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Rovio lays off 110 people as Angry Birds hype fades
- dabeeeenster 12y agoIs it just me or do these companies tend towards having a single massive hit, growing too quickly on the hype and then getting into trouble? Rovio, King, Zynga... Wasn't Angry Birds Rovio's 54th game or something like that? Suggests that it's almost impossible to predict/curate a huge hit game... I was really tempted to short KING when they floated.
- lingoberry 12y agoI don't know why they all make the same mistake of hiring literally a thousand people after their one big hit. Only Mojang seems to have kept small enough to sustain themselves in the long term.
- jahnu 12y agoI guess it's not a mistake if you are a highly paid CEO with shares that grow exponentially in value as your firm does. Exit quick or at least sell off some of those shares before it goes to hell and then move on to your next job having "been at the helm of a company with thousands of employees". Maybe I'm too cynical.
- vidarh 12y agoPresumably often they are intentionally bloating when they have a hit to attempt to milk it for all its worth while they can, exactly because the big hits are so rare.
- Cthulhu_ 12y ago> Suggests that it's almost impossible to predict/curate a huge hit game... It is. Just like whether a startup succeeds, or whether a stock will rise or fall in price. It's all a matter of flinging stuff at walls and if something sticks you got lucky.
- simonswords82 12y agoHonestly I think there's a bit more to it than that, but you're right that there's still an element of luck!
- kokey 12y agoThat's very common in industries dominated by hits, breakthroughs and inventions like entertainment, biotech or pharmaceutical. When you have a hit, you throw a big portion of the money you make from that at attempts to have another hit before the money runs out.
- lentil_soup 12y ago"Rovio still plans to release an animated Angry Birds film in 2016" I really fail to see what they are trying to do with this. That game has hardly any "story" behind it and the characters are not really that interesting. I know they're trying to push a brand but all this random stuff they're making around it comes across as bland.
- inDigiNeous 12y agoThey said they were going to be the next Disney. Maybe they are trying to follow that path with just this one big hit product, and failing to see that it's not really the same time as when Disney managed to build their brands.
- lentil_soup 12y agoYeah, I see what you mean. I must say I don't know much about the history of Disney, did they push their brand so aggressively at the beginning? or was it more "organic"? Thinking about that, it is interesting that Disney doesn't make movies with their traditional brand characters any more. Maybe because of those characters lack a bit of depth for a full blown movie? (like Angry Birds)
- TelmoMenezes 12y agoTraditional Disney characters are very popular in Europe in the form of comic books: http://en.wikipedia.org/wiki/Disney_comics http://en.wikipedia.org/wiki/Disney_comics I grew up with these books (I am Portuguese and we got the Brazilian ones) and the stories have much more depth, and the universe where they live more continuity than you'd might expect. This format is still very popular in France and Germany, for example. But not in the USA. I never quite understood why.
- Cthulhu_ 12y agoThe Disney comics are very much 'slice of life' mixed with comedy; the stereotype I have of US comics is that they're action comics, mostly serious business (and explosions), and not a strong basis for comic comics (geddit). I grew up with the weekly Donald Duck comics, <3.
- inDigiNeous 12y agoI've been hearing from friends who have worked close at Rovio that the real talent has been fleeing from there for some time now already, and they have been attracting people who are attracted to money, which is never a good sign for sustaining business, as the creativity might be killed in the process. Not sure if this true, would love to hear some more insight into this from insiders or people who know more. Might the same kind of hubris that Nokia had when they become #1 and they just couldn't innovate anymore as the diversion between the paycheck of the leaders and the normal workers became too big, and the thought process was "Were number one, why try harder, our product is best!". The same thing can be seen with Rovio, pushing the same shit down throats of people in new packages. Seems this model of creating success is not just working in the long run, maybe we should be thinking about building sustainable businesses and not just rewarding those running the company in a huge way, creating feeling of envy, hate and other stuff that can be also seen in the whole 99% vs 1% thing going on.
- deleted 12y ago[deleted]
- tomp 12y ago> they have been attracting people who are attracted to money, which is never a good sign for sustaining business, More accurately, it's not a good sign for a business to attract people not driven by it's primary product. Rovio's product is games, so ideally they would attract games-driven people, not money-driven people. On the other hand, investment banks have been working quite successfully for decades by attracting money-driven people, but then, their main business is money, so...
- somehnreader 12y agoHave they been successful? They did risky things and pocketed the winnings themselves in good times, with the taxpayer paying the losses when everything came down. I am not saying banks are not needed, and I am not running around with a tinfoil hat, but saying that investment banks are 'working quite successfully' might be a bit of a stretch.
- butwhy 12y agoIt always surprises me when layoffs are this large. I would have thought the business would slowly scale down to keep up with business cessation. Guess it would be more awkward to fire people one by one for redundancy purposes.
- kcorbitt 12y agoI dunno, I would hate to work for a company where one of my coworkers disappeared every two weeks, and you never know if you'll be next. At least this way after the big layoff those who are still around don't have to be looking over their shoulder quite so frequently wondering if they're the next one to go.
- Juha 12y agoIn Finland it isn't that easy to fire people one by one from permanent positions when it's not related to employee's performance. Company can offer good exit packages to ask people to leave (x months of salary), I believe this is what Nokia did at some point. In general it's normal to do big layoff rounds that involve proper announcements and negotiations between company and employee-representatives.
- SeanDav 12y agoAs someone who went through a process of constant threat of redundancy over many years - it is far better for employee morale to just do a bulk redundancy process, rather than dribs and drabs. Living with the prospect of every day not knowing if this was the day you lose your job, when so many friends had already lost theirs, is highly stressful and demoralizing.
- vidarh 12y agoIf you give people the idea that more firings are coming, you'll also see many of your best performers leave first, because they have the easiest way out.
- shangaslammi 12y agoAt least here in Finland it is much, much easier from a regulations perspective for a company to fire a bunch of people all at once rather than just few at a time.
- brunnsbe 12y agoOne has to take into consideration that Rovio isn't today just a game company, half or even more of their income comes from franchise products like e.g. angry Birds soda and clothes. I have a friend who works as their soda manager dealing with worldwide agreements with softdrink companies to produce Angry Birds soft drinks, not exactly a job you would find in most game studios.
- ctdonath 12y agoThat's just milking a popular novelty for what it's worth while you can. Duff Beer could have some staying power from its Simpsons connection, but Angry Birds soda is just not compelling.
- Cthulhu_ 12y agoTo you maybe, but what about fans that see it in the stores? Don't underestimate the imagination and enthousiasm of the younger generation, when it comes to Angry Birds, Minecraft, modern Lego, and franchises like that. Dismissing a successful business because you're not into it is just a bit shallow-minded (or elitist).
- qq66 12y agoThe bottom line is that a single previous success is not indicative of likely future success when creating new things. If you create something like Facebook, that's fine, because you can monetize the core product indefinitely. But when you create a game or a movie or a hit song that has a limited lifespan, there's very little indication that you can do it again. Once you churn out a long sequence of hits like Disney, you can claim to understand the process, but until then you might have just done the right thing at the right time.
- 72deluxe 12y agoI am surprised they employed that many people! What did they all do? They can't all be working on pig noises, bird noises and basic physics simulations can they????
- dagw 12y agoRovio has been trying for at least a couple of years to break out of their Angry birds rut by developing and/or publishing bunch of different games in various genres. Unfortunately for them it doesn't seem to have gone that well.
- aleem 12y agoSales primarily. Moving merchandise globally, signing royalty deals and partnering with carries for app bundling deals is the crux of their business. Software (and other intellectual properties) don't quite have the same supply-side economies. Once the game is done, you can make a sequel or variations with little effort. The rest is just about how many copies/downloads you can move. Or how many partner licenses you can sign. Really, it's all just profit after. I had one person within Microsoft put it as: On that first CD Microsoft ships, it writes off a few billion dollars in losses. After that every Windows license is just pure profit.
- Mahn 12y agoIf you have the money, you can hire people that are extremely specialized in specific areas, for example you may have a team of 5 people that is specialized on constantly analyzing and optimizing landing pages, or another one that studies only app usage in the first 3 hours after install, etc. These are not generally teams you would want assemble for a startup, but people who have years of expertise in very specific fields tend to be better at it than generalists for obvious reasons. You can do successful mobile apps wth 3 people, but if you can afford it and if politics/bureaucracy doesn't get much in the way, it can be worthwhile to have a larger team of specialists.
- lamuerteflaca 12y agoSounds like a waste of money. If you are making lots of money then it may seem like no big deal. Rovio, can no longer afford it of course. I'd rather hire 5 more developers to work on a new game.
- knappador 12y agoRovio still plans to release an animated Angry Birds film in 2016. We might be over-milking this one as a society at that point. I would put my money on... something else, specifically just not more Angry Birds.
- niklas_a 12y agoAnd just three years ago people wrote things like this: http://scobleizer.com/?p=7382 http://scobleizer.com/?p=7382 "It isn’t hard to see how they would become the coolest social network within a month or two. Even cooler than Quora. Heheh. After all, a lot more people identify with Angry Birds than identify with other services online (the same exec told me they can’t keep Angry Birds merchandise in stock). "
- pasiaj 12y agoSome people here are saying the company made big mistakes with their strategy, growing the company too fast, etc. They pulled in 400M+ of revenue out of a game where you launch birds at piggies using a slingshot. I think they did some things right. The lifetime of a company has been getting shorter and shorter for centuries. Mobile applications, games especially, are the new extreme in that development. These companies have a very limited lifetime. It is only natural that companies in this industry expand rapidly, face the limits of their growth, and then start shrinking. The idea of lifetime employment is long gone. After Rovio dies, theres a Supercell or a Mahjong spewing up somewhere else.
- ebbv 12y ago> The lifetime of a company has been getting shorter and shorter for centuries. Really? Because Apple was founded in 1976 and I'm guessing they aren't going anywhere. Google was founded in 1998 and I don't think they're going anywhere. Your assertion is really flimsy, and I think based on seeing a large number of mismanaged companies that flare up and die quickly and then concluding this is normal or even unavoidable. While it may be common, that doesn't mean it's what has to happen. Rovio took their success and drove it into the ground. They absolutely saturated the market, coming out with new Angry Birds games and tie ins almost constantly and flooding store shelves with very low quality (and in my area, often dingy) plush animals, further lowering public perception of their brand. I'd argue that if Rovio had been more judicious with their successful IP, that public interest in it wouldn't have disappeared so completely. You seem to be arguing that the fade was unavoidable since Angry Birds is just a game where you launch birds at pigs with a sling shot. But that doesn't mean the follow up games needed to be. Super Mario Bros was just a game where a guy jumps on things. Now I'm not really saying that Angry Birds was necessarily an IP with as much legs as Mario, but I think they burned it down. Rovio chose the short term, maximum immediate profit path, and now we're seeing the result of that. Zynga did the same thing. When you go all in immediately, and don't think about what is best for your long term, you burn out public interest in whatever you have to offer. When you don't take the time to make what you're putting out compelling, people will start to conclude everything you have to offer is just going to be more of the same. And they'll be sick of it. This is not the only path available, and asserting that it is just the way things are now is ridiculous.
- yock 12y agoI remember paying for Angry Birds to remove the ads, then one day sitting down to play only to find that the ads had returned. Hit game or not, too many moves like that point to cultural problems not easily fixed with money alone.
- spacehome 12y agoMy first guess would be a bug.
- jussij 12y ago> hype fades You mean like other over valued IPOs like Twitter and Facebook, that in time will also fade away?
- DigitalSea 12y agoRovio are one hit wonders. Not trying to be cynical or hate upon them, that's just how it worked out. They got lucky with Angry Birds, but failing to produce any new IP was their downfall. It's like a movie studio releasing the same movie over and over again expecting it to break box office records and be profitable. Sure people might go and see the first two sequels, but eventually people will grow tired and stop caring. This is what happened with Angry Birds. They had some great licencing deals, one of those being Star Wars and made a heap of money off of merchandise. This is the problem with most app companies these days. They build a successful app, it is popular for a few months and then people stop caring. Draw Something, Words With Friends, Flappy Bird, the list goes on. People have short attention spans. Would Nintendo still be around today if they kept on making sequels to Super Mario? Probably not. Rovio tried to squeeze Angry Birds too hard and lost. All they did was continually rebrand the same game with the same mechanics and changed a few of the game assets.
- brianwawok 12y agoExcept Nintendo DOES keep making sequels to Mario, and they keep selling. The difference is they release every few years, and fill in the gaps with other stuff. Not a new angry birds clone with new graphics every 3 months.
- inDigiNeous 12y agoYeah and the big difference is that the new Mario or Zelda is going to Innovate in new ways that nobody else has done before. Think Super Mario Galaxies, Zelda Ocarina Of Time, Windwaker and so on. Always new gameplay mechanics and most importantly, fun! Although the newest Zelda on the Wii was kinda meh, haven't played it though yet so hard to say.
- waylandsmithers 12y agoPerhaps the better analogy would be if Nintendo just continued releasing new levels for the original Mario Bros for NES. Technically Super Mario 64 is some sort of sequel, but it's clearly an entirely different game.
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- sk2code 12y agoThe gaming market is pretty dynamic and it is very hard to keep up with your competitors. People do play games but I don't know many people who keep playing the same game every day. Angry Birds came up with different versions of the game but the game dynamics never changed. You were still shooting pigs with birds, be in space or on mother earth. Some how these game companies have lots of loyal followers. I visited NASA (Cape Canaveral) last month and there they have a separate section in the NASA facility to attract kids with Angry Birds (Space version). Pat on the back (pun intended) for people investing so heavily in these gaming companies, when everyone knew that there is going to be another game coming out soon which will rock for few years before dying.
- mcphage 12y agoI just hope that they release a sequel to Bad Piggies. It's a very different style of game from Angry Birds, and is quite fantastic.
- fonnesbeck 12y agoI would still play Angry Birds if it did not continually pester me for in-app purchases. I'm probably not alone in dropping it for that reason.
- ShannonSofield 12y agoMy dog's Angry Bird squeaky toy I picked up in the bargain bin is the only one she hasn't tried to tear apart.
- joeld42 12y agoRovio was one of the few big mobile gaming companies that favored the cheap, not free pricing model for games. When that model collapsed, they got hurt by it. Still, i'm very impressed that they were able to take a hit that could have evaporated in a few months, and turn it into a pretty solid IP. Angry Birds might not be as big as a Disney brand or something, but it's still doing good and can support movies and merchandising. In the long run, those characters and creative IP could far outlive the game itself.