About 1,300 of the freshly unemployed individuals will result from the full closure of some of EA's facilities. This will cost EA money at the outset, but they estimate that by dropping the facilities they stand to save about $100 million annually. According to EA CEO John Riccitello, the cuts are happening in "targeted areas," so the company can focus up on its bigger, more lucrative games.
EA has kept up well with the iPhone platform and has released some of its most popular titles to the App Store, such as The Sims 3, Rock Band, and Spore. Consumers still pay a premium price for them, however. For example, Rock Band costs $9.99 and comes with only 20 songs, and charges 50 cents for each additional song. Still, Rock Band ended up selling well, so maybe we'll be seeing more of EA in the App Store in the coming fiscal quarters.
EA also announced today its acquisition of Playfish, whose primary business is Facebook games, for $300 million. Hopefully out of the layoff ashes rises some brutally addictive social-based game for the iPhone.