restructuring
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Sega canceling games, cutting jobs in US and Europe to restructure [update: SOA statement]
Sega's forecasts for the fiscal year ending March 31 have been adjusted down -- expected net income is down 47.4% -- and Sega Sammy's board of directors have enacted a drastic plan to reduce operating costs in the future.Sadly, this plan involves the "streamlining" of Sega's operations in the US and Europe, to "create a smaller company positioned for sustained profitability." There is currently no word on how many jobs are being cut, or where, to create this smaller company.The plan also includes a narrowing of Sega's lineup, to focus on franchises that the company expects to sell in the US and Europe, including Sonic, Football Manager, Total War, and Aliens. That refocusing means some games have been canceled, though specific titles were not announced.Sega's "extraordinary loss" (caused in part by costs from this restructuring) will see the company's expected profits drop from 38 billion yen ($462 million) to 20 billion yen ($243 million,) with sales revenue dipping about a half-billion dollars. The cancellation of these projects and this reform is estimated to have a 7.1 billion yen ($86.5 million) price tag.Update: After the break, find Sega of America's full statement.
Sony gets a Kaz-style kick to its corporate guts, emphasizes its oneness
Kazuo Hirai doesn't officially grab the reins as Sony's CEO and President until April 1st, but in reality he's already at the stirrups. He's making a number of exec-level switches that he hopes will deliver "rapid and optimized decision-making processes as 'One Sony'." His strategy? An inner circle consisting of himself and fellow reformers -- such as CFO Masaru Kato -- who will engage with department heads and, you know, make 'em do stuff faster. Digital imaging, gaming and mobile will be considered pillars of the electronics business and receive more "concentrated" resources as a result. Meanwhile, Kaz will directly oversee the struggling TV business in an effort to turn it around, which means his days of enjoying life and staring out of windows are probably numbered. See the press release for more tectonic detail.
T-Mobile to eliminate 1,900 US call center jobs, says more 'restructuring' ahead
T-Mobile USA CEO Philipp Humm sent word to his employees today that the company will be shuttering seven call centers, cutting a total of 3,300 jobs in the process. Affected employees will have the option of relocating to any of the 17 remaining call centers throughout the country, where 1,400 new positions will be available, essentially bringing the net job loss to 1,900. The call centers affected include Allentown, Pennsylvania; Fort Lauderdale, Florida; Frisco, Texas; Brownsville, Texas; Lenexa, Kansas; Thornton, Colorado; and Redmond, Oregon -- so if you're based in one of those locations and want to stick with T-Mob, now would probably be the time to communicate your intentions. Other employees, including technicians and "front line" workers, will be able to stay put, though Humm did allude to further reductions, adding that "we will also be restructuring other parts of the company." You'll find the CEO's message in its entirety just past the break.
Nokia drops another 1,000 employees, Finnish plant focusing on software
To say it's been a rough year for Nokia would be a huge understatement. And things are only going to get worse before they get better. Case in point: the company just finalized an agreement to cut up to another 1,000 jobs (which we knew was coming), all at its plant in Salo, Finland. The cuts will not happen all at once, instead positions will be phased out over the course of the year, with most layoffs coming before the end of June. For those in Western Europe it's another batch of manufacturing jobs heading to Asia, for Nokia it's simply part of a restructuring plan designed to help it stop the bleeding. The staff that remains will focus on installing software that caters to European customers. After several quarters of bad news and then a complete shift in smartphone platforms it only makes sense that Nokia would find itself in dire straights. Still, in a country where unemployment hovers at around eight percent, we're sure no amount of national pride will make people feel better about losing more jobs.Update: In case it wasn't clear, we just wanted to clarify that these are cuts that Nokia had already announced. The company has simply struck a deal with its employees making the move official.
Elpida files for bankruptcy protection as debts of $5.5 billion are revealed
DRAM Maker Elpida has petitioned for a corporate reorganization (the equivalent of Chapter 11 or Administration) as the company has revealed it is close to collapse. President Yukio Sakamoto is expected to resign as the scapegoat for the calamity as it files for protection at the Tokyo District Court. The company, founded in 1999 as NEC Hitachi Memory Inc. has produced DRAM Products since 2000. It founded three wholly-owned subsidiaries: Tera Probe, which conducted wafer probe testing, Akita Elpida Memory Inc. which handled the back-end processes of DRAM production and Rexchip Electronics Corp, which handled the front-end. After a blockbuster period of invention, a fall in prices and the global recession in 2006 forced the company to enter restructuring with a 30 billion Yen ($372.54 million) Government-backed loan. That swathe of cash was used to pump more money into investment and R&D, but the combination of strong Yen and the Thailand flooding has once again forced the company to come clean about its finances. It revealed today that it had debts of 448,033 million Yen, or $5.5 billion and without the protection of the court wouldn't last too much longer. Times of Japan points to the strength of Samsung's memory offerings as being a big contributor to Elpida's collapse, with president Sakamoto saying that DRAM is now as cheap as a "rice ball."
Kodak gets court approval to borrow $950 million, end theater sponsorship
Kodak took another step along the road to recovery yesterday, after receiving court approval to borrow $950 million in restructuring funds. Nearly a month after the camera maker filed for Chapter 11 bankruptcy, US Bankruptcy Judge Allen Gropper granted Kodak's request on Thursday, allowing the company to continue operations during its ongoing transition. Gropper's decision, handed down in a Manhattan court, follows a series of negotiations between Kodak and its lenders, and adds an extra $300 million to the $650 million awarded during January's Chapter 11 filing. The company is also allowed to end its sponsorship of the Kodak Theatre in Los Angeles, after successfully arguing that doing so would be in the best interest of Kodak and its creditors. Under the deal, Kodak is obliged to pay $72 million over the course of 20 years. It currently shells out $3.6 million per year and still has $38 million in outstanding payments, but Kodak's lawyers argued that the agreement was too costly. Kodak Chairman and CEO Antonio Perez issued the following statement in response to yesterday's decision: "Today's agreement is another step towards ensuring that Kodak is positioned to execute on the goals the Company set out last month: Bolster our liquidity in the U.S. and abroad, monetize our non-strategic intellectual property, fairly resolve legacy liabilities, and enable Kodak to focus on its most valuable business lines."
Kodak files Chapter 11 bankruptcy, expects to complete restructuring by 2013
Apparently suing Samsung (again) wasn't the only pressing business for Kodak today, as it just announced it has -- as expected -- filed for Chapter 11 business reorganization in New York. You can read the details in the press release after the break or at the Kodak Transforms website, where Chairman and CEO Antonio Perez is quoted saying he hopes Kodak will "emerge a lean, world-class, digital imaging and materials science company". The company has obtained $950 million debtor-in-possession financing, which it claims will provide the liquidity needed to continue operations during the restructuring. As far as its recent parade of lawsuits against Samsung, Apple and HTC, Perez comments on "monetizing non-core IP assets" so we'd assume its lawyers will stay busy going forward.
Lenovo taps former Acer CEO Gianfranco Lanci to lead new Europe, Middle East and Africa division
It looks like former Acer CEO Gianfranco Lanci's recent gig as a consultant for Lenovo has worked out pretty well -- Lenovo confirmed today that it's bringing on Lanci in a permanent position as the head of the its new Europe, Middle East and Africa (or EMEA) division. As The Wall Street Journal reports, that move is part of a broader reorganization within the company (going into effect April 2nd), which will see it have four units focused on different regions instead of the current three. Current Lenovo execs will head up the three other divisions.
TomTom looks to shed ten-percent of workforce in restructuring effort
We have some sad news to report out of Holland today. TomTom has announced that it will release nearly ten-percent of its employees as the company works to reorganize and move away from the personal navigation device market. The struggling firm previously stated that it would trim €50 million from its annual operations budget, and many of TomTom's employees will now face the ramifications of this effort. Moving forward, the company will focus primarily on in-dash navigation equipment that's pre-installed by automotive manufacturers, along with fleet management for delivery companies. Hopefully we'll see some better times ahead for the Dutch firm. Frankly, we don't know what we'd do without the likes of Mr. T, Han Solo and Burt and Ernie leading the way.
Adobe to lay off 750 workers, restructure around digital media, marketing
The company made famous by the ubiquitous Flash Player and multimedia software like the Adobe Creative Suite has announced its plans to eliminate 750 full-time positions in attempts to reposition itself as a leader in digital media and marketing. In two separate press releases, Adobe gave a glimpse into the restructuring, which it will cover in-depth at a financial analysts meeting in New York tomorrow. The company expects the plan to result in pre-tax charges somewhere in the ballpark of $87 million and $94 million, a large chunk of which will come from expenses "related to employee severance agreements." According to one of the two press releases, the master of Flash plans to continue offering the Creative Suite as well as expanding "tablet-based touch apps" and cloud-based software. It's also promised to invest further in HTML 5 through tools like Dreamweaver, the recently announced Edge and PhoneGap, which it acquired with the purchase of Nitobi. Despite the shakeup, Adobe expects to meet its previous Q4 projections of between $1.075 billion and $1.125 billion. A bunch of corporate what-nots await you in the dual press releases after the break.
Gameforge laying off 100 employees, canceling at least two games
Another month, another round of MMORPG-related layoffs. This time the bad news comes courtesy of Gameforge, a German browser MMO maker responsible for Gates of Andaron as well as the upcoming Star Trek: Infinite Space and the European version of Wizard101. Gamasutra reports that Gameforge is realigning its studio to the tune of 100 layoffs and the cancellation of at least two games, with Hellbreed and Mythos on the chopping block and Star Trek: Infinite Space not far behind "if it cannot find a co-publisher." The company will do away with its web- and client-based games divisions and restructure itself around separate development and publishing arms. The news comes on the heels of layoff announcements by CCP, NCsoft, and GamersFirst last month.
The story of saving APB
While many of us are aware of the basics behind the rise, fall, and re-rise of All Points Bulletin, it's only been from a partial, fragmented perspective. GamesIndustry.biz conducted an in-depth investigation into the story of how GamersFirst swooped in to save the drowning APB, which barely had 130,000 registered users at the time of its shutdown last year. As the game and company went into administration, GamersFirst sent in a team to assess the title and see what could be done. The company decided to purchase it and convert it to a free-to-play model, although Bjorn Book-Larsson said that the price tag for the company was higher than initially anticipated: "It ended up not being a cheap deal for us, but obviously a lot cheaper than the initial development." In restructuring the development team, GamersFirst reduced the number of developers by 90% to make it more agile, often recruiting former Realtime Worlds employees who showed promise. "Our production designer used to be the lead QA person. He'd spent years taking notes on how things should have been different. Essentially, when I met him the first time he rattled off a huge list of what he thought should have been different. Just an insane amount. We just said, maybe we should just hire you as a designer," Larsson said. So far, it looks as though the restructuring and new focus is paying off, as APB Reloaded's beta is currently seeing five times as many players as those who registered for the box product last year.
Rumor: GamersFirst lays off 32 staffers, CFO [Updated]
If the rumors are true, today has not been the best of days for MMO industry staffers. Hot on the heels of our NCsoft layoff story comes distressing news for fans of GamersFirst, as we've just received an anonymous tip concerning the apparent dismissal of 32 people from the firm's west coast office. According to our tipster, "Most of the APB team was let go. A lot of the support staff was let go. The development team was not, to my knowledge, so the game is still being developed in Scotland." We've also been told that GamersFirst's CFO was let go. We've reached out to G1 for clarification on this story, and as of press time there is no official word on the staffing decisions or how the shake-up will affect Fallen Earth and the rest of the company's free-to-play lineup. [Updated: Reader alacritythief let us know that GamersFirst's Revoemnag and TechMech have responded to the layoffs in regard to APB's future. Their comments are just behind the break.]
Sony's TV reform to begin 'immediately,' could involve partnering with other firms
It's been a year. Particularly if you're Sony. The same company that's staring at a $171 million price tag due to an unforgettable PSN breach and a gamut of bad news detailed in its most recent earnings report is now facing the daunting task of reforming its flagging TV division. 'Course, Sony's still moving gobs of panels, but according to Chief Financial Officer Masaru Kato, "markets are maturing and price competition is stiff" in advanced nations. Mr. Kato recently spoke candidly with The Nikkei (linked below; subscription required), noting that the company is aiming to turn its TV business "into one that can be profitable even if we do not pursue volume." In order to do so, the entire platform is being looked at -- "no stone will be left unturned" -- and he even mentioned that partnerships with other companies will be considered. Oh, and if you thought you'd have to wait a quarter or two to see any changes, have a listen at this: "Even though we haven't yet decided how to announce the plans, they'll be implemented immediately." Attaboy!
New Acer will be more like Apple, less like HP
The details behind the rift that saw Acer's CEO Gianfranco Lanci (pictured) suddenly resign yesterday are now starting to emerge. Simply put, Acer's board wants the Taiwanese company to be more like Apple and HTC, according to Bloomberg, raking in big profits on fat margins. Lanci's approach, however, was to aggressively increase volumes and use its scale to negotiate cheaper prices from suppliers in a race to steal market share from Dell and HP. According to data compiled by Bloomberg, Acer's profit margin in the last fiscal year was just 2.3 percent compared to Apple's 21.5 percent. Daunting, to say the least. With Lanci gone, JT Wang, Acer's chairman and temporary CEO, plans to put more effort into expanding its smartphone and tablet business while broadening efforts around enterprise sales. For Wang, Lanci's departure marks a break with the past, saying, "Recently the iPad [tablet computer] and other new form factors have had a very big impact on the PC market. We have to change our business strategy." While PCs will still be core to the business, Wang said "we won't be in a hurry to change to become the world number one." Unfortunately for Acer, its brand is more closely associated with low-cost laptops than with the premium devices required to significantly expand its profit margins. We'd wish 'em luck but we think Acer will be better served by an innovative CEO and focused R&D.
Report: Rare replacing full-time artists with contractors
Edge reports that Microsoft's UK-based Rare studio is shifting from using permanent art staff to contract workers. According to Edge's sources, the studio is making a calculated move to narrowly dodge a "full consultation process" under European Union employment laws, whereby layoffs of twenty or more employees need to be announced at least thirty days before the first dismissal. Rare is reportedly in the process of cutting 19 staff, reducing its current art department of 42 employees to 23. The remaining 23 full-time employees (or fewer) -- supposedly more than 20 staffers have already taken the "very generous voluntary redundancy packages" -- will now fill new managerial positions, "in name or fact," according to a source, meaning that "the actual artists" will all be contractors in the future. The long term play here is to avoid paying wages during downtime (cutting contractors is a lot easier than laying off full-timers) and to wriggle out of pesky, strict European employment legislation. A contract worker needs two years of employment in a position to have the same rights as a full-time employee in the region. Now, we have to wonder: After all the artists are converted, who's next?
Second Life competitor Blue Mars drops PC development for Apple's iOS
If you were hoping that Blue Mars was going to rise to directly challenge Second Life's virtual world dominance, you may be in for disappointment today. In a letter to Avatar Reality's fans, CEO Jim Sink announced that the company is restructuring and dropping Blue Mars' PC development to focus solely on Apple's iOS. As a result, Blue Mars is now Blue Mars Mobile. "With over 50 million new tablet devices projected to reach consumers this year along with tens of millions of iPhones and iPod Touch devices, the market for Blue Mars Mobile is a massive opportunity for our company and our customers. We already have a functioning alpha in house and we aim to release the first builds of Blue Mars on iOS next month," Sink said. Sink also announced that a number of Avatar Reality employees, including himself, have been let go from the company. Unfortunately for PC users, Avatar Reality is limiting development to mere bug fixes for the forseeable future. While the company will not charge users of the PC client, there will also be no technical support for the user client.
Final Fantasy XIV team restructuring, PS3 version delayed
We've got bad news and we've got worse news. First, the bad news: The PS3 version of Final Fantasy XIV, originally due March of next year, has been delayed indefinitely. The worse news is that it's been delayed because the PC game is such a disaster. In an announcement released to the FFXIV community, Square Enix CEO Yoichi Wada apologized for the fact that the game isn't very enjoyable ... and then said that the FFXIV team is restructuring, with new leadership stepping in. Producer Hiromichi Tanaka is out, with Naoki Yoshida taking over as producer/director, and many other positions are also being restaffed. The new team is now working on "a concrete plan outlining Final Fantasy XIV's new direction." Until that new plan is implemented, the game's free trial period will continue. And so, with the PC version currently a directionless mess, Square Enix wisely decided not to base the PS3 version on that, but instead on whatever the post-restructuring game will be. There's good news, then: Square Enix stopped making what would have been a terrible PS3 game.
'Seasonal roll-offs' hit EA for third year in a row
Following scattered reports of EA layoffs on Twitter, Joystiq confirmed with the company this afternoon that "seasonal roll-offs" have begun in the wake of the publisher's holiday release schedule. EA corporate communication spokesperson Jeff Brown explained: "As you know, seasonal roll-offs that follow game launches are common and vital to maintaining a healthy business. Because so many of our games ship in the holiday quarter, the team size adjustments tend to follow in the same timeframe. However, EA is growing and several of our studios are looking to hire talented people." Notably, this is (at least) the third year in a row that layoffs hit EA in the holiday season -- also like previous years, we'll have to wait and hear more when the company speaks about financials publicly on its quarterly investor's call this November 2. For now, EA wouldn't confirm which studios or how many folks were being affected by the firings. As always, we'd like to extend our best wishes to all parties involved. If you'd like to share more information regarding the layoffs, don't hesitate to get in contact. Update: According to a report on Shacknews, "as many as 100 employees" have been affected thus far, with EA Canada and EA Black Box both specifically named. The NBA Elite 11 and Skate 3 teams are said to be hit hardest.
Realtime Worlds re-hires 23 MyWorld employees
The saga of Realtime Worlds continues, this time with a happy ending for 23 employees of the MyWorld project that were laid off earlier this month. In a press release from business restructuring firm Begbies Traynor, administrator Ken Pattullo lays out the details. "As a smaller entity, MyWorld is attracting considerable interest from potential buyers and 23 members of the team who had been working on the project clearly add value to it as a standalone business," Patullo said. In addition to MyWorld, a platform for creating social games announced earlier this summer, Realtime Worlds will continue to operate All Points Bulletin even as it looks to finish restructuring with an eye towards creating a company that can support the urban crime MMOFPS.
