Yesterday the gaming industry was fussed as Electronic Arts (EA) announced their launching scheme of SimCity Social franchise on Facebook during its press conference at E3. The said title owned by EA was set to compete with one of Zynga’s hit-maker games, Farmville and subsequent games such as CityVille. Lucy Bradshaw, Senior VP of Maxis (the unit that is responsible for the Sim series) said that the game will be off to the gaming industry in about three weeks.
If the debut becomes successful, it would be a big threat to Zynga. SimCity is a well brand game and has garnered tons of followers since before, and the possibility of luring a large number of Farmville players would be fatal to Zynga. The Sims Social lured more active users than any Zynga game last year, and SimCity Social may even do better than its predecessor. If that will happen, EA with surely send big Z’s crowning days to its deathbed.
Zynga had been expanding consistently yet questions continue to be raised over the feasibility of its business style. Zyng had been lying its back on Facebook (FB) and mobile applications through Apple's (AAPL) App Store, Google's (GOOG) Android Marketplace, Microsoft's (MSFT) Marketplace, and Research In Motion's (RIMM) Blackberry App World for some time now, yet with cut-throat competitions on Facebook, this could might limp Zynga’s leg.
Zynga are good developers and quite known for their branded games, however social games become saturated markets very quickly. Zynga’s shares shut down about 5% yesterday and are currently down 40. 38% year-to-date, more likely its fate will be decided in the next few years, yet entirely depends how Zynga will face the competitions starting today.
As an overview, EA is trading at $13.09, while ZNGA is trading at $5.61 today. Seeing these numbers, will you tell me how Zynga will take the challenge?