According to several sources within Electronic Arts that were allegedly reported by Derrick Anderson at Startup Grind, EA is planning on letting go of at least five hundred employees as soon as this week, with titles Battlefield 3 and Star Wars: The Old Republic being seen as the main contributor. Although estimates put Battlefield 3 sales at approximately 13 million units, the company did pour $30 million in marketing for the titles. Star Wars: The Old Republic has seen a similar fate with a large sum of money being put into the marketing and licensing of the MMO. The game has sold about 3 million units, but subscriptions are already experiencing a steady decline.
EA has since gone and downplayed these reports, although the company never explicitly denied that there would be job losses:
“There are no lay-offs as such, we always have projects growing and morphing. At any given time there are new people coming in and others leaving. EA is growing and hiring and building teams to support the growing demand for digital games and services.”
Analysis: First off, the fact that EA has denied the layoffs hasn’t surprised me. Their response came off as very dismissive to me and I would expect for them to come out sooner or later and state that the company is going through some “restructuring.” Either way, things aren’t looking good for EA. Recently labeled as the worst company in America, coupled with the departure of Eric Brown and expensive acquisition of PopCap, Electronic Arts isn’t exactly sitting pretty at the moment. How I see it is that, especially in the case of Battlefield 3, EA were so determined to take the market away from Activision’s Call Of Duty series that the marketing was simply aimed to take away the same crowd, not emphasizing the unique traits and strengths Battlefield had over Call Of Duty. The market is already too flooded with realistic military shooters, and at this point, Call Of Duty appears to be too popular to be triumphed by another game of the same genre. I wouldn’t be surprised if even some longtime fans of the Battlefield series were turned off by the marketing approach and never ended up purchasing the title.
Now 13 millions sold titles isn’t bad at all. Hell, it’s really good. But the sheer amount of marketing that EA put into the title seemed like the only way a profit was going to be made was that EA was betting on anyone who owned a console, whether that be PC, Xbox 360, or PlayStation 3, to purchase Battlefield 3. Put simply, Electronic Arts wanted to face Activision in the battle for the leader of the online realistic military first-person shooter, got sucked into a battle, and lost.
The past few years have seen the quality of EA’s titles go up, at least in my opinion; and although the sales appear to be good, the rising costs of development, as well the amount of money spent on marketing and licensing, made it damn near impossible for Electronic Arts to walk away with a profit in hand. I’m not sure how EA thought they could honestly see enough sales to warrant all the marketing that the titles received.
I should mention that, as per usual, it’s rarely the fault of the people who are let go that the titles don’t succeed as much as planned, and I don’t see that being any different here. This failure seems to sit squarely on Electronic Arts’ marketing team and the higher ups at the company. Here’s hoping that anyone who lost his or her position soon finds another stable occupation shortly.