C&C Labs News Wire

— Wednesday, January 29, 2003 —

Posted By: Mike at 3:02:32 PM ET

EA to Merge WW, EAP, LA studios

I could have started this post off with the title "The End of Westwood," but after thought, I've released it's about perspective.  Anyway, now that I've got your attention, I might as well start from the beginning.

Today Electronic Arts posted its earnings report, a good one I might add.  Here's a clip from a Smartmoney.com article:

For the quarter ended Dec. 31, the videogame maker late Wednesday reported net income of $250.2 million, or $1.69 a share, compared with $132.3 million, or 92 cents a share, a year earlier.

Revenue soared 48% to $1.23 billion from $832.9 million.

When releasing fiscal second-quarter results in October, Electronic Arts projected third-quarter earnings of $1.52 to $1.60 a share on revenue of $1.08 to $1.18 billion.

That's the good news.  The rest of the article is fine as well, until you reach the abrupt and unexpected final paragraph:

The company's earnings target doesn't include studio restructuring charges, which are still being determined. Electronic Arts said that in the current quarter it will begin consolidating its Los Angeles, Irvine, Calif., and Las Vegas studios into one major game-development studio in Los Angeles.

What does all this mean?  It means that EA has decided to merge (combine, consolidate if you will) its Los Angeles, EA Pacific (Irvine, CA), and Westwood (Las Vegas) studios into one single LA studio.  (Note that I've also seen more likely reports that EA's WW consolidation will begin in the 4th quarter, not this quarter.) But wait, that's not all.  A Reuters article quotes EA CFO Warren Jenson as saying 50 jobs will be cut in this line:

On Wednesday the company also said it planned to consolidate studios in Los Angeles, Las Vegas and Irvine, California into a central Los Angeles studio. Jenson said about 50 jobs would be cut as a result.

It means the end of Westwood Studios and the short-lived EA-Pacific as we know it.  What isn't certain is exactly what jobs will be cut and whether games will continue to be published under the name Westwood Studios.  Who knows, at worse-case it could even mean a near-approaching end to CNC.  But remember everyone, it's all about the money.  That's why there's still a good chance that games will continue to be published under the name Westwood Studios, one of the most recognizable and respected in the gaming industry across the globe.  Change isn't always a bad thing though.  In any case, it's a sad day, and things will certainly be changing, for better or for worse.

If you want to join in on the discussion, Maniac has started a thread about this merger on the Official Generals Forums.  Here is the link to the thread. (At least right now it can still be considered a thread... in a few minutes, who knows.)

I'll be keeping you updated as more information arrives.