Our industry is one in transition. While massive “AAA” games still rule the day at retail, games are increasingly going digital and social gaming and micro-transactions are taking off. Casual games have widened the overall gaming audience and big publishers like Electronic Arts are taking notice. Madden might always be its bread and butter, but if EA wants to thrive like it once did, the company needs to adapt to the ever-changing landscape.
“Our strategy is different now; it’s about creating a live service across a portfolio of titles, with some social aspects and a variety of business models, including micro-transactions and subscriptions,” EA COO John Pleasants told paidContent.
EA's free-to-play FIFA game... micro-transactions are huge
Pleasants went on to note that EA is definitely looking to either partner with or acquire some of the leaders in the social games space. “We have huge regard for companies like Playfish; they don’t have high customer acquisition costs and they’re getting users to bite on micro-transactions from the start. So we’re in investment mode, and we’ll be announcing deals with companies that will be of note some time in the near future,” he said.
Pleasants continued, “We’re also building four social network games from the ground up—in addition to a platform that connects game-play feeds from the consoles to a player’s social network. Then there’s Pogo.com. We’re working on back-end stuff like better SEO, new user interfaces and adding micro-transactions to the core subscription model. It’s not necessarily a competition—since we already run one of the largest online and social gaming sites standing right now—it’s more about creating this comprehensive package of social activity for every person that plays one of our games.”
It may not be immediately evident, but the digital focus can actually be very profitable too. Pleasants noted that EA has around 5 million people in Korea playing its free, micro-transaction-based FIFA soccer game and that's generating around $1 million per month in revenue. Moreover, EA launched an online component for FIFA called Ultimate Team, which relied on players purchasing digital cards to build up their roster, and that brought in $10 million in just the first month.
Clearly, there's massive potential in the free-to-play or “freemium” business model, and while it's fared better in Asia, IndustryGamers believes it's just a matter of time before it really takes hold in America.
1 Comments
June 18, 2010
Actually the only EA licenses that have been consistently recycled this generation are their NFS franchise and sports games.
(Yeah I remember one Medal of Honor came out, but that doesn't really count.)