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Zynga Games Proposes To Close UK Studio

Published October 24, 2012 by |

Zynga, the online games company behind numerous social media gaming hits, is set to close several studios, including its UK location, as part of a worldwide effort to cut costs.

Zynga is behind five of the ten most popular games on Facebook according to researcher firm AppData, including FarmVille, Mafia Wars and Texas HoldEm Poker.

Although no final decision has been made on the UK studio, based in Farnham, Surrey, the San Francisco company has already closed its US Boston studio and will cut around 5% of its 3,200 full time employees worldwide.

In an official statement Mark Pincus, the company’s CEO, said;

“We are closing the Zynga Boston studio and proposing closures of the Zynga Japan and UK studios. Additionally, we are reducing staffing levels in our Austin studio. All of these represent terrific entrepreneurial teams, which make this decision so difficult.

“This is the most painful part of an overall cost reduction plan that also includes significant cuts in spending on data hosting, advertising and outside services, primarily contractors.”

Zynga is also set to “sunset” (read: close) thirteen of its older titles as well as reduce its current investment in ‘The Ville’ – which has come under fire from rival EA.

The cuts have had the desired effect for Zynga as after the announcement, made during Apple’s iPad Mini unveiling, company stock rose by more than 3%, to $2.27 (£1.41) in after-hours trading.

Meanwhile Facebook revealed that Zynga is the social network’s most popular gaming company by quite a clear margin. It accounts for 7% of Facebook’s total revenue in the last quarter, although this is down from 10% in the previous quarter and 12% the last quarter of 2011.