2/6/2001
Gaming companies restructure in an attempt to attain profitability
More and more UK gaming companies are restructuring their organizations as capital markets dry up.
In order to attain profitability, two-year-old Gameplay plans to reduce its staff by one-third, that is 275 jobs, and close all eight UK shops and six websites. BarrysWorld was recently liquidated. Established privately held companies like Warwickshire-based Codemasters, have also dramatically reduced both UK and overseas staff. A press release issued by the firm stated that due to the current market conditions the firm had to reduce operating expenses and staff. 90 staff members were told to go. Even Eidos, the UK?s largest video-game maker, is tightening its belt. The company recently delayed the release of three new games, and for declared falling revenues and wider losses from the year-ago period, ending September 2000.
As demand slows, game makers, in particular those exposed to the US economy, will continue to feel the crunch. Restructurings will occur more frequently as the leisure and entertainment sector are always among the hardest hit in a slowing environment.
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