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Analyst: Tiberium Cancellation Damages EA's Credibility
by Leigh Alexander
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October 8, 2008
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While Electronic Arts says it recently canceled Command & Conquer FPS Tiberium because its quality just wasn't up to snuff, Janco Partners analyst Mike Hickey suggests such moves may be cause for concern.
"Continued lack of management execution and/or product quality, damages new management’s credibility and dampens our excitement for the company’s shares," says Hickey.
At the time EA canceled the title, which had been in development at its EA Los Angeles studio, the company declined to disclose how much money it had invested and said it had no plans to specify its losses from the aborted project.
Hickey expects EA to lower its expectations for its fiscal year performance -- nonetheless, the analyst says he's still "cautiously positive" on the company's prospects, expecting strong performance from Warhammer Online and encouraged by new IP like Dead Space and Mirror's Edge.
Wedbush Morgan analyst Michael Pachter adds a different opinion on what the cancellation might mean for EA -- he says canceling Tiberium actually adds credibility for the publisher as far as concern for game quality.
"Canceling a bad game goes a long way toward preserving the quality of the overall lineup," says Pachter.
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On the other hand, it would seem more honourable if they finished the game they greenlit, then face the music. You started it, so man up and finish it.
Second, This title was messed up long before the new CEO and management team arrived. When they did, and the dust settled, they said they were quality focused. Canceling a game because it doesn't meet quality expectations after you say you are going to cancel games that don't meet quality expectations doesn't seem like it should damage credibility.
I agree. The cancellation is a fiscal and incredible loss of money. One poster claimed it was 40 million. Seems to me the middle managers at EALA are little slow to realize that burning through 40 mil is irresponsible.
Second if the new CEO being place was part of the cure, it was actually more than a 1 year the new CEO and GM were in place while Tiberuim was still running in production.
As it is, they still do not have 1 level completed from start to finish.
Irresponsible leadership, thus a loss of credibility.
Dont drink the kool aid bro, I was EA for 4 years and they had a new motto every quarter....
And then, they change for the dramatically better and start caring about making very high quality games (Deadspace and Mirror's Edge will be the major tests of this, I think)... and now they get crap for cancelling a title that, by all reports, was going to be terrible?
This GIVES them credibility, it doesn't damage it. This is a ridiculous story.