July 01--For a social gaming giant, Zynga's expansion into Austin has been fairly
low-key.
It's almost as if the developer famous for hits like "FarmVille" isn't
even here, quietly occupying the seventh floor of a nondescript building
downtown.
But Zynga's local presence has grown steadily, to include not only the
downtown office but a quality assurance office in North Austin as well.
In all, Austin has become the company's largest satellite branch in the
United States, with about 215 people locally and plans to add 20 more by the
end of the year.
Company officials acknowledged that Zynga has flown below the radar here,
but that hasn't been intentional, said Mark Skaggs, senior vice president of
product development.
"We were just focused on games," Skaggs said. "We were just focused on
making it."
One of those products, the latest in the company's popular "Ville"
series, was developed in Austin. Titled "The Ville," the virtual
house-building game was released last week on Facebook along with a slot
machine game also developed locally.
Zynga first came to Austin two years ago when it acquired Challenge Games
in 2010. From there, the company slowly expanded in Challenge's old digs,
knocking out walls and gradually adding more and more space.
"When I first came, we pretty much stopped at these pillars here, and so
we've expanded twice in the last year to fill out the rest of the floor," Glen
Steinberg, the company's human resources director, said during a tour to show
off the offices.
Steinberg, who moved to Austin last year, said that like a lot of gaming
companies that set up development outposts in Austin, Zynga came to town
because of talent.
"I've been in the gaming industry for 14, 15 years now, and Austin is
forever home of awesome gaming talent," he said. "And I think that translates
really well to the social gaming space."
Many of Zynga's employees, Skaggs included, come from traditional
big-name publishers such as Electronic Arts.
But compared with traditional console or PC gaming, social gaming has a
new set of rules, Skaggs said. For instance, gamers on Facebook tend to be
much more collaborative, compared with the other platforms.
"And the way I describe it to (new hires) ... is look, when you come into
this business ... we're bringing you to our company because you have a lot of
experience making games," he said. "But what you have to do is, you've got to
learn a new language and how things actually work here, because a lot of the
traditional things don't work. ... The audience is different, so you have to
really change your thinking."
It's also different because users can play Zynga's games for free (the
company makes money through advertising or in-game microstransactions).
"You don't have to spend any money," Skaggs said. "So our job as game
makers is that we have to entice and give the gift of great gameplay to people
before they spend money."
These are a transitional times for Zynga.
Last week the company unveiled a network designed to provide the more
than 290 million players of its games with the same tools, whether they are
competing on Facebook's online social network, a mobile device or the
company's own website.
The network is called Zynga With Friends. That's a reference to one of
Zynga's most popular games, the Scrabble-inspired "Words With Friends."
Zynga also previewed several new games, including a food-themed title
called "ChefVille" as well as its Austin-developed offerings.
The addictive allure of Zynga's free games helped establish the company
as one of past decade's brightest Internet stars. Zynga has more than 290
million users worldwide and is expected to generate $1.4 billion in revenue
this year.
But some investors appear to be worried Zynga is running out of new ideas
as it girds for fiercer competition.
The company's stock closed at $5.44 on Friday, well below the company's
initial public offering price of $10 six months ago. The IPO raised $1
billion, enabling Zynga to buy its San Francisco headquarters for $234 million
earlier this year to accommodate the growth envisioned by CEO Mark Pincus.
The concerns dogging Zynga include its ability to keep churning out
popular games, increasing competition from more experienced entertainment
companies such as Walt Disney Co. and Electronic Arts Inc. and a shift toward
playing games on smartphones that is expected to fragment that industry.
Still, Michael Pachter, a research analyst with Wedbush Morgan
Securities, says he sees a "bright future" for the company.
"The Ville looks similar to The Sims Social, and should do very well," he
wrote in an email. "Their zFriends and Zynga.com platforms are smart, (and)
make their games more accessible and engaging."
Austin will be a big part of the company's plans going forward, Skaggs
said.
"You think about it, we bought Challenge Games, and we established this,
and we're growing it," he said. "Some of our other studios, we established
(them), and there's a team, and we'll grow them kind of naturally as we need
it, but this is here because the talent base and the desire."
Additional material from The Associated Press.
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