The EA Rumor mill is turning again and this time it might be the current CEO that gets ground in it's turning. If the rumors are proven true, then John Riccitiello might be on the way out to be replaced by Peter Moore. Two reasons were cited for this possible change.
Faling Stock Prices
It's true, EA is taking a huge hit in income, for various reasons. Lets start with SWTOR, the $200 million gorilla in the room. EA's stuck with it, they financed it and the game has launched. This bill is coming due, and while the game launched strong with 1.7 million subscriptions reported in January, in April that had dropped to 1.3 million. More troubling than that is Bioware has announced they are merging 87% of the servers. Now this isn't as dire as it sounds, but it's still a shock, almost every patch has included "Server Stability" updates. Now I remember around launch the heavier populated servers would "Flutter" here and there causing disconnects and on occasion crash. Caps on population were put in that were fairly restrictive. As subs have dropped and those stability issues have been corrected having or 100 servers simply doesn't make sense anymore. This action though doesn't look good to the public and there have been plenty of cries of DOOOOOOOOM! among the player base, even while updates to the game such as expanded legacy system, and group finders have been fairly well reviewed by critics.
Another area EA has taken a hit is in the social gaming arena, they simply haven't "clicked" yet in an area that new start ups like Zynga are dominating. Zynga founded in 2007 focus' stongly on Social games and turned a profit about 1/4th of what EA did last year, with decades less experience to build on. Social Gaming is the next frontier in gaming, and EA is showing up late to the party. Their "Big Announcement" in this area at the San Diego Comi-Con was a F2P title based on a neglected franchise in the form of Ultima Forever, but more on this in a moment.
Lastly EA hasn't joined the "Freemium" or "F2P" bandwagon for major titles, and surprisingly they have maintained a staunch opposition towards moving towards this for older titles that are in their twilight days. A good example of this is the Grand-Daddy of all Modern MMO's Ultima Online. UO has been stripped down to just a handful of developers working out of a small studio space in Virgina which they share with the developers of DAoC. This isn't speculation, I've been there, I've spent a wonderful evening chatting with many of the developers and some of which are no longer with EA, and honestly I was surprised at how few of them there are. A move to a Freemium or Hybrid Free to Play platform for this aging gaming would help them with it's greatest weakness, competition. UO has been emulated more than any other MMO, it has a Emulation Community that is active, and larger than it's legit player base. Give these people who are enjoying the Emulated servers a reason to come back and they might. They pay for the content they want and pick up bits and pieces over time, and UO increases it's profits. A server framework designed to support many more people than it currently does, will be used to closer it's potential, and honestly it won't cost EA much more to maintain.
The "Tension" issue.
It seems every title EA has released that requires maintenance it seems that as soon as there is a down tick in profits from that area EA cuts support. It's happening to SWTOR, as members of Bioware Austin are being laid off, a studio created strictly to work on SWTOR. Other studios are taking cuts as well, and yes I understand if profit drops you have to do something to compensate, but removing talented, creative minds doesn't seem to be the answer. Where do you go when all you have left are the grunts? If EA had embraced and rode the flow of the market and adopted some of the changes in the market sooner, and in a larger scope then they might now be in the situation they are in now. Ultimately these decisions fall on the CEO, there is no excuse he/she is in charge and the over all health of the company is set firmly on his shoulder. It seems the repeated trend of cutting staff has created "Tension" in the work place at various studios, possibly in the form of a "Fear of Failure". This is never good in an industry that thrives on entertainment and creativity, while it's ok to fear having a bad showing, when it comes to the point of being oppressive then there is a serious problem. It damping creativity and imagination the essence of the industry.
Why Peter Moore might be a good fit.
Well first off he recognizes the potential of Social Gaming. Secondly and possibly more importantly he's a proponent of the Hybrid Free to Play (Freemium) and Free to Play concepts. He knows this is the direction the market is headed and he's willing to head in that direction. Going this route if he steers EA in this direction could increase profits in existing titles, but also help revitalize older titles expanding their value.
Secondly he's a fresh face that is respected and from all the interviews I've seen he seems more "down to earth" and friendly than the current CEO. This can't hurt, and hopefully he'll be able to gain the trust and ease the tension in the studios so they can get back to doing what they do best.
- Falling stock prices
- "Tension" between the current CEO and the various studios.
Faling Stock Prices
It's true, EA is taking a huge hit in income, for various reasons. Lets start with SWTOR, the $200 million gorilla in the room. EA's stuck with it, they financed it and the game has launched. This bill is coming due, and while the game launched strong with 1.7 million subscriptions reported in January, in April that had dropped to 1.3 million. More troubling than that is Bioware has announced they are merging 87% of the servers. Now this isn't as dire as it sounds, but it's still a shock, almost every patch has included "Server Stability" updates. Now I remember around launch the heavier populated servers would "Flutter" here and there causing disconnects and on occasion crash. Caps on population were put in that were fairly restrictive. As subs have dropped and those stability issues have been corrected having or 100 servers simply doesn't make sense anymore. This action though doesn't look good to the public and there have been plenty of cries of DOOOOOOOOM! among the player base, even while updates to the game such as expanded legacy system, and group finders have been fairly well reviewed by critics.
Another area EA has taken a hit is in the social gaming arena, they simply haven't "clicked" yet in an area that new start ups like Zynga are dominating. Zynga founded in 2007 focus' stongly on Social games and turned a profit about 1/4th of what EA did last year, with decades less experience to build on. Social Gaming is the next frontier in gaming, and EA is showing up late to the party. Their "Big Announcement" in this area at the San Diego Comi-Con was a F2P title based on a neglected franchise in the form of Ultima Forever, but more on this in a moment.
Lastly EA hasn't joined the "Freemium" or "F2P" bandwagon for major titles, and surprisingly they have maintained a staunch opposition towards moving towards this for older titles that are in their twilight days. A good example of this is the Grand-Daddy of all Modern MMO's Ultima Online. UO has been stripped down to just a handful of developers working out of a small studio space in Virgina which they share with the developers of DAoC. This isn't speculation, I've been there, I've spent a wonderful evening chatting with many of the developers and some of which are no longer with EA, and honestly I was surprised at how few of them there are. A move to a Freemium or Hybrid Free to Play platform for this aging gaming would help them with it's greatest weakness, competition. UO has been emulated more than any other MMO, it has a Emulation Community that is active, and larger than it's legit player base. Give these people who are enjoying the Emulated servers a reason to come back and they might. They pay for the content they want and pick up bits and pieces over time, and UO increases it's profits. A server framework designed to support many more people than it currently does, will be used to closer it's potential, and honestly it won't cost EA much more to maintain.
The "Tension" issue.
It seems every title EA has released that requires maintenance it seems that as soon as there is a down tick in profits from that area EA cuts support. It's happening to SWTOR, as members of Bioware Austin are being laid off, a studio created strictly to work on SWTOR. Other studios are taking cuts as well, and yes I understand if profit drops you have to do something to compensate, but removing talented, creative minds doesn't seem to be the answer. Where do you go when all you have left are the grunts? If EA had embraced and rode the flow of the market and adopted some of the changes in the market sooner, and in a larger scope then they might now be in the situation they are in now. Ultimately these decisions fall on the CEO, there is no excuse he/she is in charge and the over all health of the company is set firmly on his shoulder. It seems the repeated trend of cutting staff has created "Tension" in the work place at various studios, possibly in the form of a "Fear of Failure". This is never good in an industry that thrives on entertainment and creativity, while it's ok to fear having a bad showing, when it comes to the point of being oppressive then there is a serious problem. It damping creativity and imagination the essence of the industry.
Why Peter Moore might be a good fit.
Well first off he recognizes the potential of Social Gaming. Secondly and possibly more importantly he's a proponent of the Hybrid Free to Play (Freemium) and Free to Play concepts. He knows this is the direction the market is headed and he's willing to head in that direction. Going this route if he steers EA in this direction could increase profits in existing titles, but also help revitalize older titles expanding their value.
Secondly he's a fresh face that is respected and from all the interviews I've seen he seems more "down to earth" and friendly than the current CEO. This can't hurt, and hopefully he'll be able to gain the trust and ease the tension in the studios so they can get back to doing what they do best.
