Heads rolling: EA axes 600 employees |
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Publishing giant and corporate overlord, EA Games, put into effect a cost reduction plan citing a general weakening of the retail market as the main cause. "Considering the slow down at retail weÂ’ve seen in October, we are cautious in the short term," said EA CEO John Riccitiello in the company's results statement.
The major publisher's cost reduction plan includes a reduction of its work force of about 6 percent, approximately 600 employees. It will be a global reduction, not just focused on one studio or one location. Through the layoffs, the publisher hopes to gain pre-tax savings of US$ 50 million.
I admit I hard had a time swallowing this news, at first, since EA seemed to be in pretty good shape lately with the strong launches of Madden NFL 09 (Nintendo DS, PSP, PS3, Xbox 360), Spore, Mercenaries 2 (Xbox 360, PC, PS3) and Warhammer Online. Add this to the strength of their previous titles and one has to wonder why they're choosing now to trim the fat.
According to their financial statement, EA's overall revenues rocketed to US$ 864 million, a 33 percent boost over last year's US$ 650 million. Problem is, their losses grew by around 37 percent too, from US$ 195 million to US$ 310 million. A fairly alarming stat in the face of a slumping economy, which, until recently, many felt would not greatly impact the gaming industry.
Riccitiello ended his official statement with a hopeful note, however, saying:
Longer term, we are very bullish on the game sector overall and on EA in particular. The industry is growing double-digits on the strength of three new game consoles and increases in the number of homes with broadband internet connections.
Included in the studios that will be experiencing the layoffs are Los Angeles and Pandemic. Keep it tuned here for more news on this issue.
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Comments [refresh]
You crap on customers who rightfully complain about a DRM mechanism that can effectively disable a computer's OS and installs like a trojan... could it be a "slow down at retail" perhaps?
This is because of a new direction EA is taking. It has nothing to do with sales.
a greedy new direction. $50 million in savings. Too bad they buy up lots of studios then do this.
Uh, I may just be an old fart that has no business on the younger gaming generation's info-site, but until one of us OLD gamers makes a site... I'll just use you folks as a bouncing board...
Back when console gaming was coming into it's own and home computers were JUST starting to rear their bobbling heads, corporations as a whole were scamming and screwing the consumer for all they were worth. Basicly this idea of "you bought it, you deal with it mentality". Eventually this led to several companies getting swallowed by bigger fish.
Long boring story short, the big fish have gotten SO large that they can't defend off the very fish they were feeding off of.
Hit the 'way-back' machine to the 30's, rampant runaway companies, screwing the consumer and the worker caused this little thing named The Great Depression. Now it is at this point I would like for folks to take special notice....
Schools today may have gone greener and may s***** feed kids information in a "protected" environment. You know, take the fright and sting out of those nasty things that happen in life (despite whether you decide to see them or not). When the big fish back then literally lost everything, they really did do the right thing. They took a deep breath, let it while letting their shoulders slump forward and their gaze fall to the floor and then jumped out the ****ing window from the 20th floor.
That's what your supposed to do when you screw over several hundreds of thousands of folks out of their livelihood, so you could dance like Mr. Big Balls. I wonder if the EA execs (the ones raking in millions for having moved a piece of paper from one side of the desk to the other) will have the common balls to take a leap when they get found out?
It's the least of the right things they could do. You know damn well they won't give the money back or slash game prices 'possibly' alleviating one of their claimed reasons for loss.
Then I could just be the 300 lb old fart sitting in the room...
Nuff Said...