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Windy City studio the second operation to be shuttered in third-party publisher's round of consolidations, layoffs.


Last week, Electronic Arts CEO John Riccitiello announced in a quarterly earnings conference call that the publisher would be weathering a round of layoffs and studio closures. At the time, the only operation confirmed for closure was the EA Chertsey studio in the UK. Today, GameSpot has obtained an internal EA memo stating that EA Chicago is also being closed.

EA Chicago is best known for its work on the Def Jam and Fight Night franchises. It had been working on a new licensed Marvel fighting game, as well as a second fighting game based on a new intellectual property. The Fight Night series has already been moved to an EA Sports studio, and an EA representative said that announcements would be made regarding EA Chicago's other projects in the future.

The memo, sent by EA Games president Frank Gibeau, states that EA will announce the closure today, and calls it "the toughest decision I've made in my career--one that in no way reflects on the talent and dedication of the people who work there." Gibeau singled out studio general manager Kudo Tsunoda as one of the best creative minds in the industry, and said that many of the affected employees will be offered jobs at other EA locations, with those leaving the company receiving severance and outplacement assistance.

"We're willing to take risks, make long-term investments, and to support teams and individuals between launches," Gibeau said. "But each team is responsible for staying on a reasonable path to profitability. Sticking to that strategy is what gives us the financial resources and flexibility to take risks on new projects.

"Unfortunately, EA Chicago hasn't been able to meet that standard. The location has grown dramatically in the past three years while revenue from the games developed there has not. The number of employees has grown from 49 in 2004 to 146 people currently in the new facility in downtown Chicago. As it stands, EA Chicago has no expectation of hitting our profitability targets until FY2011 or later."

Gibeau stressed again that the company was willing to take risks and make long-term investments, but added every game must "be committed to delivering a reasonable expectation of profitability" if the company's corporate philosophy is going to work.

"It's a performance commitment that binds us together and ensures we have the resources we need to invest back into our people and creative output," Gibeau said.