600 Laid Off At Blizzard

Blizzard announced today that in order to “address the changing needs of our company,” 600 people will be laid off in “overstaffed” areas of the organization. CEO and cofounder Mike Morhaime said that only 10% of the layoffs will come from game development roles and that current release and development schedules will not be affected.

“Constant evaluation of teams and processes is necessary for the long-term health of any business. Over the last several years, we’ve grown our organization tremendously and made large investments in our infrastructure in order to better serve our global community. However, as Blizzard and the industry have evolved we’ve also had to make some difficult decisions in order to address the changing needs of our company,” said Morhaime in a press release today.

The “changing needs” most likely refers to the fact that their longtime cash cow of World of Warcraft has been slowly bleeding users since October of 2010 (going from 12 million to 10.3 million this past November), and that the 90% of non-development roles being let go are probably in customer service and technical support. I’m not trying to belittle the impact this has (after all, 600 people just lost their jobs), but know that Blizzard is hardly in any sort of trouble. Considering that they hired 1,000 people in 2010 to add to their 4,600 total of 2009 and that they’re still hiring developers, I’d say it’s safe to say most of the 600 were tied to the upkeep and maintenance of WoW.

Of course, this makes you wonder if the BlizzCon cancellation is related in any way. The World Championship is more or less taking up some of the community slack, but what if it was about the money? Knowing BlizzCon runs at a loss, perhaps not even cutting that was enough to keep margins up. But then again, this is the company that racks up tens of millions of subscribers to their MMO each month and develops one of the most successful RTS and e-sports franchises out there in StarCraft.

Source: Blizzard press release via Business Wire

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