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Jul 09, 2007



Microsoft uses the Borg approach, and I wouldn't be surprised if EA did the same... Find a game that works, buy the company (or one of its competitors), and create a franchise... oops... that means more sequals.

If a product from a small company fails, no one (aka: the press) notices it; the small company tanks. If a product from a large company fails, people do, and the failure tarnishes the image of large company's many successful products... which is bad.

McDonalds works the same way: They have McPolice that secretly visit the franchises and make sure they're all up to snuff. The reason being that if one bad McDonalds gets bad press, they all do.


The traditonal answer is that it's about managing risk within a larger portfolio, right? As in most studios go for the hits business model where one big hit pays off for all of the other duds. This has meant looking for the big, mass, mainstream hit every time the studio is at bat (cue Michael Bay). The alternative is the Miramax approach, which involved mixing more risk in and shooting for medium and smaller niches. What's a massive, mega-conglomerated 800 lb. gorilla to do?

Well, they surely ought to spin off a boutique division and pull a "Saturn". But I won't hold my breath. There is far too much inertia in a company that big. Getting them to embrace some level of risk is like getting a tanker ship to make a 180 degree turn. The only likely method is an independent subsidiary that is freed to develop its own corporate culture and to take some risks. And that's only going to happen with some serious change from the top or a revolt from the board (or shareholders), which is only spurred on by a drop in share price. And so long as JK Rowling keeps writing source material (uh oh!) and the NFL keeps performing, they have little incentive to change their approach.

IGDA head Jason Della Rocca had some interesting thoughts just before this EA statement:

It's on the point, although I don't expect it to turn any tankers around soon.


EA has a problem, it is not growing the way it used to. Riccitiello hasa to find ways to grow the company or the stock price will remain level or drop and he will be replaced.

New types of games are one way to grow the market. Imagine the reaction if he had said "we are going to find ways to increase revenue from the existing franchises/genres." Everyone would have known that is impossible, and he would have been trashed.

Of course trying to be more creative may make EA grow or it may not. But more of the same will not make it grow.

I do agree that it will be hard to beat the institutional intertia that comes from (what has been) a very successful growth strategy. Usually companies have to experience a lot of pain before they change, look at IBM in the early 90s. Of course plenty of companies go through pain and do not change, they just disappear. This will be interesting to watch, and likely a bonanza for consultants.


I don't think failure damages a company in terms of its image. Sure, it hits it in the bottom line, but I don't think any less of them for going out on a limb and trying something new even if I don't like it, and I doubt anyone else does either unless they bought the game. As long as they delivered a working, interesting product, that's fine with me. My worry is that the customers are at fault here. I know that for the most part the games I buy and play are unoriginal and that I stick to things I've already enjoyed. I know that the games I'm looking forward too the most right now are all sequels of various kinds. It's tough coming up with something new that's up to the challenge.


I think this is great. For years, EA has been accused of upholding the status quo -- of *being* the status quo. Now, the status quo is that major publishers have to release interesting, approachable games with unique IPs in order to grow. Sounds good to me.

I wonder if EA's recent reorg into four vertical units is a first step towards a boutique Saturn or Miramax kind of branding. Although I suppose Maxis was sort of there already and is being subsumed into the core "Games" imprint.


Maxis was subsumed into EA Games several years ago when all but the Spore team moved from Walnut Creek into the Mother Ship in Redwood Shores. This new re-organization may be turning the freighter around as Dmitri said. But I don't yet see it as turning toward a Miramax/Saturn strategy, which would be a great move (and hey, if GM can do it, why not EA?).




It's also possible that he frankly means what he says. Occasionally a CEO comes along who looks at the market and at his company and sees a dangerous trap or cul-de-sac looming ahead. It's pretty rare that a behemoth corporation learns to be nimble again, but it does happen (the Miramax/Saturn gambit being one common way to do it). I think his analysis of not just his company but the industry is pretty spot-on: game production is even more risk-averse at the moment than other cultural industries. There's plenty of reason to think that there are very large potential markets out there for video and computer games and it's equally clear that you're not going to get to them by pouring a lot of energy and money into Gears of War 2 or Halo 3 or any other game-for-gamers.

Another way EA could look at this: make a PARC for gaming, a separate blue-sky research institution. (Yeah,I know, I know, Xerox didn't exactly benefit from PARC's early innovations, but that was their own damn fault. The concept was a good one.)


Tim> Another way EA could look at this: make a PARC for gaming...

What a neat idea. Even on a small scale, wouldn't that be fun!


Lordy, sign us all up!


and off in the distance a brilliantly creative garage game maker tinkers away on an infernal machine no one will ever see.



Timothy Burke said, "There's plenty of reason to think that there are very large potential markets out there for video and computer games and it's equally clear that you're not going to get to them by pouring a lot of energy and money into Gears of War 2 or Halo 3 or any other game-for-gamers."

Or at least not in the traditional way of graphics and content. Whats interesting about the Halo series is the way it appeals to more casual gamers. With close ties to the college dorm scene here at UCI, Halo seems to offer a more social experience for players of both sexes, a means to get together after a day of classes...a social networking tool. It seems there is profit to be made offering various platforms for competitive social interaction at least on the college campus. Yet Monopoly or Twister online doesn't seem to be the solution.


I could have told them that just by looking at my EA stock this past several years. :(


It could be hopeful, but that would mean Riccitiello was being bold. Maybe it's true that he needs to do something bold to stir the company out of its doldrums, but (color me skeptical) only time will tell if he's going to back up his words with real actions.

But don't get me wrong, I understand that game makers need to turn profits. The movie making analogy is a good one. There are lots of great "independent" movies being made. Will they ever get big audiences? Probably not, but that's OK. The makers love making good movies, so they keep on (generally) as long as they can pay their costs and some. Here's hoping that people who love games will do the same.

And @dmx: if the garage game builders make great games and put some effort into publicizing them somehow, they'll get recognized and grow/spread.


Frankly this comment seems like a well-crafted way up upping buzz on Spore and such by upping the stakes on reputation.

If he says "you guys are all wimps!" he has to perform.

EA news is always big gaming news because EA is big. But if he exposes himself with a gladiatorial stance, then the press will be hoping to see blood, and will pay special attention to him for the next bit.

Yes, in fact, I am a *special* kind of cynic. It comes from being a media critic my whole life, and making my money as a spin doctor for the last decade of it. ;) As my son says, "My mom used to be an engineer, but she went over to the dark side and now she works in marketing."



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I'm generally in favor of Riccitiello's comments if they're backed up with action. If EA makes more interesting games, everybody wins.

But I have to admit I'd be even more impressed if the folks at EA and elsewhere addressed the point that Greg Costikyan and others have so eloquently made (as in Death to the Games Industry), which is that the biggest impediment to making the game industry one where innovation thrives is the insane cost of creating a game with solid production value. A price tag of $10M or more limits the number of participants to the EAs and Sonys and other behemoths, and only encourages them to play it safe with sequels to the occasional hit. If Riccitiello really wanted to encourage innovation in the game development industry generally, he'd find a way to reduce the costs of developing high-quality games.

Over the long term, it's not a bad thing for EA if it becomes a little less risk-averse. The short-term loss from more "failures" should (in theory) be offset by the longer-term increase in revenues from increasing the odds of finding new hit games. That benefits both EA and gamers.

It's just not as helpful as a Multiverse, or a SOE whose Platform Publishing is helping smaller MMORPG developers reach wider markets. EA being more open to "crazy" gameplay ideas doesn't do anything to lower the cost barriers to entry for more/other game developers, who might have even crazier ideas. Growing the whole industry would benefit every participant, including EA.

Of course EA's not required to directly help anybody but EA. The question is whether helping the entire game industry by reducing the cost for anybody to create good games would do more for their long-term bottom line than just helping themselves.

Not an easy concept to sell, I suppose.



Cost is a huge impediment to indie developers -- one I don't expect to see EA helping with unless those developers are roped in tight first, as it's in their best interest to raise the cost of entry to others (at least from a first-order analysis, until you take into account the fact that they're "boring people to death"). Even then, the risk of funding as a publisher increases as the budgets rise. There are other ways to reduce development costs, but they often involve re-thinking the entire development equation.

Groups like Manifesto Games are refreshing but, in all honesty, I'm not sure they're helping many developers that much. Last time I talked to those guys (whom I greatly respect), they weren't funding games themselves -- just helping indies who had built their own game on a shoestring or obtained funding someplace else distribute and market them. Maybe this has changed. But if not, it leaves unresolved the single biggest point of pain in developing a non-boring, non-derivative, non-corporate game.

Similarly, free-to-use (or nearly so) toolsets in the online worlds space like Multiverse, Torque, Kaneva, WorldForge, etc., attract a whole lot of people who want to make games, but in all probability have little knowledge or experience, and thus little chance of completing one, much less making one that's a commercial success. This leaves something of a wasteland between the big corporate studios on one side and the toolsets catering to "wannabes" on the other. As costs grow larger, this rift widens.

There are other publishers and funders stepping into this no-mans-land, if somewhat tentatively and quietly, offering seed funding for developers who may or may not come through, and keeping those who do. It's a solid long-term strategy, one I'd like to see more publishers embrace.


I mostly agree with Zvi who wrote:

"My worry is that the customers are at fault here. I know that for the most part the games I buy and play are unoriginal and that I stick to things I've already enjoyed. I know that the games I'm looking forward too the most right now are all sequels of various kinds. It's tough coming up with something new that's up to the challenge."

The closest I came to try innovative games is Wii, since I would really dig playing tennis at home as a physical exercise. Even there, I did not take a plunge, since I heard that you can just sit on a couch and flip a wrist with the controller instead. :(

Spore leaves me totally cold as did most of released innovative games. "Black and White"? Have it somewhere, never played. "The Movies" - never even got it. "Sims" - same thing (oh, it may not be considered innovative now, but it was when it was released).

Although some innovative things do attract people's attention. "Myst" was one ages ago, "Sims" was another, MMOGs as a class is yet another. "Dance dance revolution" maybe? Wii controller based games might be another class?


Riccitello dude is right.

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