Former EA Exec Blasts Current EA Execs for Incompetence

[John Funk]

Former EA Exec Blasts Current EA Execs for Incompetence

Former EA mobile VP Mitch Lasky has added to the criticism at the John Riccitiello-helmed Electronic Arts, saying that the publisher "is in the wrong business."

It's not a good week to be leadership at Electronic Arts. First, heavily criticized [http://www.escapistmagazine.com/news/view/97404-EA-Comeback-Taking-Longer-Than-Expected] CEO John Riccitiello's performance leading the company, pointing to the publisher's slide in stock value since he took control.

Now, a former EA executive is backing them up - Mitch Lasky had been one of the men at the helm of EA Mobile, the cell-phone-games division, before departing the company for greener pastures. In a scathing post to his blog [http://bizpunk.blogspot.com/2010/01/after-bell-today-ea-announced-massive.html], Lasky lambasted the EA Games label for churning out unsuccessful, expensive titles, blaming it all on the failure of the company's leadership to adapt.

"EA is in the wrong business, with the wrong cost structure and the wrong team, but somehow they seem to think that it is going to be a smooth, two-year transition from packaged goods to digital. Think again," wrote Lasky. "EA's sports business has been hamstrung by vastly increased licensing costs and failure to transition to a subscription/variable pricing model. This has substantially reduced the profitability of a business that EA used to rely on to fund other, riskier bets."

Interestingly enough, one of Riccitiello's greatest failures (according to Lasky) has been something applauded by gamers and journalists alike - the man's focus on creating new IPs in order to grow the company has been risky and ultimately unfruitful, claimed Lasky, underscoring the statement with a belief that Dante's Inferno (I don't think that really counts as a "new IP?") and The Old Republic (for that matter, I don't think that one does either) would be failures.

"It's been a very ugly scene, indeed. From Dante's Inferno [http://www.amazon.com/Spore-Mac/dp/B000FKBCX4/ref=sr_1_1?s=videogames&ie=UTF8&qid=1280862653&sr=1-1], or Knights of the Old Republic (sic), is going to make it all better. It's a bankrupt strategy."

As much as I hate to admit it, the facts do seem to be on Lasky's side. For all the good that new IPs bring the industry, sequels are by far the most lucrative way to go in the business, and sequel-and-franchise-focused rival Activision has been laughing all the way to the bank for just that reason.

Are the days of the "new EA" numbered? For all we can brush off Lasky's accusations and applaud a major publisher for promoting new IPs and (relative) innovation, it's EA's investors that ultimately have their say - and at the end of the day, a title that doesn't sell is a title that investors won't back.

(Via GI.biz [http://www.gamesindustry.biz/articles/lasky-ea-is-in-the-wrong-business])

Permalink

 

[Onyx Oblivion]

You see? More people need to buy new IPs and then they won't be "commercial disappointments".

I'm still happy that I paid 60 USD for Mirror's Edge.

 

[sgtshock]

So this Mitch Lasky guy is saying that their financial troubles are the result of their recycled sports games not selling like wildfire like they used to?

Funny to think that those shitty games are what financially allowed games like Mirror's Edge and Dead Space to exist. Of course, it looks like that'll change now.

 

[Avatar Roku]

You see? More people need to buy new IPs and then they won't be "commercial disappointments".

I'm still happy that I paid 60 USD for Mirror's Edge.

Agreed. I don't get why people disliked it, but even if I disliked it, I'd have been glad that I bought it just because it's a new IP, and helping new IPs, even ones we don't like, means that it will lead to other new IPs.

 

[theaceplaya]

I guess public image doesn't count for anything anymore. Sounds like 'We don't care about the growth of the medium, as long as we get more money than we did last year. Economy be damned."

 

[Booze Zombie]

If people were not morons, they'd be buying all these new IPs instead of buying rehashed crap.
Not to say that sequels are inherently bad, but new IPs can be nice, too.

 

[Therumancer]

I think it's too early to say anything. The economy isn't in great shape, and ultimatly we're looking at a long term strategy. It wasn't THAT long ago that we were crticizing EA for not doing anything new. Sure the new strategy hasn't immediatly produce fruit, but I think only a fool would assume it was going to. I still suspect that in the long run EA is going to do better with their current directiont han the old one.

Besides, I honestly don't think EA is losing money to be honest.

The one criticism I'll agree with though is the bit about a "smooth transition to digitally based content". I plan to fight that heavily, and I agree it's not likely to happen within two years. Right now I think discs and used games is the model to follow, and honestly I have yet to see ANYTHING that makes me want to give up those rights and become totally dependant on DLing from a company. With the exception of Valve's periodic sales, I rarely if ever see a digitally downloaded game (brand new) going for LESS than a store bought one despite all of the money allegedly being saved on packaging and such (they just keep that as profit). Even when dealing with lower prices, I see no real guarantee that we aren't dealing with a "Wal Mart" ploy. I mean let's say a service like say STEAM did drive disc based games out of business by say reducing all prices by 90% and keeping them there for 5 years or whatever. In the end, what would be stopping the service from raising prices again once they competition was gone?

 

[Jared]

THey are getting a real hammering. Seems like all cannons are against them at the moment.

 

[Jonny49]

Well...at least there's Battlefield.

 

[lumenadducere]

Wasn't the whole reason behind the "new EA" the fact that their old strategy was beginning to no longer work? EA Sports games were no longer selling as well and the bad rap that EA had gotten was beginning to harm sales. Someone please correct me if I'm wrong, but that's what I had heard. With Activision doing what EA was, they're going to be facing the same issue. Not for another ten years or so, but eventually it's going to catch up with them as well.

I do wish that gamers in general would support lesser-known and riskier IPs, but I get the feeling that the vast majority of people who play games don't pay any attention to gaming news and thus don't know about them. We should be supporting games like Mirror's Edge and Dead Space but instead what sells are formulaic cookie-cutter games. It makes me kind of sad, really.

 

[The Rockerfly]

I call jealous *seriously hopes I don't get ninja'ed

 

[Crunchy English]

Bah! This guy doesn't know what he's on about. EA will be fine. The closing of Pandemic was likely a mistake, granted, and there's been mistakes made. But MMO's basically print money if you can hook a devoted fanbase, so TOR should be a big deal. And honestly, I'm going to support EA in a way I would have previously thought impossible.

Let's kick up the negative wish fulfillment.

Dear Gaming Deities, O Swift, Terrible, and Sometimes Predictable Winds of the Market,

Please let the following be so.

Please let Modern Warfare 3 fail miserably, just to reassure Activision, and indeed all gaming corporate types, that they have no idea what the hell they're doing and they do need creative artists at the helm.

Please let WoW be shut down due to legal reasons beyond Blizzard's control, there by letting other online communities flourish and freeing thousands of brainless zombies from their technological stasis.

Please let Madden 2011 take a huge risk and plant the NFL license in the middle of a giant action/adventure platformer. Even though they tricked most people into buying with a bland cover, the game will then be a giant financial hit and a critical darling. EA now has permission to do whatever crazy ass thing they want with the genre.

 

[hansari]

So this Mitch Lasky guy is saying that their financial troubles are the result of their recycled sports games not selling like wildfire like they used to?

I like how people glance rather than read an article.

The failure wasn't in the units sold, thats always been up and down with the Madden series. The failure was that they haven't got a handle on the NFL squeezing more and more money out of them for licensing rights. The failure was that they still haven't turned the franchise into something subscription based and are still focusing on physical media...

I guess public image doesn't count for anything anymore. Sounds like 'We don't care about the growth of the medium, as long as we get more money than we did last year. Economy be damned."

Really? I thought it was more like "Appeasing Gamers is pointless. They demand innovation, but would rather buy a title that offers nothing new."

MW2 probably made more money than all those other ip's mentioned in this article...combined...

Thats sad...and there is no one else to blame but the gaming community.

I played Dead Space and Mirrors Edge...they weren't blockbuster "must haves"...but after playing MW2...can you really say thats a "must have"? At least the EA titles offered something a bit new...

Besides, I honestly don't think EA is losing money to be honest.

Yeah, I'm sure their just laying people off and closing studios for shits and giggles.

 

[samsonguy920]

I doubt Riccitello is going to worry about this guy, considering what Lasky worked on when he was working. Anybody can drag up numbers and call it whatever they want. Mass Effect 2 is going to sell like hotcakes, TOR might start off slow but I'm just about betting that is going to pick up to be a hot number.
Lasky, it's good that you are concerned about the company you worked for, but you should let it go, and focus on your current job. If you have one.

 

[Sillyiggy]

"It's not a good week to be leadership at Electronic Arts."

Good thing they will still make tens of millions. That's a lot of 100's to wipe them tears.

 

[wasalp]

-snip-

The one criticism I'll agree with though is the bit about a "smooth transition to digitally based content". I plan to fight that heavily, and I agree it's not likely to happen within two years. Right now I think discs and used games is the model to follow, and honestly I have yet to see ANYTHING that makes me want to give up those rights and become totally dependant on DLing from a company. With the exception of Valve's periodic sales, I rarely if ever see a digitally downloaded game (brand new) going for LESS than a store bought one despite all of the money allegedly being saved on packaging and such (they just keep that as profit). Even when dealing with lower prices, I see no real guarantee that we aren't dealing with a "Wal Mart" ploy. I mean let's say a service like say STEAM did drive disc based games out of business by say reducing all prices by 90% and keeping them there for 5 years or whatever. In the end, what would be stopping the service from raising prices again once they competition was gone?

Because valve(and steam) isn't run by ass holes.

 

[Nurb]

"EA is in the wrong business, with the wrong cost structure and the wrong team, but somehow they seem to think that it is going to be a smooth, two-year transition from packaged goods to digital. Think again," wrote Lasky. "EA's sports business has been hamstrung by vastly increased licensing costs and failure to transition to a subscription/variable pricing model. This has substantially reduced the profitability of a business that EA used to rely on to fund other, riskier bets."

This man is an idiot... he's cirticizing new management because of sliding stock prices, not because of their conduct [http://www.escapistmagazine.com/articles/view/columns/experienced-points/6991-Experienced-Points-Now-That-Youre-Done-Firing-Everyone], mediocre games, or lack of originality and creativey.

No gamer wants subscription or tiered pricing plans for single player/multiplayer non-MMO games, and they're going to shoot themselves in the foot if they do what the old exec says. They have no interest in the games beyond a 'sure bet' to make their quarterly reports to keep investors happy. Corporate business practices and strategies do not mix with what gamers want and enjoy. Instead they take more and more control away from the gamers (eliminating used game market, day-one DLC, fewer multiplayer options, moving towards full-digital marketplace, lack of dedicated servers, planning subscription based non-mmo games) and the industry has been suffering for it ever since the publishing giants squashed most of the competition or bought them out.

 

[Chaos Marine]

Wow, I never thought I'd feel any remorse for Riccitiello. Ever.

 

[Therumancer]

So this Mitch Lasky guy is saying that their financial troubles are the result of their recycled sports games not selling like wildfire like they used to?

I like how people glance rather than read an article.

The failure wasn't in the units sold, thats always been up and down with the Madden series. The failure was that they haven't got a handle on the NFL squeezing more and more money out of them for licensing rights. The failure was that they still haven't turned the franchise into something subscription based and are still focusing on physical media...

I guess public image doesn't count for anything anymore. Sounds like 'We don't care about the growth of the medium, as long as we get more money than we did last year. Economy be damned."

Really? I thought it was more like "Appeasing Gamers is pointless. They demand innovation, but would rather buy a title that offers nothing new."

MW2 probably made more money than all those other ip's mentioned in this article...combined...

Thats sad...and there is no one else to blame but the gaming community.

I played Dead Space and Mirrors Edge...they weren't blockbuster "must haves"...but after playing MW2...can you really say thats a "must have"? At least the EA titles offered something a bit new...

Besides, I honestly don't think EA is losing money to be honest.

Yeah, I'm sure their just laying people off and closing studios for shits and giggles.

It's called "Downsizing" crying poverty is one way of trying to justify it, and work around the laws and such put into place to protect workers in certain areas. The basic idea is that the less people they have to pay at any given time, the more money they make as profits. On top of this they want to pay the people they have as little as possible, and try and get the highest quality people for the lowest amount of seniority/benefits/etc... that they can.

I'm sure they have reasons for it, but not the ones that they claim. After all as someone pointed out they just bought "Playfish". Why would they hire all those people while firing others? Well the "Playfish" guys are doubtlessly coming in as new hires, while their previous employees had doubtlessly achieved some seniority. Without looking at the pay rate and benefits on both sides it's hard to really make a guess, but the evidence shows they certainly aren't in any kind of genuine financial jeopardy.

I think the move is more about maximizing profits than trying to keep their head above water.

Think of it this way, those EA guys who were let go have experience. They will doubtlessly sign with another company who needs experienced people for a project. When that project is done there will be some excuse to lay them off again, they will go back into the pool and be picked up by yet another company, maybe one they already worked for.

The concept of a talent pool everyone in an industry "fishes" from is currently becoming popular. The idea being that you don't actually lose any talent or experience, while not having to actually care for those people, provide long term benefits, or worry about accrued seniority, retirement, etc... it's in all kinds of industries right now. It's a way of dealing with the whole issue of the "need" for skilled employees and labour while keeping the price of those guys down. Game industry workers don't have a union to my knowleged (if they did we'd be hearing about nasty fights over layoffs like this while a company is buying anothr company at the same time) so they are getting "pooled" like other industries with skilled non-union workers.

That's how things look to me at any rate. I can almost virtually guarantee that at a certain point Playfish is going to have a lot of it's people "dumped into the pool" and new guys will be hired out of it, or another new company will be purchused at the same time.

 

[Therumancer]

-snip-

The one criticism I'll agree with though is the bit about a "smooth transition to digitally based content". I plan to fight that heavily, and I agree it's not likely to happen within two years. Right now I think discs and used games is the model to follow, and honestly I have yet to see ANYTHING that makes me want to give up those rights and become totally dependant on DLing from a company. With the exception of Valve's periodic sales, I rarely if ever see a digitally downloaded game (brand new) going for LESS than a store bought one despite all of the money allegedly being saved on packaging and such (they just keep that as profit). Even when dealing with lower prices, I see no real guarantee that we aren't dealing with a "Wal Mart" ploy. I mean let's say a service like say STEAM did drive disc based games out of business by say reducing all prices by 90% and keeping them there for 5 years or whatever. In the end, what would be stopping the service from raising prices again once they competition was gone?

Because valve(and steam) isn't run by ass holes.

Right now with their sales and the way they run things, they seem okay. There doesn't seem to be any real effort by them to drive disc based games out of existance.

The thing is that I'm not trusting, especially when money is involved. Things change, and bigger men than the valve employees have succumbed to temptation with a lot less on the line in the end. Right now I think the problem is mitigated by the fact that Valve probably couldn't afford a 90% universal price drop sustained over that long, nor could it guarantee reaping profits from doing so. Thus the temptation is minimal.

However is STEAM gets big enough, and enough stuff in the industry changes, will they stick to their guns? To be honest I'm not sure. Even nice guys eventually wind up hiring corperate sharks to do the unpleasant things in the end. "Ben and Jerries Ice Cream" for example was started by a couple of hippies who put too much sugar into their mix. They got big enough and despite all their ideals they wound up hiring corperate people to run things for them. Eventually they more or less sold out and became little more than mascots for their own brand. I'm not an expert, on Ben & Jerries, but the bottom line is this: I might have trusted them not to be a couple of greedy twits to begin with, but in the end that isn't who the world wound up dealing with. If money is involved things will corrupt after a certain point, and it will go uber-corperate. I kind of like the Valve guys despite everything and them not working within my preferred game generes... whether I'd trust them right now isn't the issue when looking at the big picture. With enough power behind it (which it does not currently possess) I could see STEAM and services like it putting the big box stores out of it. The thing is none of them have the money and resources to do that. If Valve had the money to make it viable, perhaps as part of a coordinated industry action, it would be like handing them a loaded gun, and honestly I'm not sure if I'd trust anyone not to pull that trigger (or hire someone to pull it for them).

Besides while I like what I see to some extent, I'm not sure how much of Valve's "public image" is real and how much is concocted. Valve seems like the kind of guys who would get involved in political activism over censorship and such. I thought it was rather uncharacteristic when they backed down to Michael Atkinson over "Left For Dead 2". I kind of expected a rumble there, and as many can tell you I'm deeply disappointed that they pretty much jumped on the "yes massta" bandwagon along with everyone else confronted by censors. Leading me to feel that in the end they really aren't all that differant from everyone else in the industry when it really matters.