Don't miss
  • 12
  • 6468
  • 6097
  • 20

As EA loses more executives to start-ups, is this the beginning of the end for major publishers?

By on June 22, 2009
Print Friendly

The trickle of senior executives from major games companies to startups is threatening to turn into a torrent. Are the days of megalithic publishers numbered?

Playdom logo

EA COO John Pleasants has quit his job to join Playdom as CEO.

He is not the only senior executive to leave a major publisher in recent weeks. Simon Jeffrey left his job at Sega of America to become head of the new publishing division at ngmoco, an iPhone publisher founded by former EA-man Neil Young.

Venturebeat compares the shift from EA ($4 billion in revenue, 9,000 employees) to Playdom (“tens of millions” of revenue, 65 employees) as like President Obama quitting to become mayor of Las Vegas. I’m sure that’s tongue-in-cheek. For a start, It’s more like Vice-President Joe Biden quitting rather than the Commander-In-Chief himself. More importantly, Pleasants gets to be the top dog in Playdom and is likely to have a large chunk of equity, which has the potential to grow massively if he delivers on the company’s promises. EA’s days of stratospheric growth are behind it.

Other commentators have asked what is behind the exodus of senior executives from major games publishers to new startups. Is it because the difficulties of turning a supertanker-sized publisher around as it navigates the tricky channels and narrow shoals of digital distribution is a hell of lot harder than creating and leading a nimble and disruptive startup?

Of course it is harder. I believe that David Gardner and Phil Harrison at Atari have already suffered from this issue: the challenges of turning Atari around have proved a distraction, I think, from the plans to build a new kind of online games business.

Not all of the traffic is one-way. Activision is investing in Internet/digital talent and recently tapped former Yahoo [COO] Dan Rosensweig to head the Guitar Hero division.

But as the pace of change in the distribution landscape increases, I think that many senior executives at traditional publishers will find their fiefdoms shrinking and their jobs getting tougher. At that point, leaving the struggling supertanker to join a fresh-thinking startup may be a very appealing prospect.

UPDATE: Electronic Arts has gone on a PR offensive, telling Venturebeat that EA had decided to re-hire John Schappert (John Pleasant’s predecessor who defected to Microsoft 18 months ago) and “when we informed John Pleasants of this, he elected to pursue another opportunity”. Truth, or EA’s PR machine desperately spinning into gear?

About Nicholas Lovell

Nicholas is the founder of Gamesbrief, a blog dedicated to the business of games. It aims to be informative, authoritative and above all helpful to developers grappling with business strategy. He is the author of a growing list of books about making money in the games industry and other digital media, including How to Publish a Game and Design Rules for Free-to-Play Games, and Penguin-published title The Curve: thecurveonline.com