Zeewolf: EA is now cutting 1500 jobs, and have canceled over a dozen unannounced games. The new EA-policy is (
quoting their CEO):
Anything that doesn't measure up to be in a very high profit contributor and unit seller got cut from this point going forward We can only hope that Dragon Age Origins will be "a very high profit contributor and unit seller". Because if it isn't, it's going to be the last game of its kind from BioWare (owned by EA).
EA's been hemorrhaging money for the past couple of years, with the net income for their 2008 fiscal year being a loss of around $1.1 billion, and FY 2009 not looking much better. They're selling plenty of games and bringing in plenty of money, but it seems like they just end up spending way too much in doing so, and I don't think their strategy of just focusing on blockbuster titles is going to help with this. This is because, it seems to me, that while large development budgets and massive marketing campaigns can produce blockbuster hits that move a lot of units, the cost involved shaves down the profit margin way too much, and the resulting net income just isn't enough to support a company as monolithic as EA. Basically they've just gotten too big to support their own weight.
I think that as we go into the future what we'll see with RPGs, and many game genres in general, is a move away from cutting edge, big budget titles, and a move towards smaller production budgets and games more targeted towards specific niches (instead of trying to be everything to everyone), resulting in games that, while bring in lower net income, have significantly higher profit margins. There are simply so many games being produced now that companies need to narrow down their market focus, produce what may have classically been considered "niche" games, and be satisfied in capturing a significant portion of their target market at a reasonable production budget rather than trying to capture a numerically larger but proportionally smaller slice of the overall market at the cost of a budget that eats up most of the game's revenue.