Electronic Arts to cut 250 at its online gaming unit

Vidgame co. reduces staff to 450

Videogame publishing giant Electronic Arts said it will cut as many as 250 jobs at its EA.com online gaming unit in an effort to reduce expenses. The layoffs represent 36% of the venture’s employees, reducing its size to 450 staffers.

EA, the largest vidgame maker, has taken longer than expected to create games that enable thousands to play simultaneously over the Web and require users to pay monthly subscription fees. The failure of “Majestic” to attract a large number of Netizens also hasn’t helped. Roughly 15,000 users currently pay $9.99 a month to play the online thriller, which features conspiracy theories and communicates with users via email, fax and voicemail messages.

EA.com, which also offers free games such as hearts and backgammon, posted a $27 million loss in the quarter ended June 30 on sales of $16.4 million.

Electronic Arts unveiled plans for EA.com in late 1999. Company has agreed to pay AOL Time Warner $81 million over five years for the exclusive rights to provide online games on its AOL Internet service.

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