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Sep
11th

Zynga Cleans House

Last July social gaming giant Zynga announced that it would not pursue real money online gaming opportunities in the US. The company made the announcement as part of its Q2 earnings report. During the three months ending June 30th Zynga’s revenues fell by a whopping 31%to $231 million, a loss of $15.8 million. In a statement the company’s new CEO, Don Mattrick said Zynga needed to “get back to basics” and take “a longer term view on our products and business.” Mattrick also said Zynga expected “more volatility … than we would like over the next two to four quarters.”

The biggest source of volatility was the company’s statement that it believed “its biggest opportunity is to focus on free to play social games.”  Zynga continues to evaluate the company’s ‘test’ of its partnership with European gaming giant Bwin Party. The statement also said that Zynga had made “the focused choice not to pursue a license for real-money gaming in the United States.” Instead the company will “evaluate all its priorities against the growing market opportunity in free, social gaming, including social casino offerings.” In August Zynga acquired game developer Spooky Cool Labs. The company’s lead designer, Joe Kaminkow, is a legend in slot machine circles.

In post earnings calls with analysts Zynga executives downplayed the withdrawal from the American real money online gaming market and said that the company needs to ‘regain focus.’ Zynga had started a preliminary finding of suitability from Nevada gaming regulators. At the end of June Zynga founder Mark Pincus stepped down from his role as CEO. Before he stepped down hardly a week went by without Pincus saying that the company would prosper once it began making money on its real money games like Zynga poker, Zynga internet bingo and Zynga casino games.

This month new CEO Mattrick culled the executive ranks at Zynga. Those fired included chief operating officer David Ko, chief technology officer Cadir Lee and chief people officer Colleen McCreary. In an email to Zynga staff Mattrick described his purge as “taking layers out of the executive ranks to get senior leaders closer to important product initiatives.” For the time being it looks like Zynga will focus on its popular social gaming applications. Zynga bingo is an incredibly popular internet bingo game available on Facebook. The game was launched in 2012 and has a player base of millions.