Our Silicon Valley and tech-focused sister site Valleywag is reporting that CBS will be merging CBSnews.com and CNET's News.com. While we're aware of some cuts already hitting GameSpot, we're not yet clear on the extent of those lay-offs.

We'll keep you updated between bouts of blog-crippling depression and wish former GameSpotters the best of luck.

The death of CNET's media-conquering dreams [Valleywag]

In October, EA announced it would lay off 6 percent of its employees, approximately 600 positions. The next round of cost cutting will see additional lay-offs, facility consolidations and a software release list leaner than 2008's.

"While we saw significant improvement in the overall quality of our key products this year, we are disappointed that our holiday slate is not meeting our sales expectations," EA CEO John Riccitiello said in a prepared statement. He attributed part of the decision to an "uncertain economic environment."

EA says it will be "taking steps to reduce our cost structure and improve the profitability of our business."

Analysts pointed to new titles Mirror's Edge, Rock Band 2 and Need For Speed Undercover as possible underperformers, leading to estimated holiday quarter earnings $70 million lower than previously projected.

Riccitiello said during an investor call that followed the release it plans to cut "SKUs from the bottom levels of profitability."

He later clarified that reductions in the '09 line up would likely not affect its sports titles, but would be "divided evenly between core and casual" software.

Next year will be EGM's 20th year in print, should it last until summer of 2009 for its two decade anniversary. Young tells the New York Times that Ziff Davis is "considering" moving EGM to an online-only format on 1UP.com, but would not make the decision before end of year.

Young blamed rising costs associated with print and decreased advertising as reasons for the closing of PC Magazine.

Ziff Davis filed for bankruptcy earlier this year and is working on eliminating its debt. The publisher has shut down a number of print pubs over the past few years, including the Official PlayStation Magazine, GMR and most recently Games For Windows: The Magazine.

PC Magazine, a Flagship for Ziff Davis, Will Cease Printing a Paper Version [New York Times via Gamasutra]

Circuit City owes close to $900 million to its vendors, which a $1.1 billion loan will help pare down. Speaking of paring down, CC will also be shedding another 700 employees, on top of the thousands already hit by the axe, according to the Wall Street Journal. The company's stock, in turn, tumbled further.

WSJ also reports that the U.S. of A's second largest electronics retailer owes over $118 million to HP alone, with a $60 million bill to PlayStation manufacturer Sony also unpaid.

The silver lining to this economic nightmare and the reality of thousand of out of work retail employees is that you'll save 10, maybe 20 percent on all sorts of goods, from video games to consoles to electronic gizmos. Their massive misfortune is your marginal gain!

Circuit City Files for Bankruptcy [WSJ]

THQ bled cash to the tune of $115.3 million, way up from Q2 2007's loss of $7 million. Potentially worse for gamers was the delay of Red Faction: Guerrilla and Darksiders: Wrath of War well into 2009.

The publisher also confirmed it would lay off 250 employees as part of a "strategic plan and business realignment."

THQ further explained that its plan involves "the cancellation of several titles that were in development but had not been publicly announced."

Both Red Faction: Guerilla for Xbox 360, PS3, and PC as well as Darksiders: Wrath of War for Xbox 360, and PS3 will now ship after March 31, 2009 a move that will hurt the company's fiscal 2009 to the tune of approximately $125 million.

For the quarter, THQ reported that the lion's share of its revenue came from the Nintendo DS and Wii, similar to Activision Blizzard's console earnings announced earlier today. THQ released de Blob and WALL-E (internationally) on those platforms, with the latter seeing lower than expected sales.

EA CEO John Riccitiello said during the company's earnings call that "We are starting to see weakness at retail in October, indicators that retailers and consumers are being more cautious." EA's observations may lead those who brand the video game industry as "recession proof" to slightly alter their opinions. It has already led EA to start cutting costs.

That slowness is a red flag for the mega-publisher, which says it's "proactively making cost adjustments now." One of those adjustments is the axing of some 600 EA employees across the globe.

Riccitiello and crew will also cut costs by eliminating what the CEO referred to as "marginal SKUs" and managing headcount "aggressively" going forward.

"While we're very bullish long term, we're very cautious in the short term," Riccitiello said, saying the company was investing more than ever in digital distribution and its EA Partners program.

"We experienced a few slips and kills," Riccitiello noted during the call, referring to publicly disclosed cancellations like EA LA's Tiberium and the delays of Harry Potter and the Half-Blood Prince and Pandemic's Saboteur and Lord of the Rings: Conquest as having an impact on revenue. A drop in back catalog titles was also blamed for weaker performance.

It wasn't all bad news for EA, as sales of Madden NFL 09 topped 4.5 million copies during the quarter, with Spore nearly hitting 2 million copies sold in just three weeks, as did Mercenaries 2: World in Flames. Warhammer Online: Age of Reckoning, also moved 1.2 million copies, putting EA "back in the MMO game."

EA Reports Second Quarter Fiscal Year 2009 Results

REDWOOD CITY, Calif., Oct 30, 2008 (BUSINESS WIRE) — ERTS | Quote | Chart | News | PowerRating — —800 Thousand Registered Users Playing Warhammer Online
—Need For Speed, Mirror's Edge To Join Holiday Portfolio of 20 Titles

Electronic Arts Inc. (NASDAQ:ERTS) today announced preliminary financial results for its fiscal second quarter ended September 30, 2008.

Fiscal Second Quarter Results (comparisons are to the quarter ended September 30, 2007)

Net revenue for the second quarter was $894 million, up $254 million as compared with $640 million for the prior year. During the quarter, EA had a net deferral of $232 million of net revenue related to certain online enabled packaged goods games and digital content as compared with $296 million in the prior year.

Non-GAAP net revenue was $1.126 billion, up 20 percent as compared with $936 million for the prior year. Sales were driven by the launches of Madden NFL 09, SPORE(TM), Mercenaries 2: World in Flames(TM), NCAA(R) Football 09, Tiger Woods PGA TOUR 09, Warhammer(R) Online: Age of Reckoning(TM), as well as the continued strength of Rock Band(TM).

Net loss for the quarter was $310 million as compared with net loss of $195 million for the prior year. Diluted loss per share was $0.97 as compared with diluted loss per share of $0.62 for the prior year.

Non-GAAP net loss was $20 million as compared with non-GAAP net income of $87 million a year ago. Non-GAAP diluted loss per share was $0.06 as compared with non-GAAP diluted earnings per share of $0.27 for the prior year.

Trailing-twelve-month operating cash flow was $219 million as compared with $145 million a year ago. The Company ended the quarter with cash and short-term investments of $1.825 billion.

"Considering the slow down at retail we've seen in October, we are cautious in the short term," said John Riccitiello, Chief Executive Officer. "Longer term, we are very bullish on the game sector overall and on EA in particular. The industry is growing double-digits on the strength of three new game consoles and increases in the number of homes with broadband internet connections. EA is well positioned to benefit from these technology drivers due to the strength of our creative studios and our broad collection of game properties—from The Sims, to Spore and Madden NFL, to Warhammer Online."

Highlights

— Madden NFL 09 sold 4.5 million copies and was the number one title across all platforms in the quarter based on NPD data.

— SPORE is a hit selling nearly 2.0 million copies in just 3 weeks — over 40 million creatures have been uploaded into Sporepedia(TM). SPORE is the number one title on the PC in North America and number three title in Europe year-to-date.

— Warhammer Online: Age of Reckoning, an MMO from EA's Mythic Entertainment studio, sold 1.2 million copies in the quarter — with over 800 thousand current players.

— The EA SPORTS core portfolio of annual simulation games takes a step up in quality — up 4 points year-over-year according to Metacritic's aggregated review score system on the Xbox 360(R) and PLAYSTATION(R)3 entertainment systems.

— EA was awarded 5 of the 9 honors at the Leipzig Games Convention in Germany —Spore as best PC game; Mirror's Edge(TM) as best Xbox 360 game; Skate It as best Wii(TM) game; Warhammer Online: Age of Reckoning as best online game; and Sonic Chronicles, a game developed by EA BioWare, won best Nintendo DS(TM) game.

— EA Mobile is the world's leading publisher of games for phones — with revenue of $47 million — up 24 percent year-over-year.

— EA BioWare and LucasArts announced the development of Star Wars(R): The Old Republic(TM), a story-driven massively multiplayer online PC game.

— EA signs publishing agreements with Grasshopper Manufacture and Epic Games.

EA Announces Cost Reduction Plan

EA announced today a cost reduction plan, which will include the elimination of approximately 6% of the Company's workforce. The Company estimates its cost reduction plan will result in annual pre-tax cost savings of approximately $50 million.

Today it dipped even further, bottoming out at 79 cents a share, closing at 90 cents. The company recently cut loose some of its licenses to improve its financials, something we hope sales of Mortal Kombat vs. DC Universe goes a long way to revitalizing.

Tell you what Midway, you put out a respectable copy of Hydro Thunder on Live or PSN, and I'll buy two copies. Hope that'll help. :(

Bad Day For Midway [Forbes]