
Zynga to Lay Off 520 Employees and shutter NY and LA Offices - _pius
http://allthingsd.com/20130603/zynga-to-lay-off-520-employees-18-percent-of-staff-and-shutter-new-york-and-la-offices/
======
x0x0
Good thing Pincus sold off a bunch of stock [1] -- $190mm worth [2]. Even
better, he sold it before the employee lockup expired [3]. Living like a boss
== fuck you money in the bank, instead of locked up in a company like suckers
(employees and investors). From the stock charts [4], it looks like it closed
opening day at $9.50, Pincus and insiders dumped at $12, and if you're a
regular employee w/ a 6mo lockup that presumably expired 16 Jun since the
company opened 16 Dec 11, you've never seen a price higher than $6.

ps -- dear employees and investors: your ceo dumping big blocks of stock is
probably a negative signal

[1]
[http://online.wsj.com/article/SB1000142405270230472440457729...](http://online.wsj.com/article/SB10001424052702304724404577299372042231462.html)

[2] [http://www.forbes.com/sites/nathanvardi/2012/10/05/zynga-
kee...](http://www.forbes.com/sites/nathanvardi/2012/10/05/zynga-keeps-
crashing-but-mark-pincus-is-having-a-great-year/)

[3] [http://www.huffingtonpost.com/2012/07/31/zynga-insider-
tradi...](http://www.huffingtonpost.com/2012/07/31/zynga-insider-trading-
lawsuit_n_1724410.html)

[4] <http://www.google.com/finance?cid=481720736332929>

updated to include pricing. Again, selling at 2x your employees == living like
a fucking boss.

~~~
bruceb
While I feel bad for the employees, some investors should have known better.
It was over priced at $12.

~~~
wavefunction
It was over-priced at $.01, apparently

~~~
Jack000
should have bought some puts

------
josh2600
You know what the problem here is? There is no material difference between a
10 person game studio and a 3000 person game studio. Zynga likes to pretend
that their Z-Cloud gives them an advantage over their competitors. Maybe it
does in terms of operations, but games isn't an operations business, it's a
hits business. All of the optimization in the world doesn't help if you can't
keep making wins and Zynga can't make wins because they're too cluttered with
layers of middle management FUD.

520 employees is a lot of people out of work, but I have to think they saw it
coming. My advice to people in similar positions all throughout tech is this:
there are three signs that indicate an impending downsizing.

* Depressed Stock Value over long periods of time

* An Acceleration of secrecy and fiefdom claiming within the culture

* You look around and no one wants to come to work anymore

If you find yourself in this situation, leave. Find another job. Being caught
in a downsizing sucks, but if you pay attention you can avoid them. It's
important to make friends and to be able to tell the temperature of your local
environment to avoid such devastation.

 _Edit_ : This can best be summarized as the well known phenomenon: "There's
no such thing as a Free Lunch".

~~~
mbesto
_Being caught in a downsizing sucks_

Or it can be a great. Severance packages can be quite lucrative.

The better advice I give people is "always be looking for job opportunities".
The best job opportunities come when you least expect them, and the worst jobs
are taken when you're desperate.

~~~
MartinCron
_the worst jobs are taken when you're desperate_

If I could suggest one thing for a young programmer to tattoo onto their inner
arm, it would be that sentence right there.

~~~
ollysb
Problem is they usually are actually desperate...

~~~
MartinCron
Being aware of being desperate and what that means will at least allow people
to make more informed desperate choices.

------
cletus
I feel bad for those who put their blood, sweat and tears into building Zynga.

I feel bad for those who have just lost their jobs.

I feel bad for those who remain under a cloud with the only comment they get
is self-deflecting language from their CEO like "brothers and sisters".

Who I don't feel bad for is Mark Pincus. The collapse of Zynga couldn't happen
to a more deserving person. Just 18 months ago when Zynga was on top of the
world, Pincus made a name for himself by bullying staff to give back stock
options [1] for no other reason than he thought they didn't deserve such a
huge windfall.

Well those chickens have come home to roost. Those same employers will be the
first to take flight having no further loyalty to the company.

I also know that I wouldn't work for Pincus. He's shown his true character
with this petty greed (how much difference did this make to him personally
really?).

Frankly I'd hesitate in working for any company backed by the same VCs that
let this happen. To allow this erosion of what I'd call the "startup bargain"
(trading salary for equity) by greatly reducing the upside is shortsighted and
undermines the very conditions that makes the startup scene thrive and
succeed.

As much as I viewed Groupon as a scam (a Ponzi scheme essentially), Andrew
Mason's parting words [2] after getting fired gained him a lot of respect
(from me at least) as they were authentic and didn't seek to cast blame
elsewhere. In fact he went so far as to make a joke of "spending more time
with my family" (which we all know is a euphemism for getting fired).

What entrepreneurs and VCs need to realize is these bullying tactics (and I
include the underhanded clawback agreements to Skype employees in this)
undermine the entire ecosystem and we need to send a powerful message that
they can't and won't be tolerated.

[1]:
[http://usatoday30.usatoday.com/tech/news/story/2011-11-10/zy...](http://usatoday30.usatoday.com/tech/news/story/2011-11-10/zynga-
ipo-stock/51158068/1)

[2]: [http://thenextweb.com/insider/2013/02/28/andrew-mason-
groupo...](http://thenextweb.com/insider/2013/02/28/andrew-mason-groupoin/)

~~~
stanleydrew
"Frankly I'd hesitate in working for any company backed by the same VCs that
let this happen."

I see some pretty big names in the list of Zynga investors. Namely Union
Square Ventures, Andreessen Horowitz, and Kleiner Perkins Caufield Byers. The
set of startups these VCs have invested in will cover a huge portion of the
"good" startups to work for.

I don't know if refusing to work for a company backed by one of them is a
viable option.

~~~
wslh
Google invested on Zynga, and Cletus work for Google. Sorry for being cynic,
it's not my style.

~~~
guard-of-terra
Why do you assume Google is so good? Or so unavoidable?

Recently Google bought Quickoffice and booted two offices of android devs + QA
in Ukraine without even paying them 2-month equivalent of salary for the
inconvenience. Not sure if they are going to sue.

You can argue it was not "The Google" but some of their proxies, but it
doesn't matter: as a company they're cool with that, saving some dimes by
ripping out employees they aren't going to use, when they can get away with
that.

~~~
wslh
See <https://news.ycombinator.com/item?id=5817073>

~~~
guard-of-terra
So what? I didn't doubt Google invested; I just claim it's not as important
because Google isn't actually good when it comes to treating 3rd party
employees.

~~~
wslh
You didn't read the whole thread. The thread was initiated by someone who
works at Google, and says ""Frankly I'd hesitate in working for any company
backed by the same VCs that let this happen.".

~~~
guard-of-terra
It wasn't obvious from the context that he works for Google.

And it seems he actually works for Twilio:
<https://news.ycombinator.com/user?id=stanleydrew>

But I would say "core Google" is safe, it's just that Google
investements/acquirement doesn't really mean any safety per se.

~~~
wslh
Again you are not reading what I say. The user is
<https://news.ycombinator.com/user?id=cletus>

------
seiji
A good reminder to not get stuck in local fad maximums.

Remember when the future of every single company was gamification or bust?
Remember when the seemingly only viable business model was skinner boxing rube
middle america housewives with no self control (oddly, middle eastern princes
also would spend tens of thousands a month on those silly in app purchase
games, except they can afford it and don't have their lives ruined with
addict-induced credit card debt)?

I don't have a point. Just notice how the "tech press" and fads and media
sweeps through in its ever-shortening attention span to the point where they
aren't good signals for anything anymore.

~~~
pekk
Empty, derivative Facebook games are not any more "skinner box" than anything
else we either enjoy or do out of necessity. Almost any game ever created
could be described as a "skinner box." Completing work units for a salary
could be described as a "skinner box." If there is something especially bad or
manipulative about Facebook games, it isn't that they are a "skinner box."

~~~
shardling
Perhaps you're unaware that Zynga explicitly treats games like skinner boxes?
Their whole deal was using metrics to manipulate the feedback loop to maximize
profit.

Even the most mainstream traditional games were designed to be fun -- they
might aim for the lowest common denominator, they may artificially inflate the
game length, but the goal was still entertainment. Because all they wanted you
to do was buy the game.

That's not the case with the microtransaction free-to-play model -- they need
you to not just play the game, but to feel a _need_ to play the game. That
means their goal is getting you addicted to the skinner box. The mechanics of
such a game are all built to reinforce this goal. Zynga took this to its
logical conclusion by A/B testing the various game parameters.

As Tim Rogers said, such games are "a love letter from a computer virus."

<http://www.actionbutton.net/?p=1076>

(Warning: long but insightful article (But if you recognize the author's name
you'd already know that.))

~~~
aeturnum
>That's not the case with the microtransaction free-to-play model -- they need
you to play the game, to feel a need to play the game.

Zynga focuses on mechanics that promote habits, but to say that's the only
approach incentivized by F2P is a pretty myopic view of the market.

The F2P model incentivizes addictive gameplay more than other genres, but it's
not like building an addicted game was a bad thing pre-F2P. Valve's DOTA 2,
for instance, has largely identical gameplay to its 100% free Warcraft 3-based
ancestor (tangentially, Team Fortress 2 isn't much of a skinner box either).

------
JunkDNA
I have only passively been paying attention to Zynga. I do feel bad for people
who are now out of work. However, the staggering thing about this article to
me was that 520 people only represents _18 percent_ of their employees. That
means that after this, there's an astonishing 2300+ people _still_ working on
Farmville and friends. Coming from a nonprofit biomedical research group where
I struggle to get single digit numbers of developers, that is mind-bending.

~~~
Androsynth
your nonprof biomedical group didnt have kleiner perkins pushing it towards an
ipo ;)

~~~
ttrreeww
Ah, but the IPO already happened so it's time to lay them off.

------
ignostic
> _"The reason? Mobile"_

I don't buy this at all, nor do I believe that this is a

It seems like everyone blames everything on either the economy or a shift to
mobile these days. Intel, Microsoft, EA, and now Zynga. All of this despite
the fact that dekstop traffic has remained steady or grown, even in the last
two years. Yes, more people are accessing the web via mobile, but it's still
only 15%. [1]

Do you see Activision-Blizzard and Steam talking about how mobile is stealing
their lunch? Nah, they're too busy eating Zynga and EA's lunches.

I have yet to see any data showing that EA or Zynga are shrinking based on
forces beyond their control. I bet the guys on /r/gaming - annoying though
they can be - could give you a better idea than journalists who buy the PR
lines. This isn't some totally-unforeseen and cataclysmic surge to mobile.

We're talking about a company with a reputation for churning out unoriginal
copies of smaller/indie games. THAT is their problem. If Zynga wants to grown,
they must focus on original and high-quality games. Costs and risks are much
higher, but _that's what people are willing to pay real money for._

[1] [http://searchengineland.com/report-mobile-traffic-to-
local-s...](http://searchengineland.com/report-mobile-traffic-to-local-sites-
growing-faster-than-total-internet-now-at-27-percent-158139)

~~~
stevenwei
It's really casual gaming that's suffering from this: folks are switching from
playing those types of games on Facebook to playing them on their phones.

------
untog
Boy does this suck for Zynga employees. I really feel for the former OMGPOP
employees as well- looks like Zynga has taken them down with them. I know that
OMGPOP were desperately short of cash themselves, but at least they were the
masters of their own destinies.

EDIT: and I wouldn't be too smug about their downfall if I were you. There
could be repercussions across the tech sector if Zynga totally fails.

~~~
gfodor
Why? I felt bad for Zynga employees who got screwed earlier since that was the
first breach of trust by their CEO and it was still unclear if Zynga was
something other than a game-copying exploiter of economically disadvantaged
people through game mechanic trickery. But now, after all the dirty laundry
has been aired?

edit: Any repercussions for the tech sector if Zynga fails will fall in the
"healthy correction" column in my book.

~~~
pyoung
I would assume that he is referring to the possibility of a confidence crash
in tech companies that would affect public markets. Personally, I don't think
Zynga is widely held enough for it to have much of an impact, and as you
mentioned, the dirty laundry has already been aired.

~~~
bennyg
I agree. If somehow Facebook plummeted and bankrupted it would absolutely
raise doubts about the tech sector. 1/7 of the world can't use a service it
trusts any more is a big deal.

------
dvt
The gaming industry is so fucked. On one hand, you've got huge conglomerates
like EA that release shitty game after shitty game with invasive DRM that
would make Orwell cringe, and on the other you've got 2300+ people working on
Farmville. I just feel bad for indie developers that release progressive and
inventive games competition after competition with tiny teams of 1-2 and live
on shoestring/student budgets.

Steam Greenlight ended up being more of a failure than a success, next-gen
consoles won't even give a shit about indies, and we wonder why this industry
is so screwed up. Don't even get me started on the lack of proper
infrastructure for competitive games, etc (at least in the West). The whole
thing is just depressing.

~~~
TillE
There's never been a better time to be an indie developer, particularly on the
PC. Marketing remains difficult, but now there are virtually no barriers.
Digital distribution and engines like Unity have changed everything.

Steam has its problems, and I wish they'd just shift to an Apple-style app
store model with a curated storefront. But in general, they've been a huge
boon to independent developers.

~~~
mehrzad
>I wish they'd just shift to an Apple-style app store model

If they lowered the minimum prices too, I wouldn't mind. But right now Steam
has a lot of third-rate "side-project" games that are lower quality than free
flash games online charging the price of a very good iOS/Android game and it's
getting annoying.

Now, I'm not one to think saturation with lower quality/more indie stuff is
always bad (especially with music, for example) but it seems with the ubiquity
of PC game development as a hobby, a decent amount of crap is a byproduct.

------
Irregardless
> _The move today will affect every part of the San Francisco social gaming
> company . . ._

Zynga is a gaming company? That's news to me -- I thought they were still in
the business of tricking people into paying for the privilege to click things
faster.

Is it any surprise that wasn't enough to sustain a company?

------
bosch
It's unfortunate such an ethical CEO as Mark Pincus has to go through troubles
such as this.

This is also a reminder that only very few companies caught up in the bubble
have real business models that will last when the bubble pops.

~~~
bosch
Yes, I was being sarcastic. Sorry, I thought everyone knew what a douche
Pincus was: (and this is just ONE example):

[http://techcrunch.com/2009/10/31/scamville-the-social-
gaming...](http://techcrunch.com/2009/10/31/scamville-the-social-gaming-
ecosystem-of-hell/)

Sidenote: Does HN stop editing after a certain timeframe? I can't find a link
to edit my original comment to add this.

~~~
saraid216
> Sidenote: Does HN stop editing after a certain timeframe? I can't find a
> link to edit my original comment to add this.

Yup. The time frame is ~15 minutes, AFAICT. Same with deleting, though I
_think_ that's about an hour. Don't quote me on those numbers.

------
warcher
The takeaway here, for me at least, is that Zynga got a lot of early success
via a couple smart exploits-- early social network virality (since shut down
by Facebook et al. because spammy Farmville requests hurt user experience) and
freemium gaming (which has been embraced by the rest of the competition and no
longer serves as a competitive advantage). So Zynga now has to be just another
gaming company, and gaming, as an industry, is high-overhead and high-risk,
with a lot of very serious competition. There's no hockey stick in running a
big gaming conglomerate; it's just a media business. If you have a hit, you
make money for a while, if you don't, you lose. Just like running a record
label or a movie studio.

------
methehack
> restructure its troubled business toward mobile

How can you found a company in 2007, go public in 2011, and not be prepared
for mobile in 2013? You take all that cash from public markets but fail to
have a mobile strategy while hiring 3000 people? That's a colossal management
failure. The board should rid the shareholders of him. Also, where the eff
_was_ the board? You'd think someone would have just held up their iphone in a
meeting and it would have been enough.

~~~
potatolicious
Because no one is really prepared for mobile, even now. The problem isn't that
no one saw the rise of mobile coming, but rather that no one really knows what
to do about it in response. Most people _still_ don't.

This is particularly true for advertising-based companies. Mobile users are
less engaged to your ads, have less intent, and are more loathe to tap on ads,
so even if you can maintain the dominance of your product into the mobile
space you're still looking at a bad revenue situation.

Mobile is _here_ now, in full force, but revenue on mobile platforms is still
largely an unanswered question. We started out selling apps, then we started
down microtransactions, and ads, but none of these are particularly great.

~~~
methehack
So I guess what you're saying is that zynga staffed as if mobile was going to
be as profitable as online but it turned out that it was an entirely different
beast. They scrambled to adjust, but nothing worked. Too many people; time for
tough love. Fair enough. The overstaffing may still be excessive -- the
reaction delayed, hard to tell -- but I can easily imagine swinging for a land
grab and ending up surprised in the dirt. Thanks for explaining. I guess I'd
make a crappy board member :)

------
soup10
With respect to employees that have lost their jobs. Good, fuck Zynga.

------
unfletch
The public announcement: <http://blog.zynga.com/2013/06/03/ceo-update-4/>

    
    
        "Our Founder and CEO Mark Pincus today sent a note to employees
         outlining structural changes..."
    

It might seem like a small thing to some, but I can't believe the casual
language on the blog post introduction. The CEO "sent a note" to his company?

I'm sure that softened the blow to those 520 people. It was just a note, after
all.

I don't care what your culture is like or that you want to be a "cool"
company. Notes are for reminding people to clear their old food from the
fridge, or seeing if anyone wants to get together after work to welcome the
new guy. This is serious shit to (hopefully) every one of your employees, and
especially so to 18% of them. There are times to be formal.

The letter itself is much better, but the blog intro is part of the official
announcement. It counts.

~~~
jlgreco
In this case, what is likely the material difference between that "note" and a
"letter"? I can't imagine this note was scrawled with sharpie onto a notepad
sized piece of paper with adhesive backing and faint images of fruits or
snowmen printed on it.

~~~
unfletch
A note is by definition brief and informal. I think the employees deserve that
any official communication in this kind of situation be neither.

Edit: And I'm sure I've put more weight on that one phrase than almost anyone
else, but I've worked at startups for years now and been through rounds of
layoffs at a couple. It's appropriate to err in the other direction.

~~~
nissimk
You expect better from Zynga? Isn't this the same company that fired people
immediately before the IPO so that founders could take back their stock
options? "Being a meritocracy is one of their core values."

[http://abclocal.go.com/kgo/story?section=news/business&i...](http://abclocal.go.com/kgo/story?section=news/business&id=8426597)

------
mp99e99
Well, considering that their industry didn't exist very long ago, 2000+
employees is still commendable [ie if they had gotten there with no layoffs
we'd be saying how great they are doing].

Its a young company, who knows what form it survives in but that it go so far
so fast is pretty impressive!

------
venomsnake
Why does Zynga have such a huge payroll?

Blizzard have in thousands mostly because of the Game Masters they need to
provide for WoW.

------
ajju
To anyone at Zynga looking for an interesting meaningful challenge that also
pays well: Transportation is changing, and InstantCab is on the forefront. We
are hiring smart people to join our team of a excellent hackers who are also
good people. We are hiring for almost every technical role you can think of.

We have been growing at double digit % every month for several months. Helping
people get from A to B seems like a simple problem that anyone can solve, but
the real world complexity required to scale such a company demands pretty
ingenious solutions and behind the curtain, we are building just such
solutions.

Email me: aj@instantcab.com so I can give you more details in a private
conversation.

------
ry0ohki
Based on the article, assuming the $80 mil in savings was over 1 year, that
means the average Zynga employee costs $153k per year.

~~~
jlarocco
Initially that seems a bit high, but after thinking about it a bit, it doesn't
seem unreasonable.

LA and NYC are expensive places to live, so the salaries will be bumped up to
account for the cost of living.

And the $80 million figure takes into account all of the taxes, social
security, unemployment insurance, and benefit costs associated with the
employees. An employee making $80k a year can easily cost $100k- $120k a year
depending on benefits and taxes.

And its trendy for big name "startup" companies to offer high salaries and
costly fringe benefits to attract "rock star" programmers.

~~~
Cookingboy
80k is definitely too low, practically all big companies in the Bay offer more
than that to fresh out of school kids these days.

------
gaius
Whatever happens - Pincus will do alright for himself.

~~~
gyardley
He's already done alright for himself, because he was wise enough to take
money off the table when he had the opportunity to do so.

What I don't understand is why he's still at it. This must be an enormously
stressful time. Why wouldn't he take the rather impressive amount of money
he's already made and just go enjoy his life?

Evidence, I suppose, that some of us are just wired differently.

~~~
roc
> _"This must be an enormously stressful time."_

If he's already taken (a lot of) money off the table, what's there (for him)
to be stressed about?

~~~
gyardley
You might be different, but I've always found firing employees and/or not
meeting expectations pretty stressful, no matter what my personal financial
situation.

~~~
roc
Well, _I'd_ have had a hard time building an empire off copy/paste game
development, spammy-to-fraudulent marketing schemes, encouraged social
pressure/spam, an 'arcade' currency, and a pretty shameless twisting of game
designs to really squeeze profit from that situation.

So I'm pretty sure the stress _I'd_ personally feel isn't worth talking about.

Which is why I not-so-subtly reframed the assertion in terms of the person who
_is_ in that situation.

------
sheri
I had visited the Zynga office a few years back, and was super impressed. Free
food/drinks everywhere, and the office looked really nice. They even had Zynga
branded water. I had not played any Zynga games until then, but came back
thinking these guys must be on to something.

That evening I went back and signed up for Mafia wars. After a few minutes of
repeatedly clicking buttons to watch an 'experience meter' rise, I knew this
couldn't last. There is of course more to it than just that, but it just
wasn't fun or engaging to play. I read a lot about how their analytics gives
them an advantage, but I just didn't see the appeal of that game. That bubble
had to burst.

------
VLM
Here's the problem:

Virtual Farmville Tractors at Zynga require about (520 this
layoff)/(represents 0.18 of workforce) around 3000 people to produce.

Real world tractors at Caterpillar Inc require about (125000 people
worldwide)/(about 110 plants) = about 1000 people to produce.

Something wrong when a fake tractor requires more people to produce than a
real tractor (yes yes I know that Zynga makes more than Skinner box farm games
on the FB platform, but I still found the comparison stunning)

~~~
jaredsohn
The comparison falls even more short since Zynga develops all aspects of a
farm, including animals and crops. And I woukd have to think there are many
more virtual farms than real ones.

You are also for some reason comparing all of Zynga with just one Caterpillar
plant.

~~~
VLM
That is true that I compared to only one plant, however caterpillar is a
holding company of multiple heavy equipment mfgrs, so it seemed unfair to
compare the EMD locomotive factory AND the bulldozer factory vs merely
farmville.

On the other hand, there are many more types of caterpillar tractors than
farmville tractors, which does even it up a bit.

------
hncommenter13
Maybe I missed it, but I didn't see a WARN act filing by Zynga with the state
of California for 2012 or 2013.
[http://www.edd.ca.gov/jobs_and_Training/Layoff_Services_WARN...](http://www.edd.ca.gov/jobs_and_Training/Layoff_Services_WARN.htm)

My understanding is that WARN Act notices are required to be filed in CA for
layoffs of more than 50 people by larger companies. (Perhaps the LA office has
fewer than 50 people?)

Ex-Zynga employee who feels like returning the favor? Make friends with a
plaintiff's side employment lawyer. Here's one:
<http://www.girardgibbs.com/california-warn-act/> (I'm guessing they make
waiving the right to such suits a condition of the severance, though.)

Note: I am not a lawyer and I have no idea whether Zynga violated the law. I
have no affiliation with the firm linked above. I do not necessarily believe
that filing a lawsuit will deliver either emotional or financial vindication,
and I have no idea whether or how it might affect one's future employment
prospects. But I do believe that all companies should be required to follow
the law as written.

------
programminggeek
I feel really bad for the employees getting laid off, but this feels a lot
like a company that assumed growth would be forever up and to the right
without leveling off or declining. Maybe when you go from zero to hundreds of
millions of dollars in revenue it's easy to feel that way, but I don't see a
place where Zynga is going to ever grow very rapidly again like in the "good
old days"

~~~
cwh
as a former Zynga employee, i'm pretty sure the entire management team knows
what they are doing, and have expected this for quite some time.

~~~
wilfra
What would you predict Zynga will look like in a year? In five years? Do you
think these layoffs are a good or bad thing for the future of the company?

~~~
cwh
I truly hope this is a "cut once, cut deep" action. There are still a ton of
extremely smart people at the company, I just hope they stop overreaching.

------
nicholassmith
It's so weird, Zynga started auspiciously with a core team of some amazingly
season develepors and rather than building up an amazing portfolio suddenly
ended up doing...well, nothing good.

The writing has been on the wall for a while, if we even see Zynga make it
through this year I'd be surprised. You can't assume you're going to win by
just thinking 'this will appeal to the masses', you need a hook to engage
them. FarmVille worked because people enjoyed it, not the concept, you can't
try and shovel the same shit twice.

Plus, Draw Something was a dumb purchase. A great game with low revenues
destroyed by high ads and shitty backed service. It was doomed to failure and
a massive waste of money that they were too young to afford to risk.

------
rdl
I thought the whole deal with Zynga was that it was circling the drain (yet
profitable) while waiting for "real money gaming" to be legal and possible.
These cost cutting measures in their legacy business would seem to be a good
thing in that light.

------
Freestyler_3
I do not know what these 2900 employees do, but not to long ago I played one
of their games for a while. Some really big constant problems in their games.
Once one thing breaks its takes a long time to get fixed, then it gets fixed
but breaks another thing. I remember Thursday before thanksgiving weekend
their game gave errors and was unplayable. It took 6 days for they to get it
to work.

That really shows devotion to the entertainment sector right? (Maybe it was a
bad steak maybe I was the only one seeing these problems, who knows? Ask the
company thats cutting 500 employees)

------
yesplorer
3000 people were making those Zynga games? Doing what exactly? Pls I'm
genuinely curious.

These social games seems so lame to me that I can't think of any reason why
someone will even think of building a public company on top of it. You simply
cannot meet investors' quartely demand when your success is built on being
"flavor of the month" business model.

I don't have anything wrong against Zynga or its founder and so I don't wish
them failure but this should have come as a common sense that they should have
stayed private and stayed lean (both in taking VC funding and the number of
employees)

------
saurabhnanda
I might be nitpicking here, but the very first sentence reeks of bullshit & PR
spin.

"...saying goodbye to 18% of our Zynga brothers & sisters..."

Who says that in real life? "I'm sad, because yesterday 25% of my family had
flu"

------
ahi
Stock trading halted after this was published? Did this article beat a planned
press release to the punch? If you traded this news you might have had a good
day.

------
grappler
So much for Tony Robbins and the “internet treasure”?

<http://www.youtube.com/watch?v=ZEojTYYyGA0>

------
dschiptsov
Looks like an attempt to re-establishing connection with reality: Flash-games
cannot be valued in billions even in a delirium.)

------
volume
Anyone out there dare to claim there is any "light at the end of the tunnel"?

Perhaps ZNGA is a good stock to buy now that it's over 10% off?

------
robodale
<http://www.nasdaq.com/symbol/znga/real-time>

------
martin_
I would love to see a breakdown on this. Specifically, the ratio between
developers, marketers, management, etc.

------
DividesByZero
Bad news for the educational game accelerator they just launched.

------
jokoon
seriously, what did zunga do/make ?

------
bob13579
Stock halted. Bracing for a crash.

This will be bad.

~~~
derwiki
This is the first I've seen a stock's trading being halted. Does anyone know
more about the mechanics of how this works? What the advantages/disadvantages
are?

~~~
jarcoal
It often happens after huge news, and it's meant to give investors time to
digest it.

I believe the last notable instance was after Jobs died, AAPL was halted.

~~~
chollida1
> I believe the last notable instance was after Jobs died, AAPL was halted.

That depends on your definition of notable. You could always use the "no true
Scotsman" logic to say that Steve Jobs death was the last "notable" halt but
they happen all the time.

here is the Nasdaq list of halts. Notice that there have been 3 halts already
today.

<http://www.nasdaqtrader.com/Trader.aspx?id=Tradehalts>

Here is a list of IROC halts( Canadian)

<http://micro.newswire.ca/70886-0.html>

Note that there have been 4 halts today for Canadian stocks.

~~~
RobAtticus
In fact, Zynga's stock was halted multiple times a little over a year ago when
Facebook IPO'd.

Also, the halt for Jobs death was after hours so it had a smaller impact.

------
kmasters
I look at this a little differently, Im not going to opine on the character of
the CEO or his employees.

Besides raw economic factors and the trend-happy game industry, I think its
worth it to ask:

What on earth are we building? And why are we building it?

Its OK to build games we all need entertainment. Nothing wrong with that. But
Zynga games were obsessive click factories which were as far as anyone can
tell designed to be addictive.

As an engineer, I have worked at places that had so called "projects" designed
to "get more clicks".

That may include a lot of web shops. Usually for ad revenue. But if you think
about that from an engineering perspective, what a woeful, sad day it is to
have your boss come to you with that mission.

Its the day you realize that what you built has no real value to the user, and
is a self serving mechanism to get meaningless clicks out of your robot users.

In the old days we made software that people wanted to use and we didnt care
how many times they clicked on a cow.

Or on an ad.

------
yoster
I know how it feels to be in that situation. Best of luck to all the people
who got the lay off. Make sure you hit the job search running and be sure to
network as much as possible.

------
camus
no problem, they are pivoting.Why do people hate Zynga so much?

