What I Don’t Get About the Gaming Industry

“As you know, seasonal roll-offs that follow game launches are common and vital to maintaining a healthy business” – EA Spokesperson Jeff Brown

Why is it that this statement seems only true for the gaming industry? I’m probably missing a few other industries that do this so nonchalantly in tone. It seems impossible to maintain a stable, motivated workforce in the gaming industry.

“We had a solid first quarter, exceeding expectations both top and bottom line,” said John Riccitiello, CEO (from Q1 2011 earnings report at investor.ea.com, dated August 3)

“EA is well-positioned for the year ahead and reaffirms its FY11 non-GAAP guidance,” said Eric Brown, Chief Financial Officer. “Digital revenue is expected to grow approximately 30% year over year, to $750 million in the fiscal year.”

Good thing EA doesn’t need staff to hit that growth. I suppose we have a better understanding of who straddles that ‘bottom line’. As a guy in business, I value my staff, their families, and their contribution as paramount to my personal and professional success. Talk to the Guru business leaders and you get the same story – it is all about motivating, empowering, and giving ownership to your team.

Not going to wax poetically here I do not know the way the gaming industry ticks – only that it sounds like a time bomb.

Oh, for giggles, the ending quote of Mr. Brown in the same article over at Gamasutra.com

“Because so many of our games ship in the holiday quarter, the team size adjustments tend to follow in the same timeframe. However, EA is growing and several of our studios are looking to hire talented people.”

Maybe you should move those talented, experienced people you just fired over to the new studios? Just a thought.

4 comments / Add your comment below

  1. New hires are cheaper. With a near-endless stream of new graduates from the local game colleges, it’s no surprise that number-happy “bottom line” chasers would take advantage of it.

    Of course, I’d argue that experienced devs are better for a project, but then, there’s also that burnout thing that veterans deal with. Churn and burn is part of the industry, unfortunately. Corporate raiders leverage it.

    …it’s not healthy in a lot of ways, to be honest, but it’s still a youngish industry, and there’s a lot of enthusiastic teens aching to break into it. The industry still has a lot of growing up to do.

  2. Oh, I’ve heard the reasons for it (every time the firings are posted on a blog, and the corresponding comments bring up those reasons) but I just don’t get it from a business perspective still. It’s boggling.

  3. It’s an immature industry, really. The guys in charge don’t really grok business. That’s why it doesn’t make a lot of sense to someone who *does* understand how these things should work.

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