lbalbalba writes "Electronic Arts is shutting down its Westwood-based game developer Pandemic Studios just two years after acquiring it, putting nearly 200 people out of work. 'The struggling video game publisher informed employees Tuesday morning that it was closing the studio as part of a recently announced plan to eliminate 1,500 jobs, or 16% of its global workforce. Pandemic has about 220 employees, but an EA spokesman said that a core team, estimated by two people close to the studio to be about 25, will be integrated into the publisher's other Los Angeles studio, in Playa Vista.' An ex-developer for Pandemic attributed the studio's struggles to poor decisions from the management."

A few days ago at Comic-Con, Sony Online Entertainment president John Smedley spoke about the success of Free Realms, their free-to-play MMORPG that relies on microtransactions for a business model. The game was released at the end of April, and by mid-June there were upwards of three million registered users. Now that total is approaching five million, with no sign of slowing down. Min Kim, another panelist at the discussion, said, "When people started talking about it back in 2003 or 2004, people said Western games would never want to do this, to play a game for free and then buy items. And now everybody is saying, 'We're going to have microtransactions as part of our business model.'"