Pulse2 Technology and Social Media News » EA

EA Denies 500-1,000 Employee Layoff Rumor

Amit Chowdhry — Mon, 16 Apr 2012 16:40:14 +0000

Electronics Arts has denied a report that says around 500-1,000 people will be laid off. This would have represented 5-10% of their workforce. StartupGrind.com wrote about the layoff rumor, but they were given an official statement from the company that said “There are no lay-offs as such, we always have projects growing and morphing.” They added “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.” EA is also looking to hire hundreds of people for the digital, console, mobile, and social games divisions.

Star Wars: The Old Republic Is EA’s Most Expensive Game

Amit Chowdhry — Wed, 21 Dec 2011 20:30:54 +0000

Star Wars: The Old Republic is Electronic Arts’ most expensive game put together in their 30-year history. The game features Jedis, Wookies, and Siths that are just like the characters in the popular movie series. It is believed that EA put in between $100 and $300 million into this game, but EA has not spilled any information on costs that are associated with development and licensing.

The cost of the gamer is $60 up front. To play it as an multiplayer online game, it is believed to cost about $15 per month. EA spent about three and a half years building the game to go directly after Activision Blizzard’s World of Warcraft (WoW). WoW generates about $1 billion in revenue. To build the game, EA hired about 1,000 voice actors for the game, which has broken an industry record.

The game needs about 500,000 subscribers to break even on the game. The game was developed by about 400 full-time EA employees.

[Huffington Post]

EA Buys KlickNation For About $35 Million

Amit Chowdhry — Fri, 02 Dec 2011 21:47:26 +0000

Electronic Arts Inc. (NASDAQ:ERTS) has acquired social gaming company KlickNation. KlickNation’s team will be rolled into EA’s BioWare social gaming division. KlickNation will focus on role-playing Facebook app games and the team will continue to be led by CEO Mark Otero.

According to sources with InsideSocialGames, EA bought the company for roughly $35 million including earn-outs and retention bonuses. It is unlikely that KlickNation’s games will be cut off even though they have been slipping in traffic over the past month. KlickNation’s biggest competitor, Zynga, is preparing for an IPO at a market valuation that would make them almost as large as Electronic Arts themselves.

EA Acquires PopCap After Zynga Offered $1 Billion

Amit Chowdhry — Mon, 18 Jul 2011 03:18:59 +0000

Electronic Arts Inc. (NASDAQ:ERTS) has bought PopCap Games, an online gaming company. EA spent $650 million in cash and $100 million in stock. PopCap is also eligible to receive $550 million in earnouts over the next couple of years. EA out-bid Zynga for the deal. Zynga reportedly offered PopCap $1 billion.

PopCap shareholders will not receive anything in earnouts if the company earns $91 million or less in EBIT through December 2013. If PopCap hits $343 million or more during that same period, then shareholders can make $550 million in earnouts.

PopCap started in 2000 and currently has 400 employees. The company’s headquarters are in Seattle, Washington.

[CNET]

Zynga Hires John Schappert Away From Electronic Arts’ COO Position

Amit Chowdhry — Tue, 26 Apr 2011 19:05:14 +0000

Electronic Arts Inc. (NASDAQ:ERTS) just saw their chief operating officer John Schappert get hired away by social gaming Zynga. Zynga’s rivalry is intensifying as their internal valuation surpassed EA’s around October 2010. Ironically, about a year ago Schappert said at a conference that the future of gaming is acquired franchises like The Sims and Madden. [BusinessInsider]

Activision Suing EA For $400 Million

Amit Chowdhry — Thu, 23 Dec 2010 18:21:43 +0000

Activision has added Electronic Arts Inc. (NASDAQ:ERTS) to a $400 million lawsuit. Activision fired Jason West and Vince Zampella this past March. Activision believes that EA had “intentionally interfere with contracts, engaged in unfair competition and aided and abetted breaches of fiduciary duty by the executives.” Apparently EA was talking to West and Zampella through talent agency Creative Artists before the two finished working on Modern Warfare 2.

Facebook Credits To Become Exclusive Payment For EA Games On Facebook

Amit Chowdhry — Tue, 02 Nov 2010 21:02:25 +0000

Electronic Arts Inc. (NASDAQ:ERTS) has signed a 5 year agreement with Facebook. The deal will require those who purchase EA games on Facebook to pay with Facebook Credits only. This deal is very similar to the deal that Zynga signed with Facebook. EA is the parent company of Playfish, a social gaming company that competes directly with Zynga.

Facebook and EA will split the revenues on a 70-30 basis with 70% going to EA. Playfish creates social games for Facebook, Hi5, and MySpace. Playfish has created popular game applications such as Pet Society and Restaurant City.

[TechCrunch]

Zynga’s Valuation Hits $5.51 Billion On SharesPost

Amit Chowdhry — Tue, 26 Oct 2010 18:25:30 +0000

Social gaming company Zynga has hit a $5.51 billion valuation on SharesPost Inc. Given this valuation, it means that Zynga is essentially worth more than Electronic Arts. Electronic Arts is worth about $5.16 billion on the stock market.

Zynga was started by Mark Pincus about four years ago and they make money by selling virtual goods. Zynga has about a 30% market share for Facebook game applications.

EA has seen a decline in retail sales because people are starting to prefer playing games on social networks instead of buying shrink-wrapped games. Zynga has about 210 million monthly active users and they have raised $350 million in venture capital. Zynga has acquired six companies since this past May and they have about 1,200 employees.

Zynga’s valuation in March on SharesPost was $2.61 billion. This means that the valuation more than doubled in 7 months.

[BusinessWeek]

Chillingo Acquired For $20 Million By EA [UPDATED]

Amit Chowdhry — Wed, 20 Oct 2010 20:35:39 +0000

Electronic Arts Inc. (NASDAQ:ERTS) has acquired Chillingo, the gaming company that developed Angry Birds. The acquisition was made for about $20 million in cash according to a source with Reuters. Angry Birds was one of the fastest selling games on the Apple App Store and they recently released the game for Android free of charge. By releasing the game for free on Android, they saw about 2 million downloads in 3 days. “By acquiring Chillingo, EA Mobile is increasing its market leadership on the Apple Platform as well as reaffirming its position as the world’s leading wireless entertainment publisher,” stated a spokesperson for EA.

Chillingo followed up Angry Birds with a game called Cut the Rope. Cut the Rope sold one million copies in only 10 days. However Chillingo does not own the intellectual property behind both Angry Birds or Cut the Rope. Angry Birds is owned by Rovio and Cut the Rope is owned by ZeptoLab. There will be further details about what will happen to these two franchises tomorrow.

Update: Rovio Mobile said that they have not sold out. Chillingo is just a publisher. The acquisition has no impact on Rovio whatsoever.

[Mashable]

40 Current and Former Infinity Ward Developers Suing Activision For $500 Million

Amit Chowdhry — Wed, 28 Apr 2010 17:35:21 +0000

About 40 past and current Infinity Ward developers are suing the company because of breach of contract and unpaid royalties for the game Call of Duty: Modern Warfare 2. The class action lawsuit seeks $500 million from Activision’s Infinity Ward over unpaid bonuses, profit sharing, punitive damages and future profits from future games including Modern Warfare 3. The payments were withheld to prevent employees from leaving Activision.

“In short, Activision withheld the property of the IWEG in an attempt to keep the employees hostage so that Activision could reap the benefit of the completion of Modern Warfare 3, ” stated a document filed for the lawsuit. Jason West and Vince Zampella are two of the people behind the lawsuit. The two filed a lawsuit against Activision and is seeking $36 million in unpaid royalties. West and Zampella started a gaming studio of their own called Respawn Entertainment and even signed a deal with Electronic Arts already. [Kotaku]