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EA's Quarterly Profits Down 31%
On the heels of announced layoffs, Electronic Arts reported reduced profits for the just-ended quarter. From the Gamespot article: "Whether the layoffs propped up EA's stock is debatable, as its share price lost over 2 percent of its value, $1.18. Trading was heavy indeed--twice normal volume, in fact, with 7.3 million shares changing hands. And no wonder: Shortly after the US markets closed, EA announced its earnings for its third fiscal quarter, which ran from October to December 2005. Besides being of great import to stockholders in the world's biggest third-party publisher, the report was seen by many as being a bellwether of the game industry's overall health."
So, selling upgrades as new products has finally been recognised by the general public, who are now tired of the EA tax every year?
Thats one option. The other is that they just slashed the price of most of their PS2 and XBox titles in an effort to maintain sales during the transition to XBox 360 and PS3.
The answer: stop working your staff into an early grave working on games that 10 years ago they wouldn't havae touched with a barge pole.
The implemented solution will be to release John Madden 2008 and FIFA 2008 in the summer of 2006 for the XBox Spinning Top and PS4 for $200 in an attempt to gazump its competitors. There will of course be collatoral damage, and a new record will be set with a EA developer dying from stress and fatigue before he's even been conceived.
Scared of flying, pointy things snce 1979!
I looked forward to playing Madden on my PSP. Which turned out to be one of the buggiest games ever released. The game crashed repeatedly and the load times were unbearable. It would even tease you and make you think that the load times were over at some points. Now, the load times are mostly Sony's fault(UMD is slow), but the crashing of the game was inexcusable and I stopped playing this after the first night I owned it.
I was wondering if anyone knows how console software sales were affected the year before the PS2 was released? It just seems to me that many consumers are choosing to save some of their money for the new consoles, and that the drop in revenue is nothing more than expected. Perhaps it's just me, but I've always felt that the quarterly system does not fit the video game industry very well. Judging the health of the company four times a year when their base products take eighteen months to develop just seems insane to me. Even with something the size of EA, dictating when a product needs to be out for the sake of quarterly earnings can only hurt the long term health of the company. I don't know, I guess I feel the world has watched "Wallstreet" one too many times. P.S. EA sucks
Don't release crappy games!
Don't buy crappy games!
But then a lot of people still watch Reality TV, so the Human species is basically a lost cause I guess.
EA is the worse company in the industry in terms of the way how they treat their customers.
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Just look at the whole mess around BF2 (Battlefield 2) - they had a game with the potential to be the BEST FPS of the decade an what did they do:
- Rushed it out the door with many bugs, unoptimized code (you need 2GB memory to be able to play it properly) and unbalanced gameplay (unbeatable airpower anyone?).
- Did not release a proper fix for several months. Even now it's still an unbalanced hog of a game.
- Instead of fixing the game, they invested their resources into getting a (payed) game expansion released after just a couple of months. This actually made the game even more demanding in terms of system resources and less stable. A second expansion is scheduled to come out this month.
- The game expansion added new weapons that could also be used in normal maps. Said weapons were more powerfull than the ones available to players with only the original version of the game, thus meaning that those with the expansion had a built-in gameplay advantage. This is pretty much the sleaziest way to push an expansion i've ever seen in this industry.
- All the while, any support requests registered in their site were magically going to the status "solved" without them actually solving anything.
Basically these guys keep treating their whole client base as (fanboy) teenagers and kids (which a lot of them are), while the demographics of gamers has been steadily changing in the last decade and the 25-35 year old males now form one of (if not the) biggest group of gamers.
Notice that 25-35 year olds have a lot more disposable income than teenages and kids
Meanwhile the rest of the industry has actually moved out of the 1990s mentality of "people are used to games that crash so we can rush them out the door"...
I am not surprised at all that EA's profits are significantly down.
Still, i hardly expect that EA's management will take the blame - i'm sure that, somehow, it was all due to software piracy
Maybe EA will realize they can't work their Devs to death rehashing old games and still keep people interested. Maybe MS will start making a *nix OS. Maybe pigs will sprout wings. It's a strange world we live in after all.
DIE, YOU FUCKERS. DIE FOR KILLING EARTH AND BEYOND.
That said, I sincerely hope the programmers working there get new jobs ASAP. But, yes. EA fucking sucks.
Thanks, EA, for killing two of my favorite franchises - Command and Conquer (whose universe EnB was set in, interestingly) and Wing Commander. You damn dirty apes.
+++ATH0
Me, I'm still busy with NetHack. But once I finish that -- any day now, really, or next week the latest -- I might take a look at this new-fangled stuff...
Was anyone on the Godfather team affected up in Redwood Shores?
I figure a lot of the losses have to due with the bombing of Madden among other sequels. The new features were almost non existant and the graphics and gameplay really haven't changed that much since 2001.
Maybe next year they'll have the new engine with skeletal animation and real physics etc that have been standard for 2-3 years now. I'm still surprised by the number of bugs present on what is essentially a game with 5+ years of dev time invested in it.
Of course they're branching off into an AFL football game and they've made Street ncaa etc... maybe the lack of dev focus on their core game, the differences between the 1000 iterations and versions, and the $20 competition has just caused widespread dissolution. It takes a lot more devs to make 10 crappy high profile games than it does to make one good one.
This just adds to the body of evidence that Google is the way you build a good group of people. Taking everything into account.
- -- Truth addict for life.
The Xbox 1 sales are plummeting (decreased to the half). The Xbox 360 sales can't even reach the Xbox 1 launch sales. This is the consequence of the low-risk multiplatform game companies.
I blame the internet on dodgy game releases now that require constant patching, playing games 10 years ago the titles did have their problems, but they were no where near as buggy as they are these days, it seems like developers know they can release titles with bugs & expect the general public to do their testing so they can patch the holes later.
Im not looking forward to the PS3 with online, I buy a console because I know I won't have to worry about game patching, it looks likes thats all about to change.I just hope the sony online service doesn't charge a service fee for me to update buggy games.
Their profits tanked, because their 'biggest' christmas title, Godfather, was delayed. Apparently it was so buggy and incomplete that even EA could not hash together a shippable build in time for holidays, and now it's been pushed back to late spring.
One 'major' title is easily 20-30% of their bottom line in a quarter.
Now the reason why they aren't improving otherwise is because they treat their customers like shit, and are ran by clueless idiots that chase the quick buck over long-term sales and customer loyalty - bit like every other megacorp on the planet.
World of Warcraft? That $15/month * 5.5 million could have purchased a large number of EA games.
they just laid off 5% of their employees..
Good karma sticks to me like velcro on a piece of plexiglass.
Move along, citizen.
Why do we need a new fifa game every year? Does the soccer rules change that much? Are the graphics improvements really that compeling?
I think that's one of the problems. Every year they release a bunch of sports games that are at least 95% the same as the the previous and they expect us to keep buying.
Maybe they should stop recycling games and increase investiments in better games.
I'm not seeing why people are moaning about EA's product quality. I stopped buying almost all PC game in the past 2 years as they're all buggy and badly written. I bought Civ4 and I had to actually pirate it to get my official copy to work. No more for me.
But let's look at the market and why it is operating the way it does. First of all, no company is getting boycotted for bad quality games. In fact, the average gamer that I talk to has no problem with a month or three of bugs -- it seems that the first few months is considered an open paid beta. I personally don't like it, but that's why I stopped buying games. Most gamers haven't.
Second, buggy games on the powerful PC platform is part of the reason why gaming companies love the gaming consoles. If everyone could afford a PC, I think the gaming companies might find the money needed to make the game correctly the first time, but they have a better platform to write for now -- powerful consoles.
Beyond that, we have to look at who EA is. I really hate it when people say "I hate Company YYY." That company is nothing but hundreds or thousands of independent producers getting together under one title to make a product. I see the same names on games over and over, so why aren't gamers taking it personally and avoiding games by the same people? I have 2 friends in the gaming industry (both whose names I see in the games I like playing) and I make it a point to let them know that I like what I'm playing. Yet when there is a bug (Morrowind comes to mind), I'll go out of my way to let them know that I'm pissed. Don't go to EA, go find someone involved in the game and let them know. Trust me, gaming design teams are a close knit community, word gets around quickly.
In the end, EA is providing the market what it has accepted as a level of quality: a not-quite-ready model of product selling before finalization. The more I think abou it, the more I realize I probably should accept this model. EA can't buy every hardware and software combination out there, and when I hear 10,000 other people complaining, I'm ignoring the fact that 90,000 people might be happily playing the game. Civ4 was very frustrating, but they eventually fixed it, and maybe they did because of some of my complaints. This is good for the market, to know that the company can adapt as quickly as it can.
Not to sound smug, but I have been saying for well over a year now that the game market is in a large slump and it is not this *huge* business that is raking in cash and clamoring for new, ultra expensive, consoles. Many, including the game publishers, have kept up a strong public wall of block-buster years and large profit hype... all false.
In the past month alone almost every Slashdot story has been about company after company in massive losses and huge slumps. Not surprising. The PSP and DS adoption rate has been fairly slow (until a few exceptions recently) and that was the beginning, then the 360 (even with low production massive excess in Japan, and surplus in many stores in the US now), and the balking at the PS3 price rumors.
The narrow market known as the "Hardcore" market is not sustainable, and companies are quickly seeing this. Nintendogs was the first big shot that made companies sit up and take notice. The "casual" market is where the money is right now and a major paradigm shift is in progress, the big losers? Sony and MS. If Nintendo can pull this off and possible create an alliance with SEGA, Sony and MS will have to throw in the towel and concentrate on the PC. Nintendo sheds piracy concerns, gains a super-wide audience, and as long as they don't royally fuck up along the way, it's in the bag.
http://teasphere.wordpress.com - A little spot of tea
Where on earth did you get all that from? Firstly, what are these "seemingly endless disasters" with the 360? They can't make them fast enough to satisfy demand, but what's new there with a console launch? Other than that and one game (DOA4) missing it's launch window - what's the problem? The japan issue really doesn't affect EA much, as Madden is hardly a big seller outside of the US.
This is the second time in a few months that EA management has specifically and publicly expressed their extreme displeasure with Microsoft and the 360.
Quote? Here's mine, from the CEO yesterday:
"We also had a successful launch on the Xbox 360 and expect that we will be the number one publisher on this platform in 2006"
Outside of some of the bigger sports titles, 360 projects are getting canceled at EA.
Really? Name one.
EA's management loved putting Microsoft in their place when they very publicly ignored the Xbox online service.
Now you're smoking. EA ignored XBL originally for sure, but the roar of disapproval from actual players was audible even in EA central. Guess what? Everything they do is now XBL enabled and has been for some time. Way to "stick it to the man". Please.
---- Den ene knappen er powerknapp, den andre er Bender voice knapp "Bite My Shiny Metal Ass"
No fair. You're using information when disproving a stupid statement.
"No fair. You're using information when disproving a stupid statement."
Replying to your own stupid comment.
Fucking retard.
They first put out a simple patch, then a patch that broke more stuff than it fixed, and then a patch to fix the previous one and a couple more things.
Damn, I am thinking about working for EA now :) Tell me one other tech company that would have quarterly profits go down by 31% for like the 2nd or 3rd quarter in a row and still keep 95% of its work force. I know IBM and Intel are not that nice.
It's only the quarterly profits, right? Nothing to get worried about. At least that's what everyone says when it's about corporations only looking at short term profits....
oblivion was also delayed, and Im sure there were others other than just doa.
battlefield 2 is givin me problems.
Go read the reviews for this PC game on Amazon. http://www.amazon.com/exec/obidos/tg/detail/-/B000 9YJM9W/002-6493180-4009643?v=glance
Seriously, it is about 99 out of 100 negative. I wish I had read those reviews before I bought it for my kids. The previous three HP games they made were very decent. This 4th one was awful. The worst thing about it was the way in which the game maintains a helicopter eye's view of everything. Instead of feeling like you are part of the action, it feels like you are watching somebody else play the game.
My kids have played the first 3 EA Harry Potter games hundreds of times and never tire of them. This 4th one, they barely touch after seeing how bad it is. I was assuming that the company just issued a clunker or was just fucking over their HP fans, whom they felt they could take for granted, in this one situation. But reading the other posts here, it is clear that their quality must have gone down across the board.