Posted: March 22, 2013 in Video Games
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Recently, Electronic Arts CEO John Riccitiello has decided to step down from his post as running one of the most important entities in all of gaming. This was met by the stock tanking another 8% upon the news, and while I don’t follow business news all that often, I know enough when a CEO leaves a company in worse shape then he got it, it is usually met with a boost in stock price, not a drop.

I am not here to talk about EA’s financial side, I don’t own stock and don’t particularly care. What is undeniable is that in the gaming community, EA represents everything that is wrong with the video game industry from a consumer standpoint. Whether its same day DLC, releasing so called roster updates for games such as madden year after year, or the dreaded Micro-transactions, EA is blamed for bringing these nickel and dime practices to the main stream gaming market.

I’m sure some people will draw the conclusion that this is related to the Sim City launch fiasco, but I don’t. Corporations don’t work like that. While Gamers maybe outraged at the online DRM, and server issues, investors looks at expectations versus results, and from all indications Sim City has exceeded sales expectations, which is what led to the launch issues in the first place.

I do think EA has a business model problem that is contributing to many of their current issues. EA recently said that Dead Space 3 needed to sell five million copies to remain a viable franchise. This is mind-blogging to me, CD Project Red can produce a game like the Witcher 2. A game that, even two years old is one of the best looking games I have ever played graphically, filled with tons of great voice acting, and longer then most any other game. It can sell two million copies and be fully viable to make the Witcher 3. What could possible make Dead Space 3 need to sell five million copies to remain viable?

This isn’t the only example, 38 Studios went bankrupt last year after releasing a new IP Kingdom of Amalur: Reckoning (Published by EA) Even though KoA sold a respectable 1.5 million copies the company went under saying it needed to sell three million copies just to break even, and it was expecting to sell five million. In any business, if a company can make a better, cheaper product you’re in a lot of trouble, and EA’s stock price has shown that.

The real question is, will a change at the top going to have any tangible effect on EA going forward. That only happens if the new person in charge has an entirely different philosophy towards gamers, One who believes that making a quality game and letting a franchise breath can be just as profitable in the long term as what they’ve been doing.

As much of a pipe dream that this may seem, it doesn’t seem that the current way is making EA a stronger company overall. As outrageous as this may sound, EA’s best course of action as a business might be put their consumers first for once, regardless how alien the concept may seem to them.

  1. […] Gamerkingtarheel Gamerkingtarheel's Video Game Blog Skip to content ← EA LOSES TOP MAN […]

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