Kixeye chief: 'Zynga is burning to the ground'

Zynga's social-game competitor says its better-known rival is relying on its legal department to stay afloat.

Don Reisinger
Former CNET contributor Don Reisinger is a technology columnist who has covered everything from HDTVs to computers to Flowbee Haircut Systems. Besides his work with CNET, Don's work has been featured in a variety of other publications including PC World and a host of Ziff-Davis publications.
Don Reisinger
2 min read

Kixeye CEO Will Harbin, who abruptly found himself in the middle of a lawsuit with his social-game rival Zynga, is firing back at the CityVille maker.

"Zynga is burning to the ground and bleeding top talent and instead of trying to fix the problems -- better work environment and better products -- they are resorting to the only profit center that has ever really worked for them: their legal department," Harbin said in an e-mailed statement to CNET.

Harbin's issues with Zynga relate to Alan Patmore, a former general manager on CityVille that left the game maker in August to join Kixeye as vice president of product. Last week, Zynga filed a complaint in the Superior Court in San Francisco, alleging that Patmore took 763 files from Zynga, including confidential game designs, and brought them to Kixeye.

A judge yesterday granted Zynga's request for discovery, saying that the company could depose Patmore for a period of three hours, as well as search his computer, iPhone, and iPad.

Kixeye is a lesser-known social-game maker based in San Francisco. The company's games, which include War Commander and Battle Pirates, are largely combat-based and target a male demographic. That strategy results in a smaller user base, but typically increases the money Kixeye can make per title, thanks to its laser-like focus on its narrow market. According to Harbin, two of his company's games are among the highest-grossing titles on Facebook.

"Why on earth would we want to emulate a business that has seen a 75% decline in share price since their debut?" Harbin asked in his statement, citing Zynga's poor stock performance. "According to their S1 (Registration Statement filed with the SEC), their games average $.06 of Average Revenue Per Daily Active User (ARPDAU). Our games generate up to 20x that. You do the math."

Zynga has been struggling lately. The company announced earlier this year that during the second quarter, it generated $332.5 million in revenue, but lost $23 million. It was the third quarter in a row that Zynga posted a net loss.

Meanwhile, Zynga has been hemorrhaging top executives. Aside from Patmore, Zynga in just the last few months has lost its chief marketing officer Jeff Karp, vice president of the mobile division, Ya-Bing Chu, and general manager Jeremy Strauser, among many others.

(Via All Things Digital)