EA's Profits Up, Workers Get Layoffs

Gamespot and GamesIndustry.biz has the news from yesterday's conference call where EA CEO Larry Probst reported higher earnings for his company in Q3, despite a small yearly decline. He also held forth on the future cost of next-gen games, which in his opinion will likely stay as high as $50 and could perhaps fetch more on retail shelves. Just before this story was to be published, Tim Butler wrote in with the news from 1Up.com that EA was laying off members of its LA studio. From the article: "According to sources close to the company, Electronic Arts is currently in the process of laying off between 50-70 team members from its minty-fresh new EA LA office. The teams affected worked on the poorly-recieved GoldenEye: Rogue Agent and the forthcoming Medal of Honor: Dogs of War FPS titles." Update: 01/27 06:34 GMT by Z : Update to the layoff article: "The first step is to rebalance the team. This has required us to let go 60 people -- from many different teams. There is no focus on any one team or any one class of individuals. It's a studio-wide thing to reset the business fundamentals and get the studio to the next level."

Comments

If the game was bad

[Anonymous Coward]

shouldn't they be held responsible?

Why should they be carried by better producing teams if they couldn't?

This is Not a Layoff

[techsoldaten]

Don't look at this as a layoff.

This is an invitation to enter the field of merchandising the games they built directly to consumers at the retail level. WalMart, Best Buy and Target are all hiring, and can use people knowledgable about the games themselves.

Seriously, how much money does that company make from building these games? All the hard work, blood, sweat and tears that go into being an EA employee and this is all they have to give their developers. And you know their executives are going to receive higher bonuses this year for trimming the fat.

I guess all we can say is thank you for the nedless hours of high-tech distraction your guys have provided us, at least the gaming community appreciates you.

M

the person who should be fired for goldeneye..

[glenkim]

I talked to a friend who was actually one of the game designers for the new Goldeneye game. When I found out he had worked on it, I told him that the game looked pretty crappy and he told me the reason. Apparently, the producer of the game wasn't happy with the initial draft of the game's script... so he went home and rewrote it. by himself.

BOFHs writing games? Yeah right, I hope his ass was canned.

Prices

[Ra5pu7in]

future cost of next-gen games, which in his opinion will likely stay as high as $50 and could perhaps fetch more on retail shelves.

I can already tell you that if every next-gen EA game comes out on the shelves at a $50+ price point, I'll simply turn to other games (or, more slyly, wait until the games appear used - in which case EA gets no profit out of the resale). They may hold certain niches, but they don't own the market ... no matter what they have convinced themselves of or how many developers they buy out.

Re:Prices

[alphaseven]

Midway is experimenting with lower prices, they lowered the upcoming game NARC from $50 to $20 recently, they're predicting they'll make it up on volume. Lower prices doesn't mean less profit, the success of ESPN recently and Katamari Damacy may be evidence of this.

I remember reading there was similar debate in the industry about DVD pricing, some studios (Disney? Fox?) thought DVDs should be cost far more than the current $20 because movies budgets were increasing. Instead the low price for DVDs turned out to be a real boon for the industry.

Re:Oh no!

[jxyama]

there are many companies that are "businesses" but don't act the way EA has. goldman sachs comes as one example of a very profittable company that has also been commended for its fair and dignified treatment of the workforce.

not all businesses are alike. pursuing profits isn't mutually exclusive with treating its employees with respect.

the way EA is doing business is one way, and it's their way of doing things. personally, i'd never work for or buy products from company that seems to show absolutely no compassion in its business practice or for its employees. that's my way of doing things in response to such companies. and i doubt that i'm alone.