Electronic Arts plans to grow its digital game business to become one-third of their total revenue over the next few years and that includes starting to charge for what one analyst described as very long game demos.
The comments came during an analyst visit to Electronic Arts' Redwood City headquarters and meetings with the company's executives.
One of Electronic Arts strategies will be to release what they call "premium downloadable content" on the Playstation Network and Xbox Live for $10 to $15 and then later release the full game for a full price, EA Group General Manager Nick Earl told Wedbush analyst Michael Pachter during the recent meeting.
Pachter writes in his report of the meeting that this premium downloadable content would "essentially be a very long game demo, along the lines of 2009's Battlefield 1943." The "full-blown packaged game" would released shortly after the download version, he writes.
Earl told Pachter that the strategy would allow the company to limit the risk of marketing the full game and would "serve as a low-cost marketing tool."
A marketing tool that it sounds like you'll be paying $10 to $15 for. We've contacted Electronic Arts for comment and clarification, but have not yet heard back. We'll update this story when and if we do.
During the same meeting at EA, John Riccitiello, the company's CEO, told Pachter that the "company had
performed poorly over the first years of his tenure, and admitted that the turnaround of the company was taking longer than he originally expected."
Riccitiello estimated that Electronic Arts was about two-thirds of the way through its turnaround, and one-third of the way through its "transformation to the distribution of intellectual property through multiple channels."
He added that he expects the company to grow its digital business to one-third of EA's revenues within the next few years.
Another major way that EA plans to achieve that goal, Riccitiello told Pachter, is for EA to "exploit all of its
packaged games with ancillary digital revenue streams."
thats the EA we all know and love
Quote from: GamerMan316 on March 22, 2010, 06:02:28 PM
"exploit all of its
packaged games with ancillary digital revenue streams."
Rip customers off with DLC
EA: We Will Not Charge For "Traditionally Free Game Demos"
Electronic Arts tells Kotaku that while they're exploring different downloadable game strategies, they do not plan to charge gamers for "traditionally free game demos."
The clarification comes after word hit via analyst Michael Pachter's visit to Electronic Arts, that the company planned to grow their digital game business in part by release what EA called "premium downloadable content" on the Playstation Network and Xbox Live for $10 to $15. Pachter described that content as "essentially be a very long game demo, along the lines of 2009's Battlefield 1943." The "full-blown packaged game" would later be released at a full retail price.
EA Group General Manager Nick Earl told Pachter during the recent meeting that the strategy would allow the company to limit the risk of marketing the full game and would "serve as a low-cost marketing tool."
Responding to request for comment, EA's Jeff Brown said that the publisher and developer is working on a "number of projects for delivering premium content to consumers before, during, and after the launch of a packaged-goods version of the game."
"EA SPORTS, EA Games and EA Play are each experimenting with download strategies that deliver fresh game content in formats players want to experience," he writes. "To date, there is no set pricing strategy for the entire EA portfolio. And many of the proposals include free-to-play content on models similar to Madden Ultimate Team, Battlefield Heroes and Battlefield 1943."
"None of the proposals" Brown wrote, "call for charging consumers for traditionally free game demos."
Speaking at the Game Developer's Conference earlier this month Ben Cousins, general manager of free to play Battlefield Heroes, told a gathering of designers that EA is becoming increasingly interested in free-to-play or "freemium" games.