http://blog.wired.com/games/2008/02/riccitiello.html
EA's CEO: How I Learned To Acquire Developers And Not Screw Them Up
By Chris Kohler February 08, 2008 | 1:34:44 PMCategories: DICE 2008
LAS VEGAS -- Electronic Arts CEO John Riccitiello is very sorry about what happened to Bullfrog. And Westwood. And Origin Systems.
""We at EA blew it, and to a degree I was involved in these things, so I blew it."
In his presentation kicking off the final day of the DICE Summit, the head of the videogame superpublisher acknowledged that his company's previous strategy of acquiring talented developers just didn't work. But these days, even as EA and its competitors swallow up more and more developers in the race towards consolidation, Riccitiello thinks things are working out right with companies like Bioware and Maxis, by letting them keep their corporate culture.
Riccitiello said that the company's "one-management-size-fits-all" mentality with its acquisitions in the past only stifled creative freedom. "When I talked to the creators that populated these companies at the time, they felt like they were buried and stifled," he said.
Electronic Arts acquired Bullfrog, creators of acclaimed strategy games like Populous, in 1995. By 1997, the group's star creative talent, Peter Molyneux, had quit.
"Creative teams can be thought of as flowers in a hothouse -- you move the temperature up or down a few degrees and the flowers will die," he said.
The fear that talent will flee a studio, leaving no value left in the business, is "well-founded... it's exactly right," said Riccitiello.
"The command and conquer model," he said, "doesn't work. If you think you're going to buy a developer and put your name on the label... you're making a profound mistake."
The EA top executive's speech focused on "the new economics of game development," telling the audience that he would put forth a "new model" of "how publishers and developers can work together in the future" to solve issues like rising development costs, consolidation of the industry, and creative failure like EA experiences.
Riccitiello joined Electronic Arts in 1997 as the company's president, after stints at PepsiCo and Clorox. He left the company but returned this year, and quickly restructured the company into four different "labels," each with its own leadership: EA Sports, EA Games, The Sims, and EA Casual.
Riccitiello inherited a company much different than the one he started at in 1997. A decade ago, he said, you could make a triple-A game with a team of about 35 people. Today, he says, it's more like 200, after totaling up outsourced art, voice talent, and technology.
Electronic Arts also publishes games on 12 different platforms in many countries, adding cost of localization and porting the code. As an example, Riccitiello said that FIFA Soccer 08 shipped on eight platforms, 16 countries, 20 languages, and totaled an astonishing 94 separate SKUs.
Riccitiello said that consolidation -- big publishers buying up smaller developers -- is an inevitable consequence. He showed a series of slides that illustrated just how many different developers have been bought up by publishers like EA and Activision.
"I think that there's going to be fewer major publishers in 2010 than there are today. I think the second-tier players are going to thin out pretty significantly. The market share controlled by the few major publishers is going to be greater in 2010 than it is today," he said.
Riccitiello says that EA's "label model" presents solutions to many of these issues. Developers can be a part of a larger organization and not have to fear going out of business, but since EA doesn't "meddle" in their corporate culture, it allows groups like Maxis and Bioware to retain their unique goals.
Riccitiello called it the "city-state" model.
EA's CEO: How I Learned To Acquire Developers And Not Screw Them Up
By Chris Kohler February 08, 2008 | 1:34:44 PMCategories: DICE 2008
LAS VEGAS -- Electronic Arts CEO John Riccitiello is very sorry about what happened to Bullfrog. And Westwood. And Origin Systems.
""We at EA blew it, and to a degree I was involved in these things, so I blew it."
In his presentation kicking off the final day of the DICE Summit, the head of the videogame superpublisher acknowledged that his company's previous strategy of acquiring talented developers just didn't work. But these days, even as EA and its competitors swallow up more and more developers in the race towards consolidation, Riccitiello thinks things are working out right with companies like Bioware and Maxis, by letting them keep their corporate culture.
Riccitiello said that the company's "one-management-size-fits-all" mentality with its acquisitions in the past only stifled creative freedom. "When I talked to the creators that populated these companies at the time, they felt like they were buried and stifled," he said.
Electronic Arts acquired Bullfrog, creators of acclaimed strategy games like Populous, in 1995. By 1997, the group's star creative talent, Peter Molyneux, had quit.
"Creative teams can be thought of as flowers in a hothouse -- you move the temperature up or down a few degrees and the flowers will die," he said.
The fear that talent will flee a studio, leaving no value left in the business, is "well-founded... it's exactly right," said Riccitiello.
"The command and conquer model," he said, "doesn't work. If you think you're going to buy a developer and put your name on the label... you're making a profound mistake."
The EA top executive's speech focused on "the new economics of game development," telling the audience that he would put forth a "new model" of "how publishers and developers can work together in the future" to solve issues like rising development costs, consolidation of the industry, and creative failure like EA experiences.
Riccitiello joined Electronic Arts in 1997 as the company's president, after stints at PepsiCo and Clorox. He left the company but returned this year, and quickly restructured the company into four different "labels," each with its own leadership: EA Sports, EA Games, The Sims, and EA Casual.
Riccitiello inherited a company much different than the one he started at in 1997. A decade ago, he said, you could make a triple-A game with a team of about 35 people. Today, he says, it's more like 200, after totaling up outsourced art, voice talent, and technology.
Electronic Arts also publishes games on 12 different platforms in many countries, adding cost of localization and porting the code. As an example, Riccitiello said that FIFA Soccer 08 shipped on eight platforms, 16 countries, 20 languages, and totaled an astonishing 94 separate SKUs.
Riccitiello said that consolidation -- big publishers buying up smaller developers -- is an inevitable consequence. He showed a series of slides that illustrated just how many different developers have been bought up by publishers like EA and Activision.
"I think that there's going to be fewer major publishers in 2010 than there are today. I think the second-tier players are going to thin out pretty significantly. The market share controlled by the few major publishers is going to be greater in 2010 than it is today," he said.
Riccitiello says that EA's "label model" presents solutions to many of these issues. Developers can be a part of a larger organization and not have to fear going out of business, but since EA doesn't "meddle" in their corporate culture, it allows groups like Maxis and Bioware to retain their unique goals.
Riccitiello called it the "city-state" model.
