EA's Riccitiello offers recession survival tips

D.I.C.E. 2009: CEO offers conference three rules to making it through current economic downturn, which he calls "a blessing" that will thin the game-industry herd.

LAS VEGAS--The new American McGee Alice game from Electronic Arts was the biggest headline to come from CEO John Riccitiello's presentation at this year's D.I.C.E. Summit--his second in a row. However, the brief address contained some advice that could prove much more interesting to publishers and developers struggling in the rough economy.

Using a screenshot of a spectacular car crash as the starting point of his talk on the economy, Riccitiello acknowledged the layoffs that the recession has drawn from game makers like Midway, THQ, and EA itself. Rather than dwell on the cuts, Riccitiello shared with the audience his own approach to thriving in a failing economy.

The EA CEO said that when the economy turns south, the first things accountants say to do is cut headcount, close facilities, and reduce creative risk. If the problems persist, the advice is to do more of the same.

"That's a recipe you would follow at your peril," Riccitiello mused.

In this market, companies can't save their way to success, he continued. Instead, they need to focus their investments. To that end, Riccitiello's three rules for surviving a recession are to decide what's important, invest in those programs, and cut the rest. For EA, Riccitiello said the important parts are investing in quality, new IP, and gaming as a service, a topic that Valve founder Gabe Newell addressed in his D.I.C.E. keynote address on Wednesday.

"I actually think that the economic crisis the game industry moved into in 2008 is a blessing," Riccitiello said in a question-and-answer session following his presentation. One benefit, he said, is that a lot of "the riffraff" will go bankrupt. That's a positive event in his eyes because it's difficult to compete with shelves choked by substandard games. And while Riccitiello acknowledged that EA got "a little bit fat and a little bit too reliant on the way things were," he also added that the recession is a chance for those who act decisively to set themselves up for years to come.

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Discussion

91 comments
Megamanx266
Megamanx266

Ummm... since when did EA license Valves games?Valve does their own licensing/publishing LOL. etherTwilight FAILS The fact that EA has games on Steam does NOTHING to suggest that Valve is actually partnered with EA to help produce their own games. It's only a partnership to give EA another way to distribute their majority of lackluster IP's.

DavidRI
DavidRI

After reading Gabe Newell's address, the comparison is staggering. Die EA, your time has come with your crummy DRM anti-piracy tactics. Let game industry innovators, like Valve, lead the way.

DavidRI
DavidRI

"Quality, new IP, and gaming as a service" Words that EA doesn't understand; they will never publish top quality products and support them like Valve. For every good game EA manages to publish there are 10-15 stinkers. Excuse me, but EA is a big part of the "riff-raff"!!

tOrchie
tOrchie

EA's best bet would be to eliminate all of their DRM and Secure-ROM programs. Watch their sales skyrocket after that.

hotrider12
hotrider12

when EA produce a good NFS i'll believe it til then YAWN!!! EA IS THE DANG RIFF OF THE RAFF'S and if NFS shift,nitro's and world online dont make it we will celebrate hearing they went bankrupted wa-ooooooooo!!!

Old_Captaini
Old_Captaini

"One benefit, he said, is that a lot of "the riffraff" will go bankrupt. That's a positive event in his eyes because it's difficult to compete with shelves choked by substandard games" By riff raff substandard games does he mean Mercenaries 2? Ooops wait that was an EA game....sorry! LOL!! In fairness...EA put out a lot of good stuff last year too. Dead Space, Burnout Paradise, Bad Company are all outstanding examples.

SweetMusic
SweetMusic

Look, it's Darth Vader John Riccitiello and the Evil Empire EA. Pics: eattake2.com

gameking5000
gameking5000

In a recession there is no fixed working advice.

ChamomileBaths
ChamomileBaths

Inconnux, Activision has been on record saying they only want products they can exploit every year. That's the perfect example of greediness and a building sense of arrogance because their time and money is only worth spending on the same 8 products. EA made some big moves already: Skate, Mirror's Edge, Dead Space, Dante's Inferno (though in that example they're bending a little to make it a mass market game).. The effort is there. Their PC games have DRM so don't buy them. Spore got killed for it and I've gotta guess they learned. For a little under a year I've started to consider EA a totally valid company. Tons of older IPs which they use in creative ways (Battlefield 1943, Battlefield Heroes, Burnout Paradise expansions, and the attempt they're making with All-Play are all good examples).

Inconnux
Inconnux

@etherTwilight EA gets the majority of gamers' hatred and not Ubisoft and Activision because they are NOT doing the exact same thing. I detest EA because they treat me like a criminal if I buy their games. I will NOT purchase a game with securom. Period. I will boycott any product that tries to infest my system with it. EA is arrogant, just... just read the article and see why... riffraff and sub par products? Just look at the stuff EA produces... pot.. kettle... I don't remember the CEO of either Activision or Ubisoft saying such arrogant statements. As for Valve, first they ALWAYS put out a quality product. Most people buy their products via Steam. Sure they use EA as a publisher, but I count that as a strike against them. I won't stop buying Valve products simply because I can purchase them without handing EA money. Activision? they are linked with Blizzzard which always does its best to release a good product. All these companies are businesses, and make decisions that people don't like but EA goes out of their way to piss off their customers.

slipknot61174
slipknot61174

This guy is the Lord Vader of gaming. He's lucky I actually like villains, or else I'd be taking shots at him like everyone else here.

EtherTwilight
EtherTwilight

Question for the EA haters: Why is it that EA gets the majority of gamers' hatred when Ubisoft and Activision do the exact same thing? Yes, all the major game companies release tons of schlock, but honestly it's par for the course in the current industry. Go to your local videogame retailer and take a waltz through the Wii and DS sections. Yikes. Look at how much of the so-called "riffraff" bears the Activision or Ubisoft logo. Yet nobody seems to point out the EA partners deal, which is securing that certain studios' IPs come out? So...just Dead Space? Or is it also including: Crysis, Mass Effect 2, Dragon Age: Origins, Brutal Legend*, The Orange Box, Left 4 Dead (BTW, how come everyone is always behind Valve but nobody cries foul about them partnering with EA?), Ghostbusters*, Rock Band. How about a new American McGee game, working with id Software, Grasshopper Manufacture, People Can Fly Studios? How about taking a chance with new IPs like Mirror's Edge, which I can't imagine a company like Activision EVER giving the green light? * Activision passed on both Ghostbusters and Brutal Legend. Activision CEO Bobby Kotick stated "With respect to the franchises that don't have the potential to be exploited every year across every platform..." as to why the two IPs were dropped after the Vivendi takeover. Oh, but I guess EA is the company that hates new IP, and is the only major publisher throwing its money around. Oh, but EA has annualized franchises! Evil! Let's just disregard: Call of Duty, Guitar Hero, Tony Hawk, Rayman, My (Something) (Something) - see My French/Spanish/English/Word/Japanese/Chinese Coach...with new ones coming out all the time. Ubisoft's Jake Powers anyone? How about the Imagine series? Hrm? I don't get how someone who buys Madden every year and thoroughly enjoys it is considered as being less than the people who buy the new Call of Duty or Guitar Hero every year. OH. But those are REAL games...sorry. Meanwhile! Activision has multiple studios work on their Call of Duty and Guitar Hero franchises to have at least one release per year, if not multiple, but if Harmonix wants to take a break from Rock Band to do something else - Beatles game - that's okay. But, again, EA's evil? Bottomline: EA is a business. Activision is a business. Ubisoft is a business. They all make a lot of garbage, they all make a lot of good stuff also. The purpose of a business is to profit, to further their own growth and make their share-holders happy. While it seems most of the other bigger publishers are content with releasing whatever whenever, EA seems to making the biggest push to expand their business model and bring their customer base with what it is we actually want - sweet, new games. But considering every interview I ever read with someone with Activision focuses on sales, I've seen ol' John here quoted numerous times as pointing to the actual ratings for the games being released under his watch... Interesting. Interesting indeed.

Inconnux
Inconnux

the riffraff will go bankrupt? hopefully this mean EA will file for bankruptcy soon... Substandard games? any game that includes Securom is substandard and I will be avoiding. This man is arrogant and one of the main reasons that EA is one of the most hated publishers/developers in the industry.

Sheik_Yerbouti_
Sheik_Yerbouti_

'Riff-raff'? Substandard games? Yep, it's pot and kettle time.

truckerbozo
truckerbozo

P.S. In hoping that "the rifffraff" will go bankrupt, it merely reinforces our position to fill the shelves with our own "riffraff". After all, whats a new fiscal year without another Maddon or NBA Live to gouge consumers with! hahaha... Ya'know, I almost feel sorry for our competitors. We are like WalMart, we're so big you can't ignore us even while we sell some of the worst crap. Hey, did you hear this one... Gamer goes into a store and while looking to buy a new game, somewhere buried behind all of our game boxes they find something like GTA 4, MGS 4, Gears of War, WOW, Halo 3. Wait a minute! This isn't very funny! They can't buy this other stuff! We have Dead Space right? What do you mean it's the only new IP we've had in years? Gamers don't want new they want roster updates! And what's this Street Fighter 4 business all about? We're just going to have to buy these companies and put them in our family tree. What? You mean we tried that with Take 2 and it didn't take huh? Hmmm... I think the rest of the comments went something like that.

totaleklypse
totaleklypse

one more thing. according to DICE a game made by a small previously unknown studio won more awards for gaming in one year than EA has in probably the last 4. nuff said. little guy 8 - EA well who cares

totaleklypse
totaleklypse

he must think we have all forgotten about how a developer he would classify as riffraff made a football game that completly made a fool of EAs "top seller". so the giant bought out the rights to an entire league. that contract is about up isnt it? or how they buy out great properties from such riffraff then taint it with the slime of rehasing and pointless changes and expansions. yea thats right. UO would be a prime example. alls you are is a white collar pimp...or john if you will, of other peoples ideas. then when a competitor trumps you, you cry foul and buy something out. maybe yours is one of the positions EA should slim down. you sir have more fat in your head than the entire industry has. i say thank you to all the riffraff that bring the hopes and gambled ideas to the table. that riffraff sir is where most of the new great ideas and genres emerge. last i checked the only games flooding the store shelves are rehashed need for speeds, maddens, overpriced expansions etc etc.

kardon16
kardon16

im still waiting for a crysis 2 announcement

Caer_Death
Caer_Death

Every time there's a major economic downturn, the population learns to be smart with their money. After a few generations, it tends to be wiped clean, but hopefully investors and bankers won't be so inclined to be lend-happy with only a small hope for a return.

Hellbishop
Hellbishop

I agree totally. The current economic crisis will get rid of the excess fat and recreate a lean mean game industry machine where a quality diet instead of fast food tripe will rule once again. Good to see Mr.Riccitiello tell it like it is.

SEEDman_X
SEEDman_X

Ah!! I don't even know where to start criticizing this moron!! "Cut headcount, close facilities, and reduce creative risk" are the exact reasons why EA got to where they are today. Speaking of the substandard games, just about half of them were published by EA. In brief, I say you have to be a dumbass to take advices from one of the least liked game studio!

HeadrockBeats
HeadrockBeats

@ Thibbledorf: I couldn't disagree more. In the past year the only game I bought was Spore. Spore! How terrible is that!! Seriously - have a look at Gamespot's own Top 10 for the past 12 months: http://www.gamespot.com/games.html?type=top_rated&platform=5&mode=top&sort=score&page_type=games&dlx_type=all&date_filter=12&sortdir=asc&official=all Most are either sequels or expansions, and aside from Mass Effect (Bioware's golden touch there) and Dead Space (which I hear is pretty good) most of these will probably be forgotten within a year or two (how long does it take before a WoW add-on is replaced?). Fallout 3 was a total sham, and I spend most of my time waiting eagerly for Empire: Total War just to get me out of replaying older games (fortunately, I have many). Compare to 2002 - I bought around 25 different games that year, and IIRC I enjoyed the vast majority of them. That's a good year, and it doesn't even come close to the spectacular ratio of good-to-bland games in the late 90's. So forgive me if I don't agree at all, but 2008 was probably the worst year in games so far, possibly even worse than 2005. We're in a downwards spiral here, and not for an overabundance of developers, but rather by the quick death and sellout rate of those developers by massive companies like EA and their ilk.

HeadrockBeats
HeadrockBeats

@ Lamprey (if you're still reading): I wrote in my blog that I thought EA did have some nice successes (probably should've acknowledged that here as well), but it's a matter of ratios - they can't accuse anyone of flooding the market with crap if that's exactly what THEY'RE doing, with a few good games here and there. The vast majority of EA releases is either expansions to their games, or unimaginative static noise. So yes, kudos on their few true successes, but shame on their CEO's arrogance. In the 90's EA used to make some of the best games in the world, and pretty consistently at that. Then they started inflating like all other industry giants, and nowadays they're so full of hot air they can say stuff like "We want monopoly" without batting an eye. And they're actually doing it too - just have a look at the sheer number of developers they've bought out in the past few years. Letting BioWare do whatever they want is hardly compensation for all the developers who've been turned into mindless money-making factories by EA - hell, do you know ANYONE who could tell BioWare what to do? They're the best developer out there after all. But a publisher that can take on small developers and let them do what they want - THAT would make a lively industry. Unfortunately, that is absolutely NOT the description of today's game business, nor will it be if EA gets what they're asking for.

flawless_blade
flawless_blade

"because it's difficult to compete with shelves choked by substandard games. " eh... dont most of those "substandard games" come from EA? and i think the only reason they aren't dead yet is cause they're one of the largest gaming companies and already have their back pockets lined with greasy and fat-arse-sweat-soaked cash already. bloody stupid giant corporations.

Saije
Saije

Arrogance, thy name is Riccitiello. I'm all for being the badass evil overlord, but try to use a little more tact will you. Though I'm sure verbally cementing your position as dominant in a tough economic environment didn't hurt the stocks.

thibbledorfP
thibbledorfP

There is a lot of shovelware on the Wii, and some on other consoles and platforms. But his implication was almost that small companies are makers of inferior games and larger ones make the better games. This is wrong, as many times it can be the opposite scenario. I personally think that this time is the golden age of gaming. There are very few crap games coming out on PC, XBOX360 AND PS3 IMO, people are demanding decent storylines, graphics and gameplay in games. There are a lot of average games, but there always were. I personally think there are bucketloads of good games coming out compared to other eras.

codename-60091
codename-60091

oh yeah... and i will be more than glad to dodo all the new upcoming EA games. besides, almost all of the one that i have now are pirated. woohoo

xeoneex66
xeoneex66

I find it funny that he comments about little minor companies by calling them "the riffraff" and "substandard", when those very companies helped to build the megacorp known only as Enormous A-holes AKA EA. I'm outraged by the fact they swallowed up Pandemic and BioWare, but the fact he's basically calling those types of companies riffraff and substandard is just downright evil and arrogant. I'd love to see what would have happened if EA didnt leech there way into the gaming world. Sickens me now that the only real competition for gaming companies is big megacorps like activision and yes even they are getting to big for their own good. They are destroying companies like Blizzard and some of the online games like World of Warcraft are going into a direction that alot of people are starting to deem unworthy to be put into the category as a good game anymore.

mastiffchild
mastiffchild

I don't think he's slating small companies at all really. He makes sense with his statements to me and EA will streamline to concentrate on new IP alonmgside their established money makers(FIFA etc). His main point is really one that the quality is the the one thing that decides success in a market driven by economic reticence-less money means more choosy gamers. People look at what they're spending on when times are tight so good quality is the way to ensure good sales and returns on your investments so the "riff raff" as he put it(prolly meaning Wii shovelware and rushed cheaply made HD titles)will go to the wall. But not because the company is small.

khariss
khariss

allot of people have already made good points about the small company's releasing the good games. bizarrely enough he is right about this bin a big chance for company's but he missed out that they are gonna replace ea (someday).

GodLike500
GodLike500

"Substandard Games"? Sounds like he's describing most of the crap that EA has released in the last 5 years. Outside of Dead Space, EA is notorious for releasing one uninspired game after then next.

snarple_basic
snarple_basic

This guy only believes in big companies, its really sad. The small company is usually the company that tries to do things different and more creative then your giant's like EA and Activision. Bankrupt the little guy and we'll be given only bland EA sequals year after year!!!

Oncus
Oncus

Substandard games? Riffraff? Those are not the only games that will leave the shelf. It is sad that when a smaller company makes a good and original game (better than some EA's games) it doesn't always become popular because they are not as well known as EA is, and it gets ignored. And the as economy stands now, there will probably be less original games because the smaller companies (that can create good games) won't have enough funds to realize an idea or compete with advertising or graphic quality of bigger companies. I don't see how narrowing choices down to games of well known companies is a good thing.

drangel_jam
drangel_jam

I couldn't agree more with him. The recession is also a chance for Americans to realize that they need to change their glutenous ways of credit cards and general mass consumption of things (energy, water, gas, clothing, food, etc...)

Cabal23
Cabal23

Thin the herd? Last time I checked the herd is almost extinct. The sub-standard games are coming from big game companies, not small ones.

SWT2008
SWT2008

These are incredibly selfish statements hes making. SO what if these other companies are making low-quality games? AT least they are making games, and at least those designers, programers, producers, and developers of those games have jobs! I'd take junk games over no games any day.

atopp399
atopp399

Quality? Nope, EA's games are junk a lot of the time. New IP's? Nope, EA pretty much only likes games that can be milked each and every year even if they suck and are based on name only. There are a few diamonds in the rough but there is definitely a lot of rough. Gaming as a service? You mean like the SecuRom service you morons attach to your games? He really shouldn't be talking about substandard games. EA has some of the worst games out there.

jimbob_1977
jimbob_1977

Hang on..the EA CEO talkes of shelves choked by substandard games? Does he include the extremely substandard 'must be released by the holiday season' NFS series in this? I doubt it! I agree with his comments that a lot of the weaker companies will go by the wayside and that in some instances I guess that this does make the industry more streamlined but it is some of these studios that can offer the truely unique IPs that breath new life into a lot of the stale, tried and trusted, games that the big boys such as EA and Ubi tend to release like clockwork on an annual basis. Hopefully, EA will look at creating more genuinely unique games like Dead Space and Mirrors Edge and not just sequels to these titles which, whilst not to everyones taste, at least they both offered something different last holiday.

the_real_VIP
the_real_VIP

Man, comparing EA and Capcom's strategies, Japaneses are about keeping it balanced and in-budget whereas Americans go "Losing profits? Cut! Losing profits again? More cuts! Still losing profits? RESTRUCTURE, in other words, bigger chunks of cuts!"

lamprey263
lamprey263

@HeadrockBeats yeah, I agree with you, I think small studios are where some of the best ideas come from, they have that ability to take more of that gamble with their ideas, that's not to say that's always a good thing, but some good ideas do come from them, and as for big companies, there is a problem of a formula taking effect, though I do like that some companies like EA have at least attempted to do unconventional things and try to develop new IPs and expand old ones, I thought Mirror's Edge was a good example of a big company trying something new, and I thought they did a great job, I also thought the same of Dead Space since I can't think of many survival horror games that didn't come straight out of Japan, and I thought this one beat the pants off a lot of them in the genre, though I think they're not thinking right with regards to these new IPs, EA has a problem of thinking every title needs to be a cash cow, it's too bad they haven't realized that they their developers did a fantastic job here just because it didn't produce as much revenue as say maybe a Sims game or a Madden game they release like clockwork, and I've a fear they won't ever attempt these kinds of great games unless they can live up to those standards some companies got the formula thing down, some in a good way, some in a bad way, I'm kinda sick myself that there's those rhythm games that over-flood living rooms with peripherals every year, that's already too formula IMO, then again there is formula's like Activision being able to put a fresh Call of Duty game out every year and doing a good job at it, it did kind of get old when COD3 hit (wasn't bad, wasn't great) but Modern Warfare changed it up pretty good, and even World At War didn't feel like just another WWII game as they finally changed theaters of war for once, maybe this series will eventually get old but they've been putting these games out annually since 2003, each time keeping high standards, and they've at least a few more years in them

lamprey263
lamprey263

@WizengamotX - "I hope Monolith chokes on F.E.A.R. 2: Project Origin. As the above article details, "the EA CEO said that when the economy turns south, the first things accountants say to do is cut headcount, close facilities, and reduce creative risk. If the problems persist, the advice is to do more of the same." Monolith followed this strategy with wit." Monolith Productions has made some excellent games in the last few years, they came out with FEAR 1 & 2, Condemned 1 & 2, Tron 2.0 and AVP2, and with a consistency for positive critical reception, that says something about the quality of their titles and the talent that comes from such a small development studio. If there's any room for complaint it's over the multiplayer, which was never any reason to buy one of their games, though I have to admit the survivor mode on AVP2 multiplayer was among one of my favorite multiplayer modes. Sure they're not the most highly rated games to ever grace this earth, that doesn't mean they're not good by any means.

PandaBear86
PandaBear86

John Riccitiello is much better than the previous EA president, thats for sure. He allows BioWare to develop free from upper management. Lets just wait for Dragon Age and see.

HeadrockBeats
HeadrockBeats

@ Lamprey: The reason those excellent bargain bin games didn't get the attention they deserved is usually the fact that industry powerhouses flood the market with advertising for anything they make, including the latest clone of their latest clone, which wasn't worth much to begin with. Lack of competition will make that even worse - we'd all want to see the big publishers fighting each other by trying to release higher quality games, but anyone who still expects that to happen has obviously not been on this planet for the past 8 years. If anything, there will be even more crap coming from companies like EA, after they buy up all those "riffraff" companies and pay them salaries to keep producing no matter the content value. Seen it before, will see it again. More developers, more publishers, more content; if nothing else then through sheer volume, we would end up with better games. Several large publishers? They'll squash any chance by any independents to produce games that don't fit the tried-and-true formula that corporations love so much.

WizengamotX
WizengamotX

I hope Monolith chokes on F.E.A.R. 2: Project Origin. As the above article details, "the EA CEO said that when the economy turns south, the first things accountants say to do is cut headcount, close facilities, and reduce creative risk. If the problems persist, the advice is to do more of the same." Monolith followed this strategy with wit.

Pete5506
Pete5506

In some ways he is speaking the truth

lamprey263
lamprey263

One benefit, he [John Riccitiello] said, is that a lot of "the riffraff" will go bankrupt. That's a positive event in his eyes because it's difficult to compete with shelves choked by substandard games. well, I actually like some of those games that not everyone else likes, eventually when I play all those must haves everyone is raving about and still need something to play I've often dipped into the bargain bins for new experiences and have often found great games gone long ignored by lots of people, it's kind of sad too because some games really deserve attention they never got.. then again, I have played a lot of crap and there's reasons it gets ignored, at the very least, as far as John Riccitiello is concerned, it cuts down on the competition which for him is a good thing, and I guess I can sorta understand where EA is coming from because in 2008 they had a fantastic year with almost all their new IPs like Army of Two, Bad Company, Dead Space, and Mirror's Edge, but they didn't get the sales they wanted due to the competition... but I must say, the 4th quarter 2008 competition wasn't over substandard games, most of the anticipated games this year actually turned out to be really good, which looking back many times when lots games get released at the same time some of those games are crap so people usually go and just pick up the good ones, but this last year all the games in 4th qtr '08 were awesome, it was competition at its finest

KhanhAgE
KhanhAgE

Could EA please remove DRM from the PC games they sell at retail stores. I rarely buy their PC games because of this.

HappyBB
HappyBB

"When the economy turns south, the first things accountants say to do is cut headcount..." WTF!! Did those accountants include themselves in the headcount reduction list!? You cut others' jobs to save your asses. What a bunch of nice guys!! Man, EA's staff reduction, as well as M$'s really piss me off as these mega companies make a lot of money. I am sure they have enough resource reserves to survive this economic crisis, but they have to get rid of those who contributed their lives for the companies' success just so the companies' earning will look good. Sigh..., the [beep] evil capitalism!!