After months of speculation, EA confirmed yesterday that it's completed a buyout of social gaming giant Playfish, the developer behind popular titles such as Restaurant City, Who Has the Biggest Brain, Pet Society and Country Story.
Playfish has an install base of over 60 million players across Myspace, Google, Facebook and iPhone, prompting a buyout deal of $275 million coupled with $25 million in equity retention agreements. A further $100 million could also be made available depending on how the Playfish brands meet performance milestones between now and the end of 2011.
"Social gaming, with its emphasis on friends and community, is seeing tremendous growth and this is the right time to invest to strengthen our participation in this space," says Barry Cottle, Senior Vice President of EA Interactive.
"EAi has been successfully leading the charge for EA, and with the addition of proven expertise from Playfish, their broad consumer base and strong game brands, we're moving ahead aggressively in our plans to lead in the category of cross-platform social entertainment."
While this move clearly demonstrates EA's commitment to the social age of casual gaming, it's landing criticism elsewhere for not showing the same commitment to its staff.
Only hours after the Playfish announcement, the gaming giant gutted its workforce at several key EA locations. In total, 1,500 lay offs will be made by next March, consisting of 900 in game development, 500 in publishing and 100 from management in an effort to save $100 million per annum.
"Laying off employees and closing facilities is never pleasant," CEO John Riccitiello said during an EA conference call. "We have a lot of compassion for those impacted but these cuts are essential for transforming our company. Our operating expenses will be reduced by at least $100 million compared to our current run rate."
The axed jobs take 12 in-development projects with them down the pan, while the company also suggested it will be reducing its portfolio to only the most profitable franchises.
Evidently these savings are coming through nicely, having paid for - and tainted - the acquisition of Playfish.
News
Related Articles
Top Stories
News
Apr 18th, 2024
Fortis team boosted by top ex-King, PopCap EA, Microsoft and Warner Bros. Games talent
News
Apr 18th, 2024
UK skills crisis prompts call for games industry-led body to tackle key challenges
News
Apr 18th, 2024
AI joins the team at King: "Our challenge is to create the right amount of challenge"
Feature
47 minutes ago
Chart Climbers: Brawl Stars, Legend of Mushroom, Sea of Conquest and more rise up the mobile game revenue rankings
News
Apr 17th, 2024
Monopoly GO! celebrates its first birthday and shares its behind-the-scenes story
Feature
Apr 15th, 2024
46 top mobile games in soft launch: CSR 3, Plants vs. Zombies 3, LEGO Hill Climb Adventures, Candy Crush Blast, and more
Events
HIT Games Conference Istanbul 2024 | Apr 18th | |
Game Job Fair – Spring Edition 2024 | Nordic | Apr 18th |
Arts DAO Fest 2.0 | Middle East | Apr 20th |
App Promotion Summit London | Europe | Apr 25th |
Esports Future Summit | Middle East | Apr 27th |
Dubai GameExpo Summit 2024 | Middle East | May 1st |
The MENA Games Industry Awards 2024 | Middle East | May 2nd |
GameDev Atlantic 2024 | May 4th |