2023-11-26 15:39:12
Gaming news Sony in a historic trial, Embracer returns to the layoffs: the business news of the week
Published on 11/26/2023 at 4:39 p.m.
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This week in video game business news: Sony which may have to reimburse the enormous sum of 7 billion euros to millions of plaintiffs, Embracer which is reconsidering its restructuring or even some new sales figures.. .
Sony in a historic 7 billion euro lawsuit
Sony is in the news a lot at the moment, and for good reason: the Japanese giant is currently being sued, accused of having abused its dominant position through an English collective action. The complainants point to the far too high prices of video games sold on PlayStation Store and which, above all, do not come down or only slightly depending on the evolution of the market.
We are talking regarding a historic trial, since all the same 9 million English players who come together to attack the manufacturer: if the complaint was filed a year ago, British justice has only just come, there is a few days, to make it official and the rest will therefore be done in court.
“This is the first step in getting consumers back what they are owed because Sony broke the law. Through this action, we seek to stop this illegal behavior and ensure that customers are compensated.” – Alex Neill, general director of the consumer defense site
Within this accusation of having taken advantage of its dominant position, a very particular problem is also singled out: a 30% commission to video game developers and publishers on all sales
Beyond the brand image, Sony also risks a lot since it might then reimburse each injured consumer between 75 and 650 euros, for a total sum… of 7.2 billion euros! The players concerned are therefore all British people who purchased a game or DLC on the PS Store between August 19, 2016 and August 19, 2022, unless they object to this refund. To be continued in the next episode…
Embracer speaks out on layoffs, but remains positive
The video game industry has been facing a crisis situation for months, being affected by countless waves of layoffs: Embracer, following having had to sit on a deal worth some $2 million on which it had bet everything, especially had to part ways with 904 people between July 1 and September 30, when it closed some of its studios.
Phil Rogers, Embracer’s interim strategy director, recently spoke to GamesIndustry.biz regarding the situation. Firstly, one of the group’s thinking heads does not hide his positivism.
We believe we are on track to achieve the goals we have set for ourselves. So we are very positive regarding that.
We are in line with our debt reduction targets, with savings and our capital expenditure targets, which essentially correspond to our gaming pipeline. And obviously we’re going to readjust that game pipeline. The execution rate we are talking regarding is SEK 5 billion ($478.4 million) for the next financial year. These adjustments are very, very clear and obvious objectives for us. So I think we’re making good progress on all of that.
We discuss how we can improve our efficiency and liquidity. How can we transform ourselves into a leaner, stronger, more focused and – above all – more self-sustaining company in terms of cash flow? I think that resulted in some really good challenges for the whole company.
Obviously, it’s impossible not to talk regarding the layoffs themselves and how Embracer had to handle them.
< Il y a beaucoup de choses qui circulent dans l'industrie au moment de la restructuration, mais l'inconvénient, évidemment, est l'impact sur les gens. C'est quelque chose qu'Embracer ressent vraiment.
It has been an agonizing process seeing such a reduction in staff numbers, but we know it was necessary for us to achieve our new overarching goals. So overall, we’re making good progress.
Our priorities are… to stay focused on collaboration, with an eye toward achieving our goals. We announced that we expected more restructuring and more cancellations, potentially more closures or management buyouts. This is the balance sheet we have.”
In brief in the business news of the week
A Plaque Tale Requiem has sold over 3 million copies. The PlayStation Portal was sold out two days following its launch, although Sony did not release a precise number. Mobile games studio Savage Games Studios, owned by Sony, has just renamed itself Neon Koi in order to find a new identity following recent departures. Life is Stange has just surpassed 20 million players. Halo Infinite surpassed 30 million players
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