Analyst: Weak Sales of Mirror's Edge, Rock Band 2 Could Mean More EA Cuts

By Nick Breckon, Dec 08, 2008 7:40pm PST Electronic Arts titles such as Mirror's Edge, Rock Band 2 and Need for Speed Undercover are expected to underperform this holiday season, and could spell more product and personnel cuts for the publisher, according to Lazard Capital Markets analyst Colin Sebastian.

"Specifically, we believe several EA titles are tracking below plan at retail this holiday, including Need for Speed Undercover (with disappointing reviews), new franchise Mirror's Edge, and Rock Band 2," said Sebastian, as relayed by Gamasutra.

Lazard predicts that a sluggish season could mean more layoffs for EA--in addition to the October 30 slashing of 600 jobs--and product cancellations, such as the company's recent termination of EA LA's Tiberium.

"Importantly, we believe EA is continuing to review its cost structure and franchise base, and it is possible that management will announce further cuts in headcount and the development pipeline (including existing franchises) over the coming quarters," added Sebastian.

While hard sales data of holiday titles has not yet been released, Lazard's "tracking" bills the aforementioned games as slower-than-expected sellers. However, Sebastian noted that Dead Space, FIFA 09 and Left 4 Dead have seen strong sales in spite of the overall disappointment.

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  • Game publishers got greedy and all decided to release their games in the holiday season to boos their sales. The money is tight among most people I know and you can't buy every game you set your eyes on. They probably should have released their games more sporadically throughout the year that way as people come onto cash they can easily come up with a game they have been eyeing for a little bit.

    I blame publisher greed, I highly highly doubt the developers really finished up all their games and went gold in the same 3 month window. If I want a game, it doesn't matter when it comes out for me, I will get it regardless, and I think that's the same overall consensus among most gamers, unless you do not have a job and must wait for the holidays to get video games presents. Last I remember reading the average age of gamers is around 32-35 so I don't think many adults will be asking their wives/girlfriends for video games. Even though I am guilty of it :-/ (I'm only 20!)

    Thread Truncated. Click to see all 2 replies.

    • Devs have schedules. They probably built a 2-3 year schedule that ended with them shipping during the holidays. As much as we like to trot out the 'when its done' stance, very few can afford to do this. The burn rate (how much it costs to run a modern/large development studio is simply too high.

      That said, publishers do spread out game releases intentionally. The holidays are the biggest purchasing time (or at least were - I don't have current data on this) but most publishers stack various titles to come out at different times of the year (ie a publisher doesn't want to put out multiple shooters that compete against themselves the same fiscal quarter).