thebobmaster said:
Second point: Closing down studios.
I love this one. Apparently, EA is a vampire that sucks great studios dry, and casts their corpses aside in search for new blood. This ignores a few things. First, how can EA buy a studio that doesn't want the help? They can't.
Ok, first thing: There is another reason companies merge: because they realise they will be stronger if they combine their assets. Look at Activision Blizzard, the result of a merger between two successful companies and five years later they're both doing fantastic. Some of EA's buyouts didn't last two years!
This is an important point, because some of the companies merged into EA did so to take advantage of working within a larger company, and found themselves suffocated.
So, let's take an adventure into the seedy underworld of EA's corporate buyouts!
I'm using hidden text to centre this gif!
We'll start with exhibit A, otherwise known as
Origin Systems: Founded by now well-respected game designer Richard Gariott. one of the first EA buyouts, and one of the worst. You are right in saying that they did end up in financial difficulty, and had to either sell to EA or go bankrupt, but what you may not know is that
EA put them there. With frivolous lawsuits and corporate bullying they wore them down until they were in debt, and had to settle. Then EA bought them out, and the founder of EA when asked about the tactics they used to aquire it said "This is just business. This is the way we're going to win."
Let's move on to exhibit B,
Westwood Studios.
Westwood had 7% of the videogame market share at the time they were bought out, EA had 11%. They were not a floundering company, they were highly successful and doing very very well. In fact they were halfway through the next C&C game. The reason for the buyout lies in money. $122.5 million in cash to be exact, which was what the owners of Westwood were paid by EA for their company. It was a quick money grab, and many of Westwood's employees registered their personal feelings about being betrayed by the owners, and most of them quit their jobs in protest.
What happened to the "awesome C&C" game they were in the middle of developing after EA bought them?
Electronic Arts, who had acquired Westwood Studios in 1998 and published Tiberian Sun, and had no direct part in its development, pushed for Tiberian Sun's release ahead of schedule, resulting in a number of engine and gameplay features being omitted from the game, some of which were later included in Firestorm expansion pack.
Rushed deadlines and putting features meant for the main game in an expensive extra content pack? Start as you mean to go on, I suppose.
And now for Exhibit C, I refer, Your Honour, to the joint acquisition of
Bioware/Pandemic, and this juicy tale of corruption runs right the way to the top of the house!
Pandemic were partnered with Bioware, due to them being owned by the same private equity fund (V.G Holdings). By the way, this is another perfect example of two companies merging not because one is on deaths door, but because they realise they can do better together, and it worked really well! Until...
A certain man by the name of John Riccitiello became CEO of EA. He had a very impressive C.V., including working in Haagen Dazs, several previous upper management positions in EA, and co-founding a company called Elevation Partners.
Hold on to your ass, because things are about to get corporate.
Elevation Partners was a large Investment firm, meaning it held a lot of private businesses. Among these businesses was a certain "V.G Holdings". Yes, the same V.G. Holdings that ran Bioware/Pandemic. One of the first acts John made when he became CEO of EA was to buy VG Holdings for $620 million. This gave EA two top quality companies that were just exploding onto the videogame scene.
However, John still held a huge personal interest in Elevation Partners, and so he personally pocketed a $5 million personal bonus by Elevation Partners through his official role there for the merger.
What happened after EA had bought the two companies? Bioware did well... for a while. Now the team that made fantastic singleplayer RPGs are stuck perpetually maintaining a failing MMO loosely based on one of their most successful IPs. Pandemic are... dead. Because EA didn't really have a plan for them.
They lasted one year and a month. How does a company get canned so quickly, especially one that creates such a long term product as a videogame? The Duke Nukem Forever developers lasted ten times as long and they weren't even doing any work!
It's because EA never had a plan for Pandemic, they never had any games reserved for them to make, and they didn't bother to use their talents or name. They didn't factor into EA's business plan, and were canned at the first excuse.
The reason for the merger was John Riccitiello's 5 million dollar handshake, and you know what? For that amount of money you can't really blame him.
