 "Microsoft entertainment head to be named Zynga CEO")
Games publisher Zynga Inc has replaced chief executive Mark Pincus with Microsoft Corp executive Don Mattrick, who headed Microsoft’s critical Xbox business, Zynga announced on Monday. The news, reported first by AllThingsD, sent Zynga shares up more than 11 percent earlier in the day. The shares rose a further 3 percent when Zynga confirmed the appointment after the bell.
Pincus, 47, who controls a 61 percent voting stake in the gaming company he founded in 2007, will remain chairman after personally helping to recruit Mattrick from Microsoft.
“Don is unique in the game business,” Pincus said in a blog post on Zynga’s website. “He can execute in multiple domains - hardware, software and network, and he’s been the person responsible for game franchises like ‘Need for Speed,’ ‘FIFA’ and ‘The Sims.’” Mattrick, 49, will take over as CEO next week, while Pincus assumes the role of chief product officer.
Zynga shares closed up around 10.4 percent at $3.07 on the Nasdaq. The were at around $3.17 after hours. Zynga’s business model, which relied heavily on selling virtual goods to gamers on Facebook Inc’s platform, began to disintegrate a year ago as users tired of Facebook games and shifted to playing on mobile devices. Pincus has been unable to turn around the company, named after his pet bulldog, Zinga. The company’s shares have hovered at just 25 percent of its $10 initial offering price in December 2011.
Don Mattrick during the Xbox One unveiling
Mattrick joined Microsoft in 2007 after spending years at gaming company Electronic Arts Inc , where he worked under Bing Gordon, a former EA executive who went on to join venture capital firm Kleiner Perkins Caufield & Byers. Pincus and Gordon, who sits on Zynga’s board, led the effort beginning several months ago to recruit Mattrick, who had expressed an interest in leaving Microsoft to lead a company, according to people familiar with the situation.
Pincus, who joins Groupon’s Andrew Mason among high-profile tech entrepreneurs who have relinquished their jobs as chief executives, publicly backed Mattrick’s appointment on Monday. “I’ve always said to Bing and our Board that, if I could find someone who could do a better job as our CEO, I’d do all I could to recruit and bring that person in,” Pincus said. “I’m confident that Don is that leader.”
At Microsoft, Mattrick helped turn the Xbox business into a profitable venture after years of losses, eventually propelling it into the No.1 selling console in the United States. Mattrick’s departure comes just as Microsoft gears up to launch the third version of its console, called the Xbox One. Unveiled in May and scheduled to hit stores later this year, the machine has already stirred controversy.
Gamers attacked the high price, Microsoft’s plan to require an Internet connection at least once a day and attempts to limit the sharing of used games. Last month, Microsoft reversed its position on the Internet connection and said it would allow game sharing. Mattrick joins a game maker that publishes social media-based titles and low production-value smartphone games, a departure from the world of big-budget, packaged games embodied by the Xbox.
Mattrick has been rumored to be departing for months. After EA’s CEO stepped down in March, industry sources speculated he was in the running to lead the top games publisher, where he previously held numerous leadership roles.
Reuters