Electronic Arts isn't doing very well at the moment, and Electronic Arts would have you believe that's all the economy's fault. However, former EVP Mitch Lasky has a more damning reason for EA's failings -- it's the fact that Electronic Arts has totally dropped the ball.
"While Activision was setting sales records with Call of Duty: Modern Warfare 2, EA had no major hits," writes Lasky, "although, in fairness the COD:MW2 revenue was probably just filling in a sinkhole at Activision created by a music game business that has fallen off a cliff. EA is in the wrong business, with the wrong cost structure and the wrong team, but somehow they seem to think that it is going to be a smooth, two-year transition from packaged goods to digital. Think again.
"The old EA model was a basically a three-legged stool: 1) a profitable, recurring sports business (Madden, FIFA); 2) franchise games that produced big hits on a less frequent basis (The Sims,Need for Speed, Command & Conquer); and 3) a collection of digital assets (e.g.: Pogo & JAMDAT, and now Playfish) and distribution/partnership titles (e.g.: Rock Band & Left 4 Dead). Of those, the only stool leg left intact is the third one. Without the digital assets and the EA Distribution titles, they'd be in even more serious hot water."
Lasky says that EA executives weren't bold enough to scale back certain games to cut long-term costs, and that its sports licenses have been "hamstrung" due to the increased money involved. However, it's the EA Games division that is the company's biggest failure, according to the former EVP.
"From Spore, to Dead Space, to Mirror's Edge, to Need for Speed: Undercover, it's been one expensive commercial disappointment for EA Games after another. Not to mention the shut-down of Pandemic, half of the justification for EA's $850MM acquisition of Bioware-Pandemic. And don't think that Dante's Inferno, or Knights of the Old Republic, is going to make it all better. It's a bankrupt strategy."
Incredibly scathing stuff. Make sure to check it all out on Lasky's blog.
Contest:
10:00 AM on 01.14.2010
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They're profitable enough that someone would pick them up.
I seem to recall EA's line up being pretty decent last year.
I dunno what the deal is there's so many different theories being thrown around. Of all the EA titles I can recall over the last 2 years they all definitely had audiences and have all done north of okay critically. I just don't know what's going on. Their advertising has been top notch. Their timing doesn't seem bad.
unless they do indeed go bankrupt, i don't see any major issues other than them not being #1_in_the_hood_G!!
Good games aren't worth it, and rehashed games make more profit.
EA finally start showing us some new, interesting IPs, and they're going bankrupt for it!?
I have never hated my fellow games as much - Fuck You All! I hope you're happy with yet another Call of Duty, and Virtual Tour: Jerusalem/Venice.
Ahem, I meant "gamers".
And I still hate you all!
You'd have a lot more money if you hadn't bought exclusive rights to the NFL and NCAA like a bunch of pussies.
Rot in your own filth,
Love Lydeck.
@Lydeck - You're absolutely correct. I'm appalled that so little uproar was caused after the purchasing of exclusive rights to those licenses. It's a complete bitch-move that stifles competition, which is the driving force in a capitalistic market. It's literally disgusting to me.
Answer: Start buying their games.
People claim to want all this new and original game content, and then fail to follow through and buy the stuff, opting to buy the franchise sequels they claim to be tired of. This includes buying the DLC you think should be free (which shouldn't). Also, stop giving support to the super franchise bullshit that comes out of Activision. Show them your precious wallet-monies go to original awesome things, not rehashed franchise things. Unfortunately this concept won't even occur to alot of the gamers out there who just don't care. They'll eat up whatever is shoveled to them, and rather than research new things, if its a name they don't know, they won't drop money on it.
Look, even if a game sells gangbusters and gets perfect scores across the board, if the investment into it is excessive it's still going to be tough to turn a profit. EA can make good games, they just shouldn't go overboard with the development and marketing costs. Of course, then they run the risk of not moving enough units.
Soooo... yeah, they're screwed.
Thisthisthisthisthis.
Still makes me sad though, considering the first thing they'd cut would be a game like Dead Space 2. Makes me want to go buy a few digital copies of the original for my friends.
MONEY = PERSONAL VALUE yet it also unfortunately equates to self sustainability which is a fraud because were all codependant whores here.
/rant
That's why they should just throw all their cash into Rock Band DLC. Right guys? Right? C'mon we need some decent DLC over here. For a game dependent on DLC the licensing department has been really sluggish lately.
And this guy is basically saying that new IPs are bad for business and EA need to feed people with putrid. These motherfuckers. I think it's wrong to give this kind of policy any publicity. Just like with Def Jam. I really am amazed impudent these bastards are, they've got balls to say that they want to make more money with less effort.
Jesus will rape their mothers with a shotgun.
Hell, FF13 has to sell on the level of their best ever selling title, FF7, to break even. That's not a viable business model.
The thing is strategies have to be adaptable and change. The older EA had a bad name with one of their core demographics (interested or "hard core" gamers) and they had to do something to change that to be profitable in the long term. I have to question the guy's intelligence if he did not see that.
@GreatRedneckHope What is wrong about making a product targeted for a specific audience? Is the game some sort of exploitation? Should white people not be able to sell things to black people, or give things away at cost? Should only black people be able to sell things to each other?
I understand that seeing a dorky white guy in a suit rapping would register largely on the Cheesy scale, but I don't get your complaint.
Wait, WHAT!? (Oh, for got the obligatory "FUCK YOU Bobby Kotick"!).
Learn to paragraph. You could have the greatest insights in Dtoid history, but few people will read a big block of text like that.
Learn to paragraph. You could have the greatest insights in Dtoid history, but few people will read a big block of text like that."
Agreed. I stopped after about line 3 when I saw how much more was to come.
Yes, yes it did, as well as many other games they have produced/published.
This dude sounds bitter that he got "laid off" or whatever excuse he conjures. EA may not be the most efficient Media producing monstrosity on the planet - but i would rather have them around than not at all.
After suffering through both Mercenaries 2 and now Saboteur...I suffer through them because there are really fun open world shooters buried underneath, especially Saboteur...but what it's underneath is a LOT of garbage.
My God, for all the good bits from the acting to the type of missons, Saboteur does not look like a game with years put into it.
Graphics that are barely above an Xbox original game, more glitches and weird characters stuck on things than I can recall EVER seeing, a world that can't even load itself without pausing the screen while I'm in the middle of the simple task of driving down the street, animation hitches left and right....hell, I had a scene that loaded the sky wrong. How do you load sky wrong? Absolutely no polish and huge lack of quality.
They didn't actually fire everyone at Pandemic, at least half the team was kept and absorbed into EA LA, one of EA's new divisions.
The people they got rid of were the people not doing their job and making the low quality state of Mercs 2 and Saboteur.
Hopefully the people with the good gameplay ideas can now work with people who know what they're doing, because Pandemic fell to sh*t all on it's own, not because of EA.
I'm all for damning a corporation when they do wrong, but I only see right in shuttering what Pandemic had become. When EA bought them, they were still making good games. EA got burned like Microsoft did with Rare.
Truthfully? This shouldn't be a huge surprise. Building cool original IP is a long-term strategy, not a short-term one. From the titles they've released over the past couple of years, they've restored a lot of trust with the fanbase - people don't see EA as the evil empire (completely) anymore. I'm now excited to see what titles they might come up with this year and next; the list above is full of titles that, while they didn't hit sales expectations, are critically acclaimed (and also awesome).
However, in the short term, when you create new IP, you're not bringing along your old fanbase that is programmed to eat up Madden rereleases every year. New franchises take time to build up a following - more than a couple years, like 5 or 10 years really. It requires a different strategy - you have to cut your costs, work with smaller budgets, come up with some creative marketing strategies that don't cost an arm and a leg. And it's going to be hit or miss; you can't guarantee that an experiment or new IP will sell strongly. But it's not a waste of money to try, if you learn something and built better games as a result.
So you're going to see a loss in the short term, and hopefully gains in the far term. It's a good philosophy, and suited for digital distribution where you don't have to invest as much in manufacturing and such. But instead of fully adapting themselves to it, EA seems to be still running itself like a juggernaut, spending mad money on huge AAA releases that just get more and more expensive. And execs don't really care whether or not what they do is "good for gaming."
EA's change from evil megacorp, to decent developers/publishers, creating new IP has changed them for the better. I for one have supported them more since their change and will do soon, with Mass Effect 2, Dante's Inferno etc. So long as EA go this more positive route, I'll support them. They also listen more to us gamers, which puts them more on track to do better, a vital thing they didn't care about before. Even in business, you cannot build an empire in a day.
This way they can still do their sports games, and give us something cool as an option besides. I don't think this should be seen as a bad thing, since every business has ups and downs. Perhaps this Ex-EA chap should come back once the year is over, and EA's takings can be scoffed at.
He criticizes them for being beaten by the competition, while ignoring the fact that using your own milked franchises to fight other milked franchises doesn't work. Especially when the other guys still have fresher stuff, even if Activision is doing their best to fuck that freshness up.
What a moron.
How does holding down A to do every possible contextual action amount to more substance than Mirror's Edge? Substance was exactly what it did right, at the expense of freedom and exploration.