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Zynga Gets New CEO
Tuesday June 2,2013 : SOCIAL GAMING GIANT GETS A NEW CEO
Pincus remains chairman at Zynga in appointing former Microsoft exec to the chief executive hot seat
Zynga founder Mark Pincus has handed his chief executive officer responsibilities over to former top Microsoft exec Don Mattrick, but will remain as chairman and chief product officer of the social gaming giant.
Zynga announced the switch in a press release Monday, whilst Microsoft confirmed Mattrick's departure, noting that for now his former subordinates would report to CEO Steve Ballmer.
As exec responsible for Xbox operations, Mattrick was at the centre of the recent Xbox One launch and subsequent controversy over players’ ability to rent or sell their game discs. In the end Microsoft reversed the policy after many complaints, making the announcement in a blog post signed by Mattrick.
Mattrick said of his new job: “Zynga is a great business that has yet to realize its full potential. I’m proud to partner with Mark to deliver high-quality, fun, social games wherever people want to play.”
Last month, Zynga retrenched 18 percent of its workforce as the company, troubled also by an exodus of senior managers struggled to survive.
In an email to employees announcing the management changes, Pincus noted that he had always said that if he could find an exec whom he thought could run the company better than he, he would be prepared to stand down and appoint him.
"I’m confident that Don is that leader,” Pincus, who owns 61 percent of Zynga's equity, wrote.
Mattrick’s management experience other than Microsoft includes a 15-year stint with Electronic Arts.
Zynga shares soared 15 percent on news of the management change, although the stock price still has a long way to go before it can recapture the heydays of the company two years or more ago.
Coincidentally, on Monday the publication Venture Beat reported on Zynga following the publication of a new social gaming study by research firm Eilers Research.
The study claimed that Caesars Interactive Entertainment has toppled Zynga as the No. 1 publisher of social casino games in a competitive market that is now worth $1.2 billion worldwide, thanks to growth in demand, increased startup activity, and a series of high-profile acquisitions.
CIE, a subsidiary of Nevada land gambling giant Caesars Entertainment, acquired Israel’s Playtika in 2011 and picked up popular social games such as Slotomania. Now, that title as well as Slotomania Adventures, Bingo Blitz (acquired with the purchase of Buffalo Studios), and Caesars Casino have pushed Caesar’s to the No. 1 position with 18.6 percent of the overall market in the second quarter, Eilers Research found.
VentureBeat reports that by comparison, Zynga has 15 percent of the market it previously dominated with popul,ar games like Zynga Poker. It has expanded to titles Zynga Slingo, Zynga Slots, and Zynga Bingo, and it recently acquired Spooky Cool Labs as part of an expansion in the space,
The Eilers study positioned IGT in the No. 3 position with 14 percent of the market thanks to its $500 million acquisition of Double Down Interactive, with WMS in the No. 4 spot with JackpotParty operations.
Overall, social casino game revenues on Facebook were down 2 percent from the previous quarter to $309 million.
Zynga lost market share in the quarter due to double-digit percentage declines in users for Zynga Poker on both Facebook and mobile platforms. Big Fish Games’ Big Fish Casino is the largest standalone social casino app on mobile with an estimated $14.5 million in quarterly revenues, mostly from iOS sources.
The overall market is expected to grow 67 percent this year to $2 billion by the end of the 2013, Eilers said.
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