• EA stock drops, CEO John Riccitiello thinks investors are confused about gaming
    61 replies, posted
[quote] EA stock has hit a 52-week low point, now trading for $11.28 per share, and CEO John Riccitiello has some theories for why that may be. In a recent 15-minute interview with CNBC, Riccitiello explained that investors were simply confused by the state of the industry -- the gaming industry, that is -- and understanding its current stage. No new consoles have been announced yet, and in the meantime, investors aren't entirely willing to hop on board the social and mobile gaming train. "After many years of stellar growth, we more recently got into a place where I think investors are having a hard time understanding where growth in the industry is coming from. We're at a point where the new console generation is not yet been fully announced, so people don't know what's coming there. "And they're unclear about ongoing growth in the Facebook platform for gaming and mobile. So we're sort of in a transition period from an investor perspective." So what we end up with is a bit of a waiting game. Riccitiello goes on to say that the whole situation makes no sense to him, that investors are afraid of the gaming industry as it is. To him, the industry is still alive and kicking. "It makes absolutely no sense to me, but fair and unfair doesn't have anything to do with it when it comes to a stock. There is a perception among investors that the game industry is tough to invest in right now. They're looking for the winners and they're looking for the catalysts. I think those will take place over the next twelve months." Not that Riccitiello thinks the social gaming scene is a sure win. While the cost of making social and mobile games is generally much lower than the major blockbusters on console and PC, winning over an audience can be incredibly costly. He attributes this to competition, something that the social-mobile market certainly isn't lacking in. "I would argue that that's one of the worst thoughts I've seen in the gaming industry. Yes, it costs less to produce a game for a social platform or mobile. It costs vastly more to find an audience. "When you've got 10,000 applications going up on a mobile network, standing out in that crowd is incredibly hard. If you don't have the network power of an EA or Zynga on social, it's virtually impossible for a consumer to find the product. Ditto with mobile. What we have the benefit of is brands like Madden, FIFA, Battlefield, Medal of Honor, and Need for Speed." When asked whether NPD figures may be to blame for the lull, his response seemed pretty dismissive. Riccitiello doesn't put too much stock in the numbers, and believes investors are too reliant on such reports. He cites PC gaming as evidence, noting that everyone assumed it was dying just a few years ago because NPD reports claimed it was on a decline, when it was in fact "growing through subscription, through microtransactions, [and] through download." [/quote] [url]http://www.neoseeker.com/news/19918-ea-stock-drops-ceo-john-riccitiello-thinks-investors-are-confused-about-gaming/[/url]
He doesn't really explain why he thinks investors are confused. This strikes me as him saying, "You don't want our stock? you just don't know what you're doing". However, his statement about investors being confused is right. Hence why valve has private stock.
I really hope social gaming doesn't become the new face of video games.
[QUOTE=A B.A. Survivor;36835606]I really hope social gaming doesn't become the new face of video games.[/QUOTE] It's already the face of video games aside from Battlefield/Call of Duty/Starcraft. Social gaming and casual games are the new mainstream part of video games.
Looks like a good time to start buying EA stocks because inevitably they will go back up.
Investors often know jackshit nothing about the videogame industry and only look at profits, but this guy is talking out of his ass in my opinion. A lack of new consoles shouldn't even be a concern, we haven't had new consoles in, what, five years? Of course we're anticipating a new generation anytime soon, but why should this stop people from making games for the current one? It's not like everyone's gonna abandon their trusty six year old boxes with tons of games and accesories on the first day the WiiU, Xbox 3 and PS4 come out.
[QUOTE=LoLWaT?;36835644]I also find it horribly ironic about how [U]EA is saying that people don't understand the games industry.[/U] Give me a break :v:[/QUOTE] EA has making a profit off videogames though dickmoves and a general lack of care towards the consumer down to a science actually
-sniped Might cause a shitstorm.
[QUOTE=Bletotum;36835583]He doesn't really explain why he thinks investors are confused. This strikes me as him saying, "You don't want our stock? you just don't know what you're doing". However, his statement about investors being confused is right. Hence why valve has private stock.[/QUOTE] No, he pretty clearly states that he thinks investors aren't buying EA stock because they don't know which direction gaming is going. No new consoles and the rise in social media gaming are two explicit examples he cites. [editline]19th July 2012[/editline] [QUOTE=doomevil;36835693]Really EA? Did that Worst Company Award or loads of hate didn't teach you anything this year? I think the only ones that are confused about gaming is EA(well obviously)[/QUOTE] He's a businessman. He's not going to address the public with a statement saying, "our stock sucks because everyone hates us." I don't like EA as a company, but everyone's riding the hate train pretty hard. This is a public statement from the CEO of EA; he's not going to admit the EA is some evil corporation. His job is to make profit and spew bullshit. Honestly, anything other than the latter would have been surprising.
Uggghh More talk about 'facebook gaming' and 'mobile phone' gaming. I'm tired of hearing about it as if it's a zero sum game. Which it's not.
[QUOTE=latin_geek;36835641]Investors often know jackshit nothing about the videogame industry and only look at profits, but this guy is talking out of his ass in my opinion. A lack of new consoles shouldn't even be a concern, we haven't had new consoles in, what, five years? Of course we're anticipating a new generation anytime soon, but why should this stop people from making games for the current one? It's not like everyone's gonna abandon their trusty six year old boxes with tons of games and accesories on the first day the WiiU, Xbox 3 and PS4 come out.[/QUOTE] Except people have been expecting a new generation of consoles for some time now. Really, the current generation of consoles have pretty much reached the point where they've fallen behind irreparably in terms of hardware when compared to PCs. My trusty six year old box has a 3.2 Ghz tri core and only 512 mb of ram. Hardware wise, it's an outdated POS. The lack of anything ready to replace it certainly wouldn't look good to someone outside the games industry.
They aren't confused, if anything they realize the shit you do and can forsee what's to come
[QUOTE=TheTalon;36835813]They aren't confused, if anything they realize the shit you do and can forsee what's to come[/QUOTE] I don't think it's just EA. I mean, barely anything of substance was announced at E3 this year. Microsoft still has its head up its ass and has no fucking idea what direction they want to go, and they keep talking stupid shit about tablets and touchscreens. Nintendo did fuck-all, and ubisoft was just weird. Exclusively software companies are really kinda getting the shaft here in the sense that no hardware companies are committing to a next gen console, and they really can't do shit, because if they start a project and have to rework the entire thing for a new platform it's fucked.
[QUOTE=iFail;36835880]I don't think it's just EA. I mean, barely anything of substance was announced at E3 this year. Microsoft still has its head up its ass and has no fucking idea what direction they want to go, and they keep talking stupid shit about tablets and touchscreens. Nintendo did fuck-all, and ubisoft was just weird. Exclusively software companies are really kinda getting the shaft here in the sense that no hardware companies are committing to a next gen console, and they really can't do shit, because if they start a project and have to rework the entire thing for a new platform it's fucked.[/QUOTE]Do people even remember if Sony had a press conference? Did they really do anything remotely memorable? Microsoft at least had the who touchscreen things going and a few new game announcements, Nintendo was building up a showcase of WiiU stuff, with certain unique works like ZombieU sticking out. What did Sony do though? I don't really even remember seeing any articles posted around here about it.
I think the problem with EA is that the guy running the scene is a businessman, a CEO, a guy who cares about money, not quality. Likewise, shareholders are likely to fuel the cashrun even more by demanding more releases in a shorter time, further reducing quality. The ones on top haven't produced a game in their life and only hire those who HAVE because of their sheer experience. I'm glad Valve doesn't work that way. Their businessman doesn't have shit to say about their games, only sales because that's his work of field. A chef should not tell a doctor how to do his work.
i'd pop 10 grand in EA if i could
[QUOTE=Recurracy;36836100]I think the problem with EA is that the guy running the scene is a businessman, a CEO, a guy who cares about money, not quality. Likewise, shareholders are likely to fuel the cashrun even more by demanding more releases in a shorter time, further reducing quality. The ones on top haven't produced a game in their life and only hire those who HAVE because of their sheer experience. I'm glad Valve doesn't work that way. Their businessman doesn't have shit to say about their games, only sales because that's his work of field. A chef should not tell a doctor how to do his work.[/QUOTE] Hardly relevant. Gabe Newell hasn't worked on the developmental side in a long ass time. He just hires people who fit in with the Valve ethos and buys up IPs from modders.
[QUOTE=iFail;36836181]Hardly relevant. Gabe Newell hasn't worked on the developmental side in a long ass time. He just hires people who fit in with the Valve ethos and buys up IPs from modders.[/QUOTE]The fact is that, even if he may or may not now, he actually did. In fact, he was a fairly major player even early on.
[QUOTE=Doctor Zedacon;36836193]The fact is that, even if he may or may not now, he actually did. In fact, he was a fairly major player even early on.[/QUOTE] I get that but what Valve does on the developmental side now has little to do with him. He's basically a talent scout and Valve's policy guy. He's not a dev anymore, and he knows it. His own bio says "His most significant contribution to Half-Life, the company’s debut title, was his statement: 'C'mon, people, you can't show the player a really big bomb and not let them blow it up.'" What he did a long ass time ago has pretty much nothing to do with Valve's dev team decisions now. I mean, he cultivates a great company mindset, but he's not the guy changing gameplay mechanisms and drawing concept art.
[QUOTE=iFail;36836255]I get that but what Valve does on the developmental side now has little to do with him. He's basically a talent scout and Valve's policy guy. He's not a dev anymore, and he knows it. His own bio says "His most significant contribution to Half-Life, the company’s debut title, was his statement: 'C'mon, people, you can't show the player a really big bomb and not let them blow it up.'" What he did a long ass time ago has pretty much nothing to do with Valve's dev team decisions now. I mean, he cultivates a great company mindset, but he's not the guy changing gameplay mechanisms and drawing concept art.[/QUOTE]No, he may not be actively developing them, but he still oversees things and ultimately can step in at any time if he wanted. But, as was the point originally, the fact is that he has actually worked as a developer before and knows the field. He's by far better suited for it than anyone else is because he actually understands how the job works.
The next xbox needs to come out sooner, It's painfully out of date.
[QUOTE=Doctor Zedacon;36836269]No, he may not be actively developing them, but he still oversees things and ultimately can step in at any time if he wanted. But, as was the point originally, the fact is that he has actually worked as a developer before and knows the field. He's by far better suited for it than anyone else is because he actually understands how the job works.[/QUOTE] I seriously doubt it. He's a smart guy, smart enough to not step in and fuck up what other people are working on. I mean, his game development roots seriously pale in comparison to those of the people he has working for him. I mean of course he's better than pretty much any other CEO in the games industry, but he doesn't make development side decisions anymore, because frankly, he knows other people can do that. My original point was that attributing Valve's success to Gabe's developmental history and EA's supposed failure to the lack of a game dev as CEO is a mistake. Having a one time game dev from Microsoft isn't going to ensure success. The reason Valve did so well was the acquisition of modders' IPs, Valve's company values, and forward thinking with Steam.
[QUOTE=iFail;36836322]I seriously doubt it. He's a smart guy, smart enough to not step in and fuck up what other people are working on. I mean, his game development roots seriously pale in comparison to those of the people he has working for him. I mean of course he's better than pretty much any other CEO in the games industry, but he doesn't make development side decisions anymore, because frankly, he knows other people can do that. My original point was that attributing Valve's success to Gabe's developmental history and EA's supposed failure to the lack of a game dev as CEO is a mistake. Having a one time game dev from Microsoft isn't going to ensure success. The reason Valve did so well was the acquisition of modders' IPs, Valve's company values, and forward thinking with Steam.[/QUOTE] That's kind of the point. Having been in the shoes of a developer himself at some point, he knows the conditions when a developer is at his/her best. This perspective translates into the Valve ethos, allowing them to land the proper decisions.
[QUOTE=rinoaff33;36835626]It's already the face of video games aside from Battlefield/Call of Duty/Starcraft. Social gaming and casual games are the new mainstream part of video games.[/QUOTE] How does anyone disagree with this? Gaming used to be a thing that nerds/kids did, now everyone from children to grandma play games in one form or another, because of things like phone and social media games like those found on Facebook. Oh, not to mention that the people I know who aren't into gaming, at the very least have EA sports titles and games like Call of Duty/Battlefield. I even work with a 70 year old that is obsessed with Call of Duty. If that's not mainstream, I don't know what is.
[QUOTE=just-a-boy;36836633]That's kind of the point. Having been in the shoes of a developer himself at some point, he knows the conditions when a developer is at his/her best. This perspective translates into the Valve ethos, allowing them to land the proper decisions.[/QUOTE] except the "valve ethos" is hardly game dev exclusive. Google has a fairly similar corporate identity as well. also, saying he's a game dev is a bit of a stretch. technically he worked on Half Life 1 and that's the only game he's worked on at Valve. I don't think he did a whole ton on Half Life 1 either, he himself disparages his contribution to the game, and if he was a really good game dev, I think he'd have worked on more projects at Valve. It seems to me that he worked on HL 1 because they were understaffed, and after its success, he didn't need to work on the developmental side anymore.
I think investors are getting too many farmville invites.
[QUOTE=Matt-;36835557]now trading for $11.28 per share[/QUOTE] Shit, how do you buy stocks?
Stocks and investors make for some of the easiest ways for big companies to get fucked over. There's a reason why companies like valve stay private; it's harder for a company not to go public (because they can get a lot of money doing so) but worth it in some cases. No wonder Apple has been buying back stock.
People are not buying EA because their business strategies are unsustainable.
It would be really damn good idea to grab some EA stocks right now. After BF4 comes BANG, stocks are up again.
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