The state of the industry: Economics, Development issues and human welfare.

[Squilliam]

Sorry Al-Strong: I thought I might run a test thread to see how it worked out.

This thread is inspired by a post Joker made in the old multi-platform development issues about staff turnover, losing experienced developers, inexperienced staff and poor industry working conditions.

We have recently had a small wave of layoffs cross the industry. EA (Still!) losing money every quarter it seems, Activision managed to post a loss even with the cash-cow that is blizzard making up half the revenues. I really don't understand why/how this could be happening at this stage of the generation. We've had a huge increase in games sold in the last 12 months over the previous 12 and yet it doesn't seem like enough.

Is this situation just waiting for a big Christmas season to fix or is there a deeper systematic issue in the industry causing problems for everyone? '

So have human conditions improved any from two years ago? I guess everyone in the industry will say they are over-worked and underpaid, but are they less over-worked at least?

 

[Graham]

Firstly, I know basically nothing about this at all. Which makes me totally unqualified to answer, but I will anyway.

I would guess that the money problem is not so much sales, but investment. Any big project will need capital of some sort to get it going and growing. People pour money into something if they think it'll do well.
In the current environment though, this isn't really happening. 18 months ago it was a comparative piece of cake to get multiple millions of investor dollars.

This is reflected in the stock market. EA's share price has dived over the last few months. That is a huge amount of money being pulled out of the company. A year ago, they were over $60/share, now they are ~$23.

The company I work for is doing it's first ever round of investments for a couple of projects we have been prototyping for over a year. Even though we have a sponsor lined up, most of the paths to market sorted and last financial year saw 200% growth it has been incredibly hard for the boss to sort this stuff out - it's taking a very, very long time.
Investors are freaked out right now. Badly. And that means money isn't moving, or it's being pulled out.

I didn't touch on the human conditions part, that I really do know nothing about

 

[Cheezdoodles]

This is reflected in the stock market. EA's share price has dived over the last few months. That is a huge amount of money being pulled out of the company. A year ago, they were over $60/share, now they are ~$23.

First of all, stock price diving has nothing to do with money being pulled out of the company. It only means that the marked values the stock lower based on lower expectations etc, money is not pulled out of the company.

Stock price by itself doesn't mean all that much on a daily basis unless your a stockholder or in upper management (because your hired by the stockholders, and they want you to maximize their return.)

Secondly, prior to September-October, the stock was between 45-50. It tanked down to $23 because of the global liquidity crysis, not because of EA themselves. Allmost all stocks have been halved in value during September-October.

Investors are freaked out right now. Badly. And that means money isn't moving, or it's being pulled out.

Money is still moving, investors just transfer the money into other precieved safer investments. There is a problem getting founding, but money is still being moved, just not in the direction that could benefit say, EA.

 

[Graham]

Haha ohh dear. I really did make a fool of myself last night.
That'll teach me for posting at 2am.