OMG! Zynga Inc (NASDAQ:ZNGA) is shuttering OMGPOP
Almost a season ago, gaming giant Zynga Inc (NASDAQ:ZNGA) had bought OMGPOP activities for around $200 thousand and this team set off on its jaunt in July. Now, in August the company is has planned on shutting-down the OMGPOP division.
This is a clear indication that a majority of the sites activities such as Cupcake Area, Gem Rush, Share Globe Champion and Snoops are almost on their way out. The only bright spot probably is that at least for the moment, the Sketch Something series will not be taken off the board. Very oddly, it had been reported that some ex-OMGPOP employees had offered to purchase some intellectual property and assets from ZNGA, but had been unsuccessful in doing so.
A plan that failed
There probably was a time when Zynga felt that it would be able to leverage OMGPOP’s success as Draw Something was at the pinnacle of its popularity. MySpace was also making the best of this trend at this point of time. And though not suddenly, but very steadily, OMGPOP started bleeding players.
Both, MySpace and Zynga saw danger signs and tried to salvage the situation by launching Draw Something 2 however, it did not work out as expected. ZNGA has been facing a lot of turbulence in an industry that is constantly changing. Lately, they have had to lay-off staff and adopt other cost-cutting measures as well.
Time to change direction
There was a time when Zynga stock was definitely on the long-term investor’s portfolio. A couple of months ago there was also some news that it was planning on launching online, real money gambling in the U.S, but that plan did not see the light of day. The country has stringent rules and regulations for this kind of gambling and ZNGA must have thought that the hassles associated with it far outweighed the profitability-potential. Seems like it’s time for the company to pick up its heels.