The members of the media covering the technology industry are focused on the launching of Apple Inc. (NASDAQ:AAPL)’s iPad Mini; however, their attention was distracted by Twitter messages that Zynga Inc (NASDAQ:ZNGA) laid off more than 100 employees and shut down some of its studios in Austin, Boston, and Chicago.
A report from Gamasutra confirmed that more than 100 employees lost their jobs in the social gaming company. An employee of the company said Zynga’s game called The Ville, and a new IP were both discontinued.
According to reports, the layoff occurred in its studio in Austin. The company asked its employees, who have been working for the company for more than two years to return their badges, computers, and phones. The employees were given two hours to leave the studio.
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Technology reporters suggested that Zynga Inc (NASDAQ:ZNGA) decided to discontinue The Ville, due to the copyright violations complaint filed against the company by EA, for allegedly copying Sims Social. According to EA, The Ville is a copy of the entire framework and style of Sims Social’s game play.
Zynga Inc (NASDAQ:ZNGA) denied the allegations and responded that it is committed in creating the most fun, innovative, social, and engaging games in every major genre for its players. The Ville is the latest game in its “Ville” franchise. Zynga said, It’s unfortunate that EA thought that this was an appropriate response to our game, and clearly demonstrates a lack of understanding of basic copyright principles. It’s also ironic that EA brings this suit shortly after launching SimCity Social, which bears an uncanny resemblance to Zynga’s CityVille game. Nonetheless, we plan to defend our rights to the fullest extent possible and intend to win with players.”
Some observers also suggested that Zynga’s decision to cut more than 100 jobs amid the launching of the iPad Mini is “classic media strategy” to announce bad news.
The stock price of Zynga Inc (NASDAQ:ZNGA) is down by more than 5 percent to $2.20 per share on Tuesday after the closing bell.