Nov 10

Electronic Arts, the Destroyer of Worlds, sets its eye on BioWare

by in Current Games

Ultima VIII introPictured above: ‘The Destroyer of Worlds’ holding the Avatar in the palm of his hand, in Ultima VIII: Pagan. It is no coincidence that Origin’s tagline was “We Create Worlds”.

In the excellent Escapist article The Conquest of Origin, writer Allen Varney paints a picture of the rise and fall of Origin Systems Inc., the creative masters behind series such as Ultima and Wing Commander. Throughout the article we are shown how Origin gradually loses its managerial and creative control as (in)famous publisher Electronic Arts asserts its corporate dominance.In the light of that story, I was concerned when I heard the news that local developer BioWare Corp. was purchased wholesale along with co-conspirator Pandemic Studios in an $855 million-dollar sale. The question resting on everyone’s lips was, of course, what does the purchase mean? Ray Muzyka and Greg Zeschuk seem to be claiming outwardly that the sale is the best thing for their company and that they “believe in [EA CEO] John [Riccitiello]‘s vision”. Others are more concerned about the purchase; there is no shortage of doomsaying, fear-mongering, and other generalized anxieties of EA.

The question is of course, how can we make some sense of the purchase? What might the purchase mean for the future of BioWare/Pandemic, the future of role-playing games, and PC gaming in general? In this article I try to make sense of the purchase by looking at some of EA’s corporate history, their modus operandi with the companies they’ve owned, and the vision that CEO Riccitiello has for the monstrous game publisher.

A Brief History of Electronic Arts

EA began its life as a publisher under founder Trip Hawkins, who envisioned a game publishing company that highlighted the independent developers prominently in games and promoted software as an “art” and not simply another consumer product. Hawkins himself had experience programming for games, and obviously recognized the artistic skill that went into game design and development. Under Hawkins, EA published an impressive library of games, including: M.U.L.E., Bill Budge’s Pinball Construction Set, Archon, The Bard’s Tale, Populous, Wasteland, The Immortal, Marble Madness, and The Faery Tale Adventure among many other classics. EA also built its own in-house development studio, mostly known for its sports games such as Dr. J and Larry Bird One-on-One, Bulls vs. Blazers and the NBA Playoffs, and the precursor to the now ubiquitous Madden series – John Madden Football.

By 1990, EA began porting its already award winning library of PC, C64, Apple, and Amiga games to the Sega Genesis and Nintendo Entertainment System. According to Gamasutra’s interview with Hawkins, the decision to begin developing and publishing for consoles was a major direction change for the company:

“It was very contentious because many employees and developers did not like consoles, or did not like action games,” he said. “The goal was to stop making esoteric products for an elite customer base, and go make it in the big-time with mainstream gamers. Several employees were outraged and quit, but I convinced the team that if the public chose to buy consoles like the Genesis, then to satisfy our customers we had to make the best games possible on the platforms chosen by the public, not the ones our engineers wished they could afford.” 

ArchonPictured above: Cover art from the classic Archon. Note the relative size between the developers’ names and EA’s logo. That size ratio will change, very very soon.

The move from the esoteric to the mainstream, as I see it, indicates a shift of understanding games as an art, to understanding them as a product potentially purchasable by a large audience. Although it may appear to be only coincidence, during this time EA also moved from the unique 45-rpm vinyl record album-style game cases, toward the traditional boxes we recognize today.

The Escapist article paints a much less sympathetic picture of Hawkins however,

As one example, EA had filed a frivolous lawsuit against Origin. Forced into a costly out-of-court settlement, Origin execs asked Trip Hawkins why he had allowed the suit; he responded, “This is just business. This is the way we’re going to win.”Furthermore, EA was all about marketing. For Hawkins the question was never, “How good is this game?” It was always, “How can we sell this?” 

The move toward developing for consoles also came with a shift in publishing strategy. If you examine EA’s software library from 1989 onwards (thank you Mobygames!) you start to see the first appearance of in-house developed sequels such as Skyfox II, Archon II, Starflight 2, Fountain of Dreams (sequel to Wasteland), Chuck Yeager’s Advanced Flight Trainer 2.0, and Skate or Die 2. However, it should be recognized that at least until the mid-1990′s the number of sequels EA developed was far outnumbered by the original titles it was publishing – this too would change as we will see.

It is in this time that Hawkins stepped down to found 3DO, and appointed Larry Probst as the new CEO of Electronic Arts. It might be surmised that Probst’s interests in video games only seemed to extend as far as their potential profitability. The following excerpt from an interview with Probst is rather revealing:

Q: Did you ever dream of making video games? Can you tell us how you got into this?

A: The answer is no because video games didn’t exist when I was growing up. I started my career in the packaged goods business. I worked for six or seven years for Johnson & Johnson and another couple of years for Clorox. The video game business started to emerge in the late ’70s with the Atari 2600. I was recruited into the business in 1982 by a company called Activision, which in those days was the Electronic Arts in the business.

Q: What game do you play most, and do you know all the cheat codes?

A: No, I don’t know the cheat codes. And to be very honest, I don’t spend a lot of time playing games. I spend a lot of time watching people play games. My most favorite games tend to be the ones selling the best at that moment. So right now, my favorite game is Fight Night.

Q: So you don’t play the games yourself?

A: Occasionally. I’m not somebody who spends 20 hours a week playing video games, but I spend a lot of time looking at products.

 

These quotes were not cherry-picked for mere effect: Probst has always shown a disinterest in video games as a medium, and treats them purely in terms of marketing and profitability. Richard Garriott said of Probst, “Larry Probst was often not supportive of the things I was doing, but I respect Larry because he was always clear, rational and consistent in his lack of support” – not quite the picture of a visionary publisher that one would hope for as a struggling developer.

The Acquisitions

Under Probst, EA began a series of high-profile development studio acquisitions that eventually led to the rather twisted and painful demise of Origin. Within months of acquiring Origin, the management at EA began putting pressure on the developer to meet corporate deadlines – a business practice that ultimately led to the publication of unfinished or unpolished games such as Ultima VIII and Ultima IX according to Garriott in the excellent book Dungeons and Dreamers. Small-profit or original (“risky”) games were categorically left unfunded by EA; blockbusters and sequels would only get green-lighted. In the end, Origin would close up shop – its staff had lost faith in the company as EA shelved or cancelled their projects one-by-one to focus on more financially exploitable sequels like Ultima Online 2. Many of the developers left for greener pastures, and Garriott himself finally left founding Destination Games which later partnered with NCSoft to create Tabula Rasa.

But Origin was not the only company acquired by EA. A year earlier Distinctive Software (developer of Stunts and Test Drive) had been purchased – the major deal struck a death-blow to already struggling rival publisher Accolade who now had lost one of their major developers. The studio was renamed to “EA Canada” and later became EA’s largest studio, employing over 1000 people. The studio would no longer produce any original titles, and instead became the developer of many of EA’s sports series, such as NBA Live, FIFA, NHL, SSX, and Need for Speed.

PopulousPictured above: You can practically feel Larry Probst’s fingers sinking into your heart, Indiana Jones and the Temple of Doom-style. (Box art for Populous courtesy of Mobygames)

In 1995, Bullfrog Productions (developers of classics such as Populous, Theme Park, Syndicate, Dungeon Keeper, among others) was purchased by EA. According to a Business week article,

After Bullfrog, the acquisitions went into rapid fire, at least one a year, nearly every year: Lost in L.A. developer Manley & Associates (1996); Maxis (1997); Westwood and Tiburon (1998); pioneering online developer Kesmai (1999); Dreamworks Interactive (2000); former Sega Sports studio Black Box (2002); racing game developer Studio 33 and PC port master NuFX (2003); Criterion (2005); and three more studios this year: JAMDAT Mobile, Mythic, and DICE. 

Of those companies, almost all would either close or be renamed under the “EA” umbrella, and few would continue to develop original titles in the spirit of their founders. Westwood and Maxis, famed for their originality and visionary game designs, were relegated to parts of the EA machinery that put out sequel after sequel based on the new intellectual property they acquired. Both of these studios would be eventually closed and their capital/human resources redistributed to other existing EA studios – Westwood was absorbed into EA Los Angeles, and Maxis was eventually absorbed into EA’s Redwood Shores HQ. Of the two companies, only SimCity developer Will Wright survives as a remnant of his company’s former glory.

EA Under Riccitiello

With the replacement of Larry Probst as CEO in 2006, there has been a brief glimmer of hope for EA. According to the New York Times, EA’s new CEO John Riccitiello has promised a whole new corporate structure and game development strategy,

“If the E.A. of four years from now isn’t a bunch of properties you haven’t heard of on a bunch of business models that aren’t familiar to you,” Mr. Riccitiello said, “and if most of them can’t be picked up the first time by your mother and she can’t have fun with it, we won’t be the company I want us to be.”  

In short, Riccitiello sees the future of gaming in the casual games sector – a relatively untapped audience so far, apparently due to the complexity of the current games. But what does that mean? Is Riccitiello serious about a move toward innovation and original titles?

Partly. And this is why it is important to understand his vision in terms of EA’s history. Riccitiello is in fact making the same decision that Trip Hawkins made back in the day – that in order to reach broader audiences (and higher market penetration; profits), EA had to open itself up to new territories. In Hawkins’s time it was video game consoles, in Larry Probst’s time it was corporate growth through acquisition, and now Riccitiello has recognized the financial potential of the casual gaming market. The “innovation” that Riccitiello envisions only exists insofar as it broadens the potential audience that can play games, and ultimately lead to even more market dominance by EA. Nowhere in his vision is a commitment to improving the overall quality of games for the sake of quality alone. Riccitiello, like Probst, was never a game developer nor gamer, and his interest in games is purely in terms of product marketing and sales. He’s a Coca-Cola salesman, through and through.

What kind of evidence do we have that Riccitiello will not change much about EA’s business strategies? The clearest evidence came from this week’s closure of the EA Chicago studio which was responsible for the original titles Def Jam and Fight Night. In an internal e-mail posted earlier this week, President Frank Gibeau (an old managerial holdout from the early Probst-led days) had this to say:

“Within the EA Games Label, we are committed to running each franchise and facility as a city/state, teams with unique creative identities as well as responsibility for product quality, ship dates and profitability….Unfortunately, EA Chicago hasn’t been able to meet that standard….Closing EA Chicago is the toughest decision I’ve made in my career – one that in no way reflects on the talent and dedication of the people who work there.” 

The ImmortalPictured above: Box artwork for The Immortal. Don’t fear the reaper – it’s just a job after all, right?

And, the same day, EA announced their quarterly earnings as well as the future closure of several of its other studios,

… EA’s Board of Directors approved a plan of reorganization on October 29th in connection with the reorganization of EA’s business into the new ‘label’ structure. Over the next two years, EA anticipates closing certain facilities, including EA’s studio in Chertsey, England; relocating and/or eliminating certain job positions… 

In response to the planned closures and losses, Riccitiello had the following to say:

“Our strategic priorities on quality, innovation and managing cost are showing progress,” … “Highly accessible new properties like Skate and MySims have broken through with consumers and EA Sports continues to deliver great experiences on every platform. We’ve also announced a restructuring as part of a plan to better align cost with revenues.” 

In short, it is clear that Riccitiello is following quite carefully in the footsteps of his forefathers and will do nothing to upset the corporate modus operandi that began with Hawkins’s move into console gaming. But how then do BioWare and Pandemic fit into this picture?

The Future of BioWare/Pandemic

From the preceding text, it should be clear that BioWare and Pandemic fit very well into EA’s ongoing plans for monopolization of all gaming markets. EA’s CFO Warren Jensen has said himself that BioWare and Pandemic are the missing corporate pieces that will allow EA to finally penetrate the RPG and adventure game markets; to him the acquisition is part of “an important step for [EA] in driving growth and profitability.”

The implication here, however, is that BioWare and Pandemic now face the same financial constraints that now-defunct EA Chicago faced under the EA Games label: produce something profitable, or we’ll shut you down. This should be especially worrying for fans of these companies – EA paid almost $800 million for the companies and will be looking to recoup these losses as soon as possible, especially given the recent financial strains I spoke of earlier.

While many hail BioWare’s upcoming Mass Effect as another must-be hit, it is very important to recognize that the company itself has had a major shift in its interests: Mass Effect will only be published for the XBOX 360. That choice should stand in particular contrast to BioWare’s long-standing commitment to publishing their games for both consoles and PCs. In essence, BioWare’s new console strategy (Mass Effect 2 and 3 have already been announced) fits perfectly into EA’s strategies: making old genres more ‘accessible’ and bringing them into new markets.

The following comment from an Swcollect mailing list subscriber also pointed out some potential problems that BioWare may face in the future:

Please don’t forget that Bioware’s “cashcow” had always been AD&D. When Atari got the rights of AD&D and gave them somewhere else (Obsidian, for Neverwinter Nights 2), the attention went elsewhere.[Knights of the Old Republic] was a decent profit as well, but will Lucasarts let Bioware keep the rights now that they’re part of EA? 

In that light, what kinds of outcomes might we expect in the next 5 years? Based on the account I gave earlier, some of the following situations are plausible:

  • EA will relocate either the Edmonton-based BioWare studio to Vancouver (merging into EA Canada), or collapse the Austin-based Pandemic offices into a nearby EA-branded studio, as part of their current financial restructuring plan.
  • EA may front large sums of cash to BioWare in the hopes of producing a mass-market subscription based MMORPG that directly competes with Sony and Blizzard’s blockbusters. If the project runs over budget, or takes longer than anticipated, BioWare/Pandemic will be held responsible for the overruns.
  • After producing a few lukewarm niche successes for the next 3-4 years, Riccitiello will become uneasy about BioWare’s financial output. The studio will be pressured to produce titles with shorter development cycles and wider mass-appeal. This is perhaps already congruent with their interest in publishing Mass Effect only for the XBOX 360.
  • If any of the aforementioned business techniques do not staunch the financial wounds, EA will resort to its default corporate behaviour and BioWare/Pandemic will be closed and their employees will be redistributed to other EA studios. The developers uncomfortable with EA will leave both companies and form their own rival studios focused on niche games, and join the industry ecology of upstarts-buyouts-shutdowns that has typified the gaming industry of the last 20 years.
Sonic RPGPictured above: The festering corpse of the Sonic the Hedgehod license was recently revived by BioWare who will be producing a Sonic RPG for the Nintendo DS.Image courtesy of House of Nintendo.

With that in mind, it is foreseeable that EA now has a potential timebomb in its hands. Of Mass Effect, Dragon Age, Mercenaries 2, and the unnamed MMO, only one of those games are sequels; the rest are original titles that have not yet been tested against a rather unreliable audience. Despite BioWare’s rather ardent fandom, their expensive Jade Empire project drew nowhere near the kinds of crowds that their Star Wars and AD&D-licensed games did. If Mass Effect or Dragon Age suffer from the same kinds of mediocrity, BioWare/Pandemic may in fact become an $800 million notch in EA’s bedpost. However, if any of these games meet even moderate successes it is quite clear that EA already intend to milk every sequel possible out of them – when has EA ever called it quits on a financially successful franchise?

In the end, I’m left conflicted with the way I’ve painted things here: if BioWare/Pandemic are financially successful their games will become increasingly mainstream and casual. However, if they do try to push innovation and originality and aren’t met with the kinds of profits that are expected of high price-tag budgets – EA will likely shut them down within the next 5-7 years.

8 Responses to “Electronic Arts, the Destroyer of Worlds, sets its eye on BioWare”

  1. From Matthew Gallant:

    What a fascinating article, I understand a little better now why so many people have a passionate dislike for EA.

    Posted on November 10, 2007 at 12:27 pm #
  2. From gnome:

    An excellent account of EA’s doings indeed and a more than sad forecast for two really interesting studios. Then again, allow me to believe that this is the unavoidable future of every developer growing too big. It’s capitalism’s iron laws you see…

    Posted on November 18, 2007 at 5:05 pm #
  3. From Keira Peney:

    A fantastic article, and certainly one that highlights the destructive nature of pursuing the highest profit margins. Any successful game immediately seems to spawn a sequel, and for the most part the quality drops. I understand the need to make a profit – it’s still a business – but I think large game companies need to mark a section of their budget for risky ventures. After all, it’s from the innovative games that come the unexpected smash hit. And encouraging experimentation can only be good for the industry as a whole.

    Posted on November 21, 2007 at 7:42 am #
  4. From chris:

    Thanks for the comments!

    -> gnome:
    You’re right – it seems that almost every game company seems to outgrow itself eventually. Part of the problem, I suspect, is that they want to make larger and more complex games that require a lot more investment and capital in order to make them… which means more shareholders, more staff, etc…

    -> Keira:
    Interesting idea. That’s certainly the approach that large film distributors have taken in the last 10 years – like ‘Fox Searchlight’, ‘Paramount Vantage’, ‘Sony Classics’, etc – they invest in more niche markets that typically involve indie filmmakers. The problem I see with this approach, potentially, is that these ‘indie arms’ of the majors can easily outperform and outpace the existing small indie distributors because the majors can just throw money at competitors. Worse, given EA’s classic strategy – they would likely just buy-out competing indie distributors and shut them down.
    So, if EA ‘goes indie’ – we should be worried I think. Regardless, I agree that experimentation is inherently beneficial – but unethical business practices aren’t.

    Posted on November 21, 2007 at 8:12 am #
  5. From gnome:

    Well, in a global society where everything is valued (by the decision makers at least) on a monetary basis, it does feel hopeless… Don’t think it has to do with games size though… The trend is pretty ancient…

    Posted on November 21, 2007 at 9:38 am #
  6. From The_Immortal:

    Nice….

    Posted on September 4, 2008 at 9:40 am #
  7. From neur0n:

    This is without a doubt one of the best articles i have read in a long time. Maybe ever.
    What I find unfathomable is that with so many studios acquired and destroyed by Electronic Arts, the general population has no earthly idea, that this is a company that shat on, and gleefuly crippled the development of our beloved hobby. With corporate efficiency.
    Gaming would have been much better off without these gnomes.

    Posted on May 16, 2013 at 5:36 am #

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  1. The Artful Gamer · Writing Worth Reading: Write the Game - January 27, 2008

    [...] Keira posted a comment several months ago in response to the rather dystopian sketch I scribbled of the BioWare sale, I accidentally overlooked her blog, Write the Game, until recently. A writer, musician, composer, [...]

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