Despite Rise In Game Quality, EA Boss Faces Fierce Doubts

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If gamers most care about whether games are any good — not whether stock prices are rising — then what to make of charges the EA's current boss might be the wrong man for the job?


FIFA was better last year. Left 4 Dead was good. Dragon Age was an acclaimed role playing game standout. Even little-selling Dead Space Extraction on the Wii was a critical star on a platform that has so few.

Yet just months after those EA games wrapped up the company's 2009 and just weeks before promising releases of Mass Effect 2 and Battlefield Bad Company 2, Electronic Arts, a former factory of mediocrity, is facing public comments that regime change might be needed.

On Monday EA announced that it was lowering its forecast for annual revenue, from $3.9 billion to $3.675, blaming a tough gaming market and gaming costs.

On Tuesday, financial analysts were sounding the call for change in a news story that reported that EA's stock price has dropped 70 percent during Riccitiello's tenure, from $52 in 2007 to $16.25 on Tuesday. (It's at $17.11 right now.) Oft-quoted Wedbush Securities analyst Michael Pachter told Reuters that EA's current management had "zero credibility" with investors and predicted that the top execs at EA wouldn't last another year if the company's financial well being wasn't turned around. Analyst Arvin Bhatia of Sterne, Agee & Leach said "some drastic action" is needed.

The irony for gamers, however, is that, in these tumultuous years, EA's games have gotten better. Not settling for anecdotal evidence or EA's own claims about that, we crunched some numbers on game quality last year, and, well, those who believe game quality can be judged by review scores would have to concede that, yes, EA's right and greatly outperforming the likes of Activision and Take-Two in game quality.


What is at stake in all this is the job of John Riccitiello, EA's CEO for the last three years, and a man who has preached the value of game quality as the essential ingredient not just for keeping games happy but for making money.


Riccitiello has espoused such values directly to Kotaku. In December he maintained his pride in EA's transformation under his leadership into a publisher that was putting out lots of quality games: "I think a pattern EA went on [in the past] and I think other companies are following right now is the trend of while you're milking your cash cows and nothing else, it's a very profitable business. While you're doing that it feels really good and [Wall] Street loves you. I think EA got into that position in the last cycle. I think other companies are in that position now. I've lived through both ends of that. And one of those reasons I spend so much time talking about quality and innovation is I don't think it's an end goal. I think it's a pursuit that doesn't stop."


With broad and a not completely fairly applied brush, Riccitiello's EA has been portrayed as the anti-Activision and, less controversially, the anti-old-EA. In other words, it has been cheered as a gaming behemoth that might not be noble enough to help little old ladies across the street or refrain from shutting down studios from EA Chicago to Pandemic (the latter was just too expensive, Riccitiello had told us), but is one that that has embraced the creation of new games and has pushed harder for innovation in its sequels, while expanding aggressively to the iPhone, Facebook and other new platforms. Riccitiello himself has been an unusual character, not just because he so feverishly promotes the idea of game quality but because he can talk the talk of game design better than most gaming executives. (See his Mirror's Edge chat with us.)


EA bristles at the doubts the analysts have about the Riccitiello regime, of course. "The industry is in the middle of what is arguably the biggest transition of its 35 year history," Jeff Brown, EA's director of corporate communications told Kotaku. "We feel that we've got precisely the right strategy. It's just not one that translates to immediate results in every quarter." Brown called the analysts' critiques "very short-sighted" and maintains that the company will continue to emphasize game quality and invest heavily in a transition to an increasingly digital-based gaming industry (read: less of a business reliant on the sale of discs).

The heat on EA's top brass puts gamers in an odd position. Ignore the goings on of well-iad executives and eager stockholders? Or focus on a conundrum that, as game quality has gone up, a major publisher's stock has fallen and maybe, just maybe the CEO in charge when both happened could be in jeopardy.



Maybe firing a bunch of people will come back to bite Mr. Riccitiello in the *ss. It's about time stuff like this is taken into consideration. Is a 'successful' company that constantly had to lay off people really that successful?

I'm sure Mr Riccitiello didn't personally fire anyone, but like the captain of a ship, he is ultimately responsible for anything that happen in his company.