The disappointing thing is that EA did go through a periodo f promising change - one that the free market rejected.
This would be about 2008-ish - EA invested heavily in new franchises, or different takes on existing ones. Dead Space, Mirror's Edge, Battlefield: Bad Company (a huge departure from the Battlefield norm), etc.
None of which sold particularly well, and pretty much Dead Space is the only one that lived on as a franchise. The market voted with their wallets for more sequelitis.
When you are dealing with AAA budgets, anything less than 3M copies is likely a loss, and you usually have to venture into 5M copies to start actually making money, generating value and creating confidence in the brand / IP.
The AAA arms race has destroyed many studios, IPs and careers. 10 years ago, it used to be that one single hit could pay off your other 9 underperforming titles. With budgets going up 10x and top sales going up at best 2x, that balance can't hold and you have to be ruthless killing underperformers. I'm not a fan of Bobby Kotick (I was part of one of his layoffs!), but look at how he has led Activision as a company.
Does it matter? If their production costs are too high, they should find better ways of controlling costs; a game that sells 2.5 million copies is still a game that the market has validated.
> If their production costs are too high, they should find better ways of controlling costs;
They do: they find other games that are more profitable to make.
> a game that sells 2.5 million copies is still a game that the market has validated.
Corporations don't exist to be "validated" in some nebulous. They have to make money. I could get the market to wildly validate any product: give it away for free, or, hell, pay people to use it.
That unfortunately doesn't make for a successful business.
The point is that if 2.5 million people are willing to buy the game, the demand side of the equation is a settled one, and it's up to the supplier to find a way to turn that demand into a viable profit. If EA can't, then it's a problem with their own operations, not a problem with the product.
If someone else can produce a title that satisfies the demonstrated market demand for city-simulation games by producing one that is profitable, then they'll win and EA will lose.
Not sure about transformation - I never saw anything good in their books not in plans. My understanding that only reason why EA stock up last 3 months is because it is heavily shorted stock.
This would be about 2008-ish - EA invested heavily in new franchises, or different takes on existing ones. Dead Space, Mirror's Edge, Battlefield: Bad Company (a huge departure from the Battlefield norm), etc.
None of which sold particularly well, and pretty much Dead Space is the only one that lived on as a franchise. The market voted with their wallets for more sequelitis.