Riccitiello Says Investors Don't Care About Quality

[Andy Chalk]

Riccitiello Says Investors Don't Care About Quality

Electronic Arts [http://www.ea.com] CEO John Riccitiello says that while EA is working hard to improve the quality of its games, investors don't particularly care about that.

"I don't think the investors give a shit about our quality," Riccitiello admitted during a lengthy interview with VentureBeat [http://venturebeat.com/2008/07/21/e3-perspective-an-interview-with-john-riccitiello-ceo-of-electronic-arts/]. "They care about our earnings per share. They wait for it to happen. We had three years where we didn't make our expectations. If I were an investor, I would wait and see. That's fine with me."

Touching on the acquisitions of Saboteur [http://www.bioware.com] in the works. We've got Mass Effect 2 coming. Some of it is 2009 software. If you're stuck on the fact that the stock is at $45, I can't really help you."

Riccitiello also expressed amusement at the industry's near-obsession with EA's ongoing efforts to acquire Take-Two Interactive [http://www.take2games.com/], a story which has been largely static since it began. "There have basically been three moves and there have been 6000 articles on it. It's sort of amusing," he said. "I feel a little bit like those strobe light things were it looks like a guy is moving a lot. The flash goes off but the body doesn't move. Every time a flash goes off, somebody writes a story on it. To be honest with you, the last time there was news was a couple months ago."

VentureBeat's full Q&A with EA chief John Riccitiello can be read here [http://venturebeat.com/2008/07/21/e3-perspective-an-interview-with-john-riccitiello-ceo-of-electronic-arts/].


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[PedroSteckecilo]

He's kinda right, most investors are just douchebags with money who provide money in hopes that they will make more money eventually.

 

[Bretty]

He's kinda right, most investors are just douchebags with money who provide money in hopes that they will make more money eventually.

LOL, thats about the basics covered.

EA has one of the worst EPS (Earnings per share) I have ever seen. But I have invested in the company because I feel that with such big titles being released (and hopefully being successes (WAR, Spore)) they will do even better and hopefully show a possitive EPS.

But yeah an investor looks at the money, a customer looks at the quality. If you dont have customers you dont sell games and you dont hit your financial objectives, which upsets the share holders. I think he over simplified things because these are always linked.

 

[sammyfreak]

He's kinda right, most investors are just douchebags with money who provide money in hopes that they will make more money eventually.

I don't really think that calling them douchebags is fair, good investors tend to realise that treating a company well is the best way to profit in the long run.

 

[smallharmlesskitten]

This explains a lot.

I bet every developer they use is just a machine that churns out the same game every year

{see zp}

 

[calelogan]

From what I understand...profiting is not necessarily the same as working on quality games for consumers. If both objectives go hand in hand, that's excellent and quite ideal; but from what I've seen it is possible to profit without making great games and that's probably where many investors fit it. If they get their share, they're happy, even if they have no idea of what's being made for the gamers.

 

[Bretty]

But you just have to look at Flagship Studios for an example of what happens when you release an unfinished game. Sure you get money to begin with, but then what?

You can only release so many bad games. Or get a cult following and release as many as you want. But you get my point.

 

[stompy]

That explains why they release every series every year... Yeh, I kinda figured this out ages ago. Investors want money, and releasing games as soon as possible, without any real content, helps them get money, so that's what they do.

 

[Joeshie]

Investors don't care about the final product, only what nets them the most profit. If releasing a shitty game nets you one extra cent profit compared to releasing a great game that loses you one extra cent profit, you can bet your ass investors will go with releasing the shitty game every day of the week.

 

[Miral]

This is why crappy games get released instead of simply being shoved in the bin. There'll always be someone who will buy it, and they need to recoup at least some of the costs involved in building it. But yeah, if it happens too much then less profit / more loss will be made, which will lower the earnings per share. Which will eventually scare off the investors. It's just a longer cycle.