Zynga has officially closed its Boston offices, laying off 5% of its staff in the process – continuing what seems like a downward spiral at the social gaming firm.
Other lay offs have been seen at the company’s Austin and Chicago offices, with threats that the UK and Japanese studios will also be up for a cut back. As part of the move, more than a dozen games have been cancelled as well.
The problem, as VG246 points out, is that the money making aspect of social gaming is struggling in general. The games that need you to spend a couple dollars here and there to get more “energy” on your farm or Facebook army so you can continue playing, aren’t attracting the numbers any more. If you’ve been playing for a long time, you know that you don’t really care enough to spend that money and if it is needed to advance, you’ll feel like the game is cheating you.
Zynga has attempted to diversify with “new” games that look suspiciously like those of other developers – but it’s been doing that forever. However it hasn’t helped the company’s downward spiral and neither has the fact that Facebook itself has continued to drop steadily since its initial public offering. The two are linked more than most online companies and as one falls it’s dragging the other with it.
It’s also having to face up to the might of EA games in the courts, after it ripped off Sims Social from EA developer Maxis.
Zynga is in real trouble.