Earlier today we initiated a number of changes to streamline our operations, focus our resources on our most strategic opportunities, and invest in our future. We waited to share this news with all of you until we had first spoken with the groups impacted.
As part of these changes, we’ve had to make some tough decisions around products, teams and people. I want to fill you in on what’s happened and address any concerns you may have.
Here are the most important details:
We are sunsetting 13 older games and we’re also significantly reducing our investment in The Ville.
We are closing the Zynga Boston studio and proposing closures of the Zynga Japan and UK studios. Additionally, we are reducing staffing levels in our Austin studio. All of these represent terrific entrepreneurial teams, which make this decision so difficult.
In addition to these studios, we are also making a small number of partner team reductions.
In all, we will unfortunately be parting ways with approximately 5% of our full time workforce. We don’t take these decisions lightly as we recognize the impact to our colleagues and friends who have been on this journey with us. We appreciate their amazing contributions and will miss them.
This is the most painful part of an overall cost reduction plan that also includes significant cuts in spending on data hosting, advertising and outside services, primarily contractors.
These reductions, along with our ongoing efforts to implement more stringent budget and resource allocation around new games and partner projects, will improve our profitability and allow us to reinvest in great games and our Zynga network on web and mobile.
Zynga made social gaming and play a worldwide phenomenon, and we remain the industry leader. Our success has come from our dedication to a simple and powerful proposition – that play is not just something people do to pass time, it’s a core need for every person and culture.
We will all be discussing these difficult changes more with our teams and as a company. Tomorrow, Dave and I will be hosting a post-earnings webcast (details to follow) and next week we will be discussing our broader vision and strategy during our quarterly all-hands meeting. I’m confident this puts us on the right path to deliver on the promise of social gaming and make Zynga into an internet treasure
This seemed to have irked the internet group Anonymous as indicated by a youtube video which has now been removed. The video featured a self proclaimed Anonymous member threatening to target Zynga for unfair treatment to their employees.
Here’s an extract from the video:
Zynga customers and Facebook users, we are Anonymous. During the last few days anonymous has been targeting Zynga for the outrageous treatment of their employees and their actions against many developers.
We have come to believe that these actions of Zynga will result in massive layoff of a thousand people and legal actions against everyone that speaks to the public about this plan.
It will also come to end of the US game market as we know it as all this jobs will be replaced in other more convenient financial countries.
With a billion dollars cash sitting in a bank we do believe that such actions are an insult to the population and the behavior of corporations like Zynga must change.
Anonymous could not allow this to happen so it’s starting to release confidential documents we have leaked on this plan
As we speak we are planning to release also all the games we’ve taken from their servers for free.
That being said we will stop the idea of the distribution of such games if Zynga will cease immediately the plan.
Someone got hit badly, and probably wants to do some damage as part of the revenge. Zynga has been facing different forms of troubles recently and if these threats go true, it can affect the brand to a greater degree.