Zynga Now Estimated to Be Worth More than EA

polypusher wrote:

Dont overlook Zynga's out-of-game missteps over the past few years. IPO, multiple developer purchases for huge, unrationalized sums etc. Their games are plenty profitable but they bet hard trying to play like a publisher and blew all of those profits.

I dont think much has changed in reality for social games themselves. (insert plug for my anti-social Facebook game here :) )

I think Zynga's biggest issue is one of scale. It's definitely possible to make money on web games, but there is a lot of low/no cost competition in that space and you cannot support a company of Zynga's size with this business model alone.

It's also interesting to note that Zynga management appears to have been worried about the limits of the web casual game market for a while now, and they have attempted to diversify somewhat by (as you mention) buying up mobile app developers for inflated prices. They are even trying, for example, to market a physical "Words With Friends" board game.

Unfortunately, none of these purchases seem to have paid off in a sustainable way, leaving Zynga only with the husks of formerly popular games to show for their substantial investments.

gore wrote:

It's also interesting to note that Zynga management appears to have been worried about the limits of the web casual game market for a while now, and they have attempted to diversify somewhat by (as you mention) buying up mobile app developers for inflated prices. They are even trying, for example, to market a physical "Words With Friends" board game.

I swear I've played that before....

Quintin_Stone wrote:
gore wrote:

It's also interesting to note that Zynga management appears to have been worried about the limits of the web casual game market for a while now, and they have attempted to diversify somewhat by (as you mention) buying up mobile app developers for inflated prices. They are even trying, for example, to market a physical "Words With Friends" board game.

I swear I've played that before....

Yeah, me too...

*scratches head*

Dunno.... Babble? Dabble? That's a tough one.

(that we probably all played growing up)

I was at ToysRUs with my kids laat week and the first thing you see are is a giant wall of Words With Friends, Temple Run, and Angry Bird themed games. They also had Pandemic, Catan, Wits & Wagers and Risk 2120 so I guess its not all bad

SocialChameleon wrote:

I had heard things were badly mishandled in the Austin office. In Boston it went somewhat better, we weren't rushed and didn't have security looking over our shoulder. HR reps were there and took all the time we needed to answer questions, help walk us through various forms and get personal effects shipped to us that were too big or numerous to take home ourselves that day.

Some people from our office were offered work in SF on soon-to-launch projects but turned them down. I would have preferred that the VP and HR reps they sent to shut us down didn't bring up that possibility in front of everyone, but it wasn't the worst layoff I've ever been through.

That still really sucks- best of luck to you. Also, thanks for the first-hand account. Glad you were at least treated with some dignity and professionalism on your last day there.

More Zynga closures announced today: New York, Los Angeles, Austin, and Dallas. 18% headcount reduction (520 employees), totaling $80 million in staff expenses. Yeesh.

shoptroll wrote:

More Zynga closures announced today: New York, Los Angeles, Austin, and Dallas. 18% headcount reduction (520 employees), totaling $80 million in staff expenses. Yeesh.

Yow.

Title of this thread: not so accurate now.

gore wrote:

Title of this thread: not so accurate now.

Let's wait until EA's quarterly report is released before updating the title thread

Why the heck did they need 2,500 employees to begin with?

LeapingGnome wrote:

Why the heck did they need 2,500 employees to begin with?

Other people's code won't steal itself.

Why the heck did they need 2,500 employees to begin with?

Those social media games that only take 3 people at PopCap need 50 people and a marketing team of 15 at Zynga.

You kinda need a critical mass of people to 'like' your new game announcements on facebook.

Facebook likers are the new "yes men"?

fangblackbone wrote:

Facebook likers are the new "yes men"?

IMAGE(http://getwiredin.files.wordpress.com/2013/01/facebooklike.png?w=300&h=256)

fangblackbone wrote:
Why the heck did they need 2,500 employees to begin with?

Those social media games that only take 3 people at PopCap need 50 people and a marketing team of 15 at Zynga.

So again... why did they need 2500 employees?

They have a team of 50 for all of their 50 social media game/ripoffs.

cube wrote:
fangblackbone wrote:
Why the heck did they need 2,500 employees to begin with?

Those social media games that only take 3 people at PopCap need 50 people and a marketing team of 15 at Zynga.

So again... why did they need 2500 employees?

If they are like any of the other net companies, many of them were ice cream vendors, yogis, and crack pipe holders.

cube wrote:
fangblackbone wrote:
Why the heck did they need 2,500 employees to begin with?

Those social media games that only take 3 people at PopCap need 50 people and a marketing team of 15 at Zynga.

So again... why did they need 2500 employees?

To misquote Unforgiven: need's got nothin to do with it.

Zynga surely ended up with a ton of redundancies after all of its acquisitions. There was a time when they were buying up every social or mobile game they could grab (generally right after they had peaked) and I'm sure their payroll ballooned to ridiculous levels due to that.

The most amazing thing about this thread to me is that it was only started two years ago and the subject was very true at the time. Many speculated then that Zynga would acquire some place like EA eventually. Incredible what's happened in other a couple of years.

This is what I wrote in a Gamasutra comment:

Say, this wouldn't happen to be one of those situations where a public company's shareholders hire slash-and-burn executives at the top level to 'downsize' the company (and therefore cause the share price to skyrocket as everyone in Wall Street begins speculating on the micro-bubble that is the corporation's soon-to-be corpse) while simultaneously hiking their salaries and installing various other shady mechanisms of personal profit (ostensibly as a means of 'competing' with all the other CEOs with whom they are in truth colluding to inflate each other's salaries) so that everyone on top can jump ship at exactly the right moment and escape in golden parachutes while anyone attempting to play by the rules is swindled out of the fruits of their labor, would it?

You probably saw the link at the top of the article in Gamasutra: http://www.gamasutra.com/view/news/1...

Part 1 (i.e. hiking salaries) is in place. Pincus has made his money, so he can cover for the rest with the $1 salary he's getting this year.

Remember Draw Something's OMGPOP? Yowch!

A gaming consultant calculated that Zynga lost nearly $528,000 per day on OMGPOP—dividing its $200 million purchase price by the 379 days that Zynga owned it. “What can be said?” Brian Blau, an analyst with Gartner Research, told Ars. “A colossal waste of money on a company and people that were not a fit, and possibly because the acquisition [of its] games just didn't perform."
Parallax Abstraction wrote:

Remember Draw Something's OMGPOP? Yowch!

And in the end, one guy made the right choice after all.

I played Draw Something briefly. On the face of it, a fun Pictionary-ish diversion. The default color pack is very much lacking and you had to play it a lot to get even the most basic colors. Still the biggest problem was the that word choices got more and more terrible as time went on. You'd get sh*t words that there was no possible way to draw, or it's some "celebrity" you've never heard of. The words you could draw would show up over and over again. Or you could pay for better word choices! IMAGE(http://rps.net/QS/Images/Smilies/rolleyes.gif) Worst of all, once you started a game with someone, there was no way to end it.

Quintin_Stone wrote:

I played Draw Something briefly. On the face of it, a fun Pictionary-ish diversion. The default color pack is very much lacking and you had to play it a lot to get even the most basic colors. Still the biggest problem was the that word choices got more and more terrible as time went on. You'd get sh*t words that there was no possible way to draw, or it's some "celebrity" you've never heard of. The words you could draw would show up over and over again. Or you could pay for better word choices! IMAGE(http://rps.net/QS/Images/Smilies/rolleyes.gif) Worst of all, once you started a game with someone, there was no way to end it.

I had a similar experience. Having to buy colors with microtransactions? Lame words? Advertiser placed words?

Meh.

It was a game that was in the right place at the right time, basically. It had no sustainable monetization strategy, and the money they were making was done in annoying ways that ensured customers would disappear. I guess the original owners played their hand incredibly well, rising so fast and then exiting with a mountain of cash before the inevitable fall.

You have to wonder with those huge acquisitions whether Zynga was looking beyond the potential of the existing games and hoping they were buying some kind of secret sauce from those companies that would enable future blockbusters. Like, they wanted to find a magic group of people that could somehow predict what would be a hit in the future. Obviously, that didn't happen.

gore wrote:

You have to wonder with those huge acquisitions whether Zynga was looking beyond the potential of the existing games and hoping they were buying some kind of secret sauce from those companies that would enable future blockbusters. Like, they wanted to find a magic group of people that could somehow predict what would be a hit in the future. Obviously, that didn't happen.

It's very reminiscent of the .com bubble bursting IMO.

Party at OMGPOP following closure announcement. Probably not something the Zynga executives probably wanted to hear.

shoptroll wrote:

Party at OMGPOP following closure announcement. Probably not something the Zynga executives probably wanted to hear.

Getting laid off is sometimes quite lucrative, if you've planned for it properly.

gore wrote:
shoptroll wrote:

Party at OMGPOP following closure announcement. Probably not something the Zynga executives probably wanted to hear.

Getting laid off is sometimes quite lucrative, if you've planned for it properly.

+1 !!!!!

Tkyl wrote:
gore wrote:
shoptroll wrote:

Party at OMGPOP following closure announcement. Probably not something the Zynga executives probably wanted to hear.

Getting laid off is sometimes quite lucrative, if you've planned for it properly.

+1 !!!!!

I like that they all grabbed a beer from the office fridge before the meeting.

Here's another link, this time the dish from former Zynga employees about working there:

http://valleywag.gawker.com/fired-zynga-staff-hits-reddit-to-talk-life-before-the-511412384?utm_campaign=socialflow_gawker_facebook&utm_source=gawker_facebook&utm_medium=socialflow