EA's Profits Up, Workers Get Layoffs 436
Gamespot and GamesIndustry.biz has the news from yesterday's conference call where EA CEO Larry Probst reported higher earnings for his company in Q3, despite a small yearly decline. He also held forth on the future cost of next-gen games, which in his opinion will likely stay as high as $50 and could perhaps fetch more on retail shelves. Just before this story was to be published, Tim Butler wrote in with the news from 1Up.com that EA was laying off members of its LA studio. From the article: "According to sources close to the company, Electronic Arts is currently in the process of laying off between 50-70 team members from its minty-fresh new EA LA office. The teams affected worked on the poorly-recieved GoldenEye: Rogue Agent and the forthcoming Medal of Honor: Dogs of War FPS titles." Update: 01/27 06:34 GMT by Z : Update to the layoff article: "The first step is to rebalance the team. This has required us to let go 60 people -- from many different teams. There is no focus on any one team or any one class of individuals. It's a studio-wide thing to reset the business fundamentals and get the studio to the next level."
Team Balancing ACT 2005 (Score:5, Insightful)
After speaking to Neil Young, General Manager of the EA LA studio, it's now clear that the confirmed 60 layoffs are not heavily confined to one team or another, countering early rumors that the GoldenEye or Medal of Honor teams were specifically targerted -- countering the implication that the underperformance of certain games might have been the catalyst.
Maybe EA is shaking its developers up for the foreseeable battle with TakeTwo?
And it's undeniable that EA is in a good position to pull this kind of team-balancing stunt, because there are simply too many willing-to-work-25-hours-a-day multimedia graduates. If you come across an apple tree full of apples, you'll surely pick the best ones too.
Oh no! (Score:3, Insightful)
What's With the Obsession Over EA???!! (Score:1, Insightful)
I gotta say, this is definitely not front page news, and its certainly not stuff that matters to most people here. Please disengage this childish and silly crusade.
Goldeneye: Rogue Agent (Score:4, Insightful)
I'll say it right now (Score:5, Insightful)
I'm bitter about today's PC gaming.
You know (Score:5, Insightful)
But each time anyone attempts to emphasize the fact that business has turned its back on just about everything except its quarterly earnings, we get "nobody owes you a living so get over it."
The fact is, it is wrong to fire people like this. It is absolutely wrong. These companies are damaging, and in a lot of cases destroying the careers of people who work for a living. It isn't fair and it isn't right.
EA has no problem investing millions and tens of millions to build colossal glittering corporate edifices where they can hold meetings about whom to fire this week. But on payday they claim costs are too high.
W-4 employment is obsolete.
Re:Team Balancing ACT 2005 (Score:3, Insightful)
And then throw half of them in the trash? Oh, you mean they waited until after the game was done to realize these weren't the best candidates for the job? That's convenient. Why not just call it a temp job?
Anyone else say "screw em"? (Score:5, Insightful)
That being said, after reading all of the crap that EA has been putting their employees through, I refuse to buy a game from them anymore. The last sports game I bought was Tiger Woods Golf 2004 for my PS2, and that WILL be the last game I'll buy from EA. Period. I refuse to give my money to a company that gets away with the slave labor antics and rediculous headcutting that EA has graced us with. While all those 100-hour-a-week programmers get sent to unemployment, EA's CEO still gets his 7-figure salary and a fat bonus. And YES, I realize that my Old Navy jeans are made in China and my polo shirt was made in some third-world country. Exploitation goes on worldwide, and I've come to terms with it. This is just one battle that I choose to let affect my purchasing decisions.
So basically EA, fuck you. I'll take my $100 a year that I would have spent on your products and go to one of the two or three remaining competitors left in console gaming. Or maybe I'll go buy some basement-made games like Uplink instead. Or maybe I'll just say screw you all and go buy used NES games, which still entertain me way more than your 'Sports Title $YEAR' titles ever will. Either way EA, you can kiss my money goodbye.
Re:This is Not a Layoff (Score:4, Insightful)
They are making profits.
If they're talented, they'll find new employment.
So they can get fired again. I gotta ask: when do we get real jobs? Not bullshit temp work, but a REAL FUCKING JOB?
What's wrong with that?
Nothing, until their car gets reposessed and the bank forecloses on the house.
Nothing at all.
revolt against executives? (Score:3, Insightful)
They probably weren't right. But...
But it seems to me that perhaps a random lynching or two of scrooge-ish CEOs by angry ex-employees might deliver a potent message to any prospective pursuants of this squeeze-then-kill strategy. You know, make them think twice or somesuch...
Re:Oh no! (Score:3, Insightful)
I'd say that's pretty "evil"...
Re:If the game was bad (Score:2, Insightful)
Re:I'll say it right now (Score:5, Insightful)
I'm all in favour of a good rant now and then, and I think he did it well...
Re:Oh no! (Score:5, Insightful)
Of course EA is acting like a business. I am upset about people getting fired in all positions when their company is making profits not because this doesn't benefit the hierarchy within the corporation, this is logical for those at the top who value strength in the stock market as well as long term profits for themselves.
What sickens me is that we live in a world with an economic system where the most logical thing to do when your profits are up is to fire workers.
Just because something is logical for those doing it, does not inherently make it "normal" in the sense that human beings are naturally inclined to do it, nor does it make ethical.
I live about a mile from the offices (Score:4, Insightful)
Of course (Score:3, Insightful)
Re:Oh no! (Score:4, Insightful)
Re:You know (Score:2, Insightful)
No, but it is capitalism. The problem is that the people capitalism works for are the people that can afford to buy the laws that they want, which make sure that capitalism works for them and not ordinary people who can't afford to do the same thing because capitalism doesn't wrok for them, so they don't have the money blah blah blah.
As you pointed out, anyone that complains gets the old mantra of "nobody owes you a living", which ignores the fact that that is exactly the principle that the people at the top of the pile work under: they think we all owe them a living. Look at Gates: literally born a millionaire, he spends his life telling elected governments what to do. Why? What do they owe him and his aristocratic friends? "Bugger all" is the truth, but tell that to Bill and he'd have a hissy fit and fill his nappy.
I think we should take a leaf from the Israelis and just do random executions to keep the bastards in line.
TWW
Re:Oh no! (Score:2, Insightful)
You're completely missing the point, and probably have a really wrong-headed view of what makes an economy work, or at least what keeps people putting investment money into companies in the first place. EA wouldn't exist at all without its original and ongoing investors.
What you're not getting is that the only reason EA's profits grow is because they consistently (or often enough) make the hard descisions to drop (and add) people and resources wherever they think it will impact their bottom line in the right way. They're not right about every decision, but it's the overall approach that works. To assume a causal connection between their bump in profits (which shows up after months of activity and reporting thereon), and the more immediate tactical decision about their overhead and productivity in LA - that suggests a bit of myopia on your part about the scale of their operations, about business competition, about free markets in general, and about highly competitive frivalous industries (like video games) in particular.
The system you decry is the very one that allows us to have an entire industry dedicated to entertaining geeky game players. If it weren't for that system, those jobs never would have existed in the first place. Now that, not the ongoing fine tuning of it, would be sickening.
Re:This is Not a Layoff (Score:3, Insightful)
Losing your job is a fact of (American) life. It happens to almost everyone, maybe it's because someone in their family is sick and they need to move back home. Maybe it's because their spouse got a good job, and they had to move. Perhaps it's because they did a terrible job. It could even be because the company couldn't afford them.
If they are talented, they will get work again. If not, then maybe they don't belong in their current field?
You might ask, "Well if only the really good people get employed, then what are we to do?". There are thousands of thousands of average companies that hire average employees to do average jobs.
If their car got reposessed and their house foreclosed, whos fault is that? It behooves a person to ensure he/she can afford an item they own, be it a car, house, motorcycle or television. Some (most?) of us have learned that the hard way with credit card debt. Save up 6 months worth of the payments, then purchase the item. Live below your means, don't overbuy a house/car.
Too many of my friends are house-rich, but can't afford gas for their SUVs. Do I feel empathy? Yes. Do I feel pity? Hell no. They made the dang choice.
Yes. And that's the point. (Score:3, Insightful)
If companies have the rights of people, why shouldn't I expect them to behave as I am expected to? Perhaps that's the point - companies and their investors get the benefits of an entity with the rights of a person and which is exempt from the responsibilities that that person would have. You can't eat the seed corn and expect there to be a harvest next fall, but hey that corn tastes good, doesn't it?
This sense of fairness is amplified by the nearness many people here might have towards the employees. The people getting fired could be them, after all - people who like their work but don't feel like getting squeezed when times are good and screwed when times are bad. And all along, those that made the good/bad decisions for which they paid walk away with their pockets full.
This is just business as usual. I guess it's too much to hope for that the usual wouldn't suck so badly.
Re:Team Balancing ACT 2005 (Score:4, Insightful)
It's a video game company for christ's sake. (Score:2, Insightful)
Re:What's With the Obsession Over EA???!! (Score:5, Insightful)
As far as your comment that this is "certainly not stuff that matters to most people here," this is, in fact, important to a lot of people here. This is news that actually affects people. It's certainly much more significant than "Oregon's Governor Backs Open Source Development" or "Running Windows Viruses Under Linux" as I'm sure the number of people who live in Oregon or the number of people who want to run Windows viruses under Linux is much lower than the number of gamers in the world.
It was all I could manage not to mod you down, as I seriously don't think something so uninformed should be modded +5. However, I really don't like to mod people down, so I'm saving my points to mod up more worthwhile comments.
Re:What's With the Obsession Over EA???!! (Score:3, Insightful)
So exactly what company in America do you buy from that has never laid off people?
Tool of the media (Score:4, Insightful)
I don't want to have to defend EA here, but do we really know if they're worse than the rest of the industry? I'd never work for a company like that, but let's remember that this whole thing started from the blog of a wife of an EA programmer. Now we have slashdot posting everything they do. I'm not saying they *aren't* the antichrist, but let's actually consider first whether there's some manipulation or just plain shoddy reporting at fault too.
Re:This is Not a Layoff (Score:5, Insightful)
Fine. Then say so. Don't tell people "work hard, get an education and get a good job." Tell people the American dream is "they'll fire your ass."
If not, then maybe they don't belong in their current field?
And who makes that decision? Oh, the same people who just got through firing several dozen employees? Yeah. No problem there.
There are thousands of thousands of average companies that hire average employees to do average jobs.
But I thought they had to be talented?
If their car got reposessed and their house foreclosed, whos fault is that?
Hey, they showed up and did their job. They held up THEIR END OF THE BARGAIN.
It behooves a person to ensure he/she can afford an item they own, be it a car, house, motorcycle or television.
That's why they worked their ass off to get a good job.
Re:I'll say it right now (Score:5, Insightful)
Re:Oh no! (Score:4, Insightful)
Thats why people hate EA, they are putting people out of work just for the rights to videogames.
Take your company public, EA could buy it out from you, and own everything you work for.
Thought experiment. (Score:3, Insightful)
One has 100% "original and ongoing investors" and no workers.
The other has 100% workers and no "original and ongoing investors".
Which has a chance of succeeding?
I ask this question to point out that the workers are very important to a company's operations. Moreso than the investors. ( note, investment is good, yada yada, etc, etc. but put it in perspective, workers *and* investors make the economy work ). EA also would not exist without it's workers.
Re:This is Not a Layoff (Score:1, Insightful)
And they were compensated for it. What, is it a crime not to pay $1M for someone to do some graphics work?
If the employees were promised something that the company reneged on, then I would feel empathy. As such, they know employment in the game industry is risky. Next time maybe they'll get some severence clause in their contract.
Re:Oh no! (Score:5, Insightful)
And that, right there, is the big problem that causes so many people to complain about big corporations: They have come to favour short term quarterly profits over long term sustainable profits. If you look at most complaints, from environmental, to labour, to political, when you pare it down it is occuring because companies are considering their short term future but not bothering to look at the long term results.
Jedidiah.
Re:Anyone else say "screw em"? (Score:3, Insightful)
I'd rather see people stop buying EA PC games because frankly, the overall quality of them just sucks. It took Battlefield 1942 around a years worth of patches before it hit what I would have called "release quality". Battlefield Vietnam, built on basically the same engine, was released on an EARLIER VERSION of the engine, missing many of the key features that BF1942 had - and these didn't get added in until subsequent patches several months later.
Medal of Honor: Pacific Assault was practically unplayable for many people online - I think this was fixed in a recent patch, but this game was dead online from day one and shows no signs of resurfacing - a shame as MOH:AA was quite popular online and still has a fairly avid following.
Typical (Score:2, Insightful)
Re:This is Not a Layoff (Score:1, Insightful)
Does it seem to anyone else like being productive is a bad move in this country? If you learn a trade and work your ass off every day, you are just another laborer. If you learn advanced skills and create things that have never been done before, you are just a higher priced laborer to be dropped at the first bad quarter. On the other hand, if you can spout bullshit with a straight face, then you get paid to hire and fire the labor, and you get bonuses for it. Best of all, if you do nothing but move money back and forth, taking a cut each time but never contributing a dime to the GDP, you're going to retire filthy rich at the ripe old age of 40.
The worst move I ever made was to decide to pull my own weight.
Re:I live about a mile from the offices (Score:4, Insightful)
Nothing beats a reliable paycheck unless it's a reliable paycheck in a healthy work environment. A good boss is one that lets you get out after you've put in your honest day's work, and also treats you well. The overlords make all the difference.
Re:This is Not a Layoff (Score:3, Insightful)
LOL. Sorry, I left that $200,000 I'd saved up in my other pants. Can you spot me?
It's certainly easy to play armchair quarterback when you're not the one in trouble or don't know those who are. I knew plenty of extremely well qualified individuals who lost their job during the last bubble burst, and some of them still haven't found a reasonable paying job. The saturation of H1B's, outsourcing, and general lessening of the IT job pool has caused serious problems in a lot of communities - and a lot of people who were told to go to college, get a good degree, work 80 hours a week and they'd get ahead instead got the shaft.
I'll just throw out this particular stat: In 1970 the top 100 CEO's made ~39x the pay of an average worker; Today, they make over 1,000x the pay.
You blame "personal accountability" or "living within your means" if you like. I'll call it the plundering of middle-america so fatassed CEO's can light their cigars with hundred-dollar bills.
labor (Score:1, Insightful)
Re:This is Not a Layoff (Score:5, Insightful)
This comes down to whether they were on contract to do just that job or whether they were full time employees. Before you say "sure sure, thats just being pedantic" hear me out
If they were contracted to do just that job, then they would have expected to be paid for a short term job ie. a higher pay than a permanent employee. If they were a full time employee, then part of the bargain of the employee accepting lower pay than the contractor is the implication made by the company that by accepting the lower pay there is greater job security.
I guess what Im getting at is that if a company does not want employees on for long periods, then it should not offer permanency to staff. If it does offer permanency with the knowledge that it plans to downsize the employee in the forseeable future then it is being dishonest as it is promising permanency only with the view to reduce how much it has to pay.
Dont want permanent employees - only hire contractors. That way both sides know what to expect from the arrangement.
What? (Score:2, Insightful)
Rebalance the team, reset the business fundamentals, next level... what is this guy actually saying? This roughly translates to "firing 60 random scapegoats to safe managements' ass for leading the studio in the wrong direction".
Re:This is Not a Layoff (Score:3, Insightful)
They are not a charity organization. If they identify employees who are not pulling their weight, they are not obligated to keep them, just because the company happens to be in the black. It is every employees' responsibility to continuously prove their worth, to generate value for the company.
So they can get fired again. I gotta ask: when do we get real jobs?
Why don't you start by taking responsibility for your own career? If you don't like being at the whim of those who employ you, then employ yourself. Go into business for yourself. Contract out your services. Quit complaining that these people owe you an ongoing free handout, just because you may have made them some money a few years ago.
Nothing, until their car gets reposessed and the bank forecloses on the house.
Boo-freakin-hoo. Maybe they shouldn't have overextended themselves, living beyond their means an on eggshell-bed of credit that will inevitably collapse. Sure, living beyond your means "is the American way," well that won't fly. You're supposed to be smarter than average, and should know better than to borrow so much money that missing a couple paychecks will send you into foreclosure.
Re:Team Balancing ACT 2005 (Score:4, Insightful)
Well, this seems to be what the industry is moving towards, and it's honestly not such a bad thing.
The film industry and in fact most creative industries operate on a project-to-project basis. You're hired for a specific project, you work like mad for six months, you make a year's worth of money during that time and then you're done. You then shop yourself around to other producers and try to get yourself attached to another project. Or, you take six months off and recharge.
This makes most creative industries pretty cut-throat, but it has a couple of positive effects. First, it keeps creative professionals from being too overworked, which as we all know is a huge problem in the games industry. Right now, the industry operates like a project-based industry but with permanent employees, so the workers don't ever get that break when projects end. Second, it hopefully causes the cream of the crop to rise to the top, because it's sort of a Darwinian system. The strong survive, the weak can't get themselves attached to new projects and eventually find other work. Of course, it doesn't always work out that way in any creative industry - the most creative minds are not always great at networking, for one thing. But it does ensure at least a basic level of competence in the industry, which right now is lacking (I think we can all agree that the technical quality of games these days is really all over the map).
If there really is a transition within the industry to become more like the film or other similar industries, then once it's complete I think workers will actually be better off. There will still be permanent workers and plenty of them, but, like the film industry, they will mainly be in marketing and administrative positions, which are often (though not always) both lower stress and higher paying than development or production jobs are today. The pay per project of developers will actually go up, because there will be an actual incentive for developers to recruit top talent for top projects, and the number of total hours worked per year for developers will go down - unless someone's a real coding rock star who's in high demand and chooses to simply move straight on from one tough project to the next.
Again, plenty of industries already work like this and it makes more sense than asking poorly-paid, often untalented full-time employees for 24/7 devotion to the company. Weed the untalented out of the industry, pay the talented better and give them some more time off. If they've got the talent and some basic interview skills, they'll have no problem finding more work in such a system.