The evidence of the severity of cutbacks at Electronic Arts‘ game studios is starting to show.
This year, EA isn’t making a version of its NCAA Basketball video game series in time for the March Madness college basketball tournament. That’s truly unheard of for EA Sports, which has released a game every year since 2003. The last game in the franchise, NCAA Basketball 10, debuted in November. EA confirmed that it is “reviewing the future of our NCAA Basketball business.”
But since that time, EA has said it would lay off 1,500 employees and cut back on marginal products. The company made some painful cuts, killing numerous games and shutting studios such as Pandemic. Now it’s clear that the EA Sports business, which has generated annuity revenues for almost two decades, is not immune to cutbacks. EA said this was a difficult decision but it was committed to the NCAA.
On top of that, reports have surfaced that negotiations with the NCAA over video game rights are on hold. EA’s rival, Take-Two Interactive, scuttled its NCAA College Hoops series two years ago over licensing difficulties. EA has also canceled DeadSpace 2 for the PC.
Meanwhile, EA Sports may have other problems. It has said it remains committed to the Tiger Woods PGA Golf Tour franchise and recently launched a free-to-play online beta under the Tiger Woods name. But Woods’ sex scandals have derailed his career and raised a lot of questions about the value of a franchise based on his name. Meanwhile, EA has acknowledged that it is making a version of its Madden NFL football game for Facebook, and it is working on a new version of EA Sports Active for multiple platforms.
EA used to cover all the bases, especially in sports. But now it’s clear it can no longer do so. EA isn’t the only game company hurting or reprioritizing. Activision Blizzard saw its music game sales plummet in the holiday season, and various web sites report that the game company has shuttered its Red Octane music game division.
Please check out our GamesBeat@GDC conference at the Game Developers Conference on March 10 in San Francisco. Our lunchtime fireside chat will be with EA’s chief operating officer, John Schappert.
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