisions. Restructuring can mean drastic changes that effect all their product lines. The PlayStation 3 isn’t currently a shining example of high profit margins. The console needs time to reduce its overall cost, chip sizes and bring profitability. Is it in danger?
“Sony’s not in a position to halt all domestic production but it has to do something that drastic,” said Mitsushige Akino, chief fund manager at Ichiyoshi Investment Management. “If it announces plans to move production overseas while keeping only planning and development functions in Japan, that would be a positive.” (gamestooge)
The yen is losing value in our global economy making it more difficult to export the product and build any type of profitability plan. “A source said this month the company will likely suffer an annual operating loss of about $1.1 billion, its first such loss in 14 years” (news.yahoo.com) All this noise is making CEO Howard Stringer contemplate Sony’s involvement as a “software only” company, making us recall the changes at SEGA to this same result.
The Financial Times reported Sony will unveil details of its restructuring steps on Wednesday or Thursday. It said Chief Executive Howard Stringer was meeting with resistance from some executives to shifting the company’s focus to software from hardware and cutting jobs in Japan. (news.yahoo.com)
Is this just a case of a fearful executive trying to lay plans for a more stable future? Software is easier to develop, pays for itself quickly and becomes pure profit as it ages. Hardware requires constant upkeep at manufacturing facilities, chip reductions and a boat load of quality planning for first shipment. Would Sony go full software?
Let’s face it, Sony isn’t SEGA, they’ve been developing hardware for consumers since anyone can remember and they’ve been doing it with quality and market penetration. It seems absurd to think they’d forgo hardware designs in replacement of a full software solution to the problem. In addition, Sony has already invested a large amount of cash into seeing PS3 through it’s 10-year plan and letting that die now is realizing a huge loss on investment.
If Sony pushes through the economic and maintenance course, the PS3 will become highly profitable, much like the PS2 last generation (with a slower ramp up for sales). Even if they break even after ten years it seems a lot better than throwing all the effort away.
Perhaps Howard Stringer is talking “software” for the next generation home console? You think Sony will create a PlayStation 4?
This week’s episode is the final episode before E3, and next week, an outtakes episode filled with Dr. Who and Game of Thrones discussion will run. After that, we’ll have some serious E3 2013 discussion, especially about what happens with Microsoft and Sony in particular.
No Gaming Flashback, but news includes:
All that and Listener Feedback.
