Posted on August 21, 2012 AT 03:52pm
The gaming industry is a precarious, ever-changing place and today’s layoffs at PopCap proved just how precarious.
At least 50 employees are being let go, most of them at PopCap’s Seattle studio though a few were employed at the Vancouver studio. There is also the possibility of additional layoffs at PopCap’s Dublin studio in the future. That amounts to 10% of the company and a 10% labor loss at any company is fairly significant.
John Vechey, PopCap co-founder, explained the reason for the layoffs on the PopCap blog and that PopCap is making this move in an attempt to keep healthy and viable in the industry shift to social and free-to-play games.
“A little context on why we’re making cuts in some areas while we’re investing and expanding in others: In the past year, we’ve seen a dramatic change in the way people play and pay for games. Free-to-play, social and mobile games have exploded in popularity. That happened fast. Surprisingly so. The change in consumer tastes requires us to reorganize our business and invest in new types of games on new platforms. It’s a completely different world from when we started.There’s also an economic component to the reorganization. To stay in business, we need to manage costs, improve efficiency and maintain a profit. We’ve been able to invest in creative new games like Peggle and Plants vs. Zombies because we had a high profit business. That business is challenged, and if we don’t adapt, we won’t be able to invest in new IP. That sounds harsh — but if we don’t stay in business, no more plants, zombies, jewels, frogs or worms,” he wrote.
Vechey also explained that PopCap is looking into “exploratory consultation” to decide whether or not to keep their Dublin office open.
“Exploratory consultation’ means we’re talking to our Dublin team about the future of that office and whether we can find a path to improve our profitability in Europe without having to close the operation.”
Last year Electronic Arts had purchased PopCap in a move that its executives said would lead to growth and and additional investment at PopCap. It’s safe to assume that if EA had not been involved, the layoffs would have been greater.
Vechey wrote, “We’re glad to have those resources supporting us when a lot of other independent studios are struggling. In addition, some of the people affected by the reorganization may be retrained and reassigned to other jobs the EA studios. If we didn’t have EA behind us, the cuts would have been worse.”
The camaraderie that is felt in the gaming industry was evident on Twitter after the announcement of the layoffs through messages of support and tweets with job openings at other companies.
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