View Full Version : EA buys 20% of Ubi Soft and EA becomes largest owner
Link (http://uk.biz.yahoo.com/041220/323/f8vs0.html)
Electronic Arts buys 19.9 pct in Ubisoft from Talpa Beheer
PARIS (AFX) - US video games maker Electronic Arts (NASDAQ: ERTS - news) said it bought about 19.9 pct in French rival Ubi Soft Entertainment SA from Talpa Beheer BV for an undisclosed sum.
Ubisoft shares closed at 16.98 eur on Euronext Paris on Friday, valuing the company at about 300 mln eur.
Electronic Arts said the share purchase, carried out in one block, will be completed when antitrust clearance is obtained from the US government.
Talpa Beheer is the investment vehicle of Dutch financier John de Mol, co-founder of TV company Endemol which pioneered reality TV with 'Big Brother'.
Talpa was reported early in 2004 to have raised its stake in Ubisoft to 10.5 pct
FYI, the Guillemots, the founders of Ubi and previous Largest owners, have ~15% of the capital.
http://www.ubisoftgroup.com/NR/rdonlyres/B8289266-BA2F-4F9C-ACDA-C5033FACC2FB/2055/actionnariat.jpg
EA is unstoppable, run to the hills, or else EA might buy you...
Crap, just when Ubi had started churning out consistently good games. I guess anyone raising the standard above 'mediocre' must be pretty worrying for EA ... they might have to start competing.
Evil_Cloud
20-Dec-2004, 15:13
Ubi Soft can still buy back some of it's public shares, they certainly have the money to do that.
This is really bad news :( :( :(
marconelly!
20-Dec-2004, 16:21
Ubi Soft can still buy back some of it's public shares, they certainly have the money to do that
They have actually been shopping around for someone to buy that 20% from what I've heard. It's not like EA took those shares over in some hostile takover.
Ya know... this is really strange. MS cutting thier entire sport division, EA getting exlcusive NFL rights and buying up developers (and now other publishers) like crazy, including renderware.
You gotta wonder why these things are happening and if there's any connection between them. I can see MS only cutting sports if they fully expect to be supported in that areas by someone like EA or sega.
It is beginning folks ...
It is beginning folks ...
Yeah, and everybody thought MS was scary. *shudders*
Tommy McClain
Evil_Cloud
20-Dec-2004, 18:21
I wouldn't call it Electronic Arts anymore, but Electronic Darts, they seem to have targeted the entire market...
marconelly!
20-Dec-2004, 19:48
You gotta wonder why these things are happening and if there's any connection between them. I can see MS only cutting sports if they fully expect to be supported in that areas by someone like EA or sega.
What is there to expect? They are fully supported by both EA Sports and Sega Sports.
Joshua Luna
20-Dec-2004, 19:50
Maybe MS will buy EA :lol:
Guden Oden
20-Dec-2004, 20:06
It is beginning folks ...
Cue Imperial March
More details...
http://www.gamespot.com/news/2004/12/20/news_6115370.html
Evidently Ubisoft sees the move by EA as "hostile". Plus, they hadn't heard EA made the move until they read it on the Internet. Boy is this turning into the "As the Word Turns". LOL
Tommy McClain
Magnum PI
20-Dec-2004, 21:23
You gotta wonder why these things are happening and if there's any connection between them.
you suggest EA going exclusive to xbox 2 ?
in other words MS - EA alliance ? :shock:
cthellis42
20-Dec-2004, 22:07
EA is unstoppable, run to the hills, or else EA might buy you...
I'm definitely for sale! :P
This is horrible news and very bad for the gaming industry. I really dislike where this is headed. I hope Ubi Soft is able to buy back much of its own public stock in order to secure control over itself. If not then I guess we can kiss Ubi Soft into the garbage as well. It's a shame that EA wants to assmilate all the good developers in the gaming industry and turn them into utter crap.
Evil_Cloud
20-Dec-2004, 22:44
This is horrible news and very bad for the gaming industry. I really dislike where this is headed. I hope Ubi Soft is able to buy back much of its own public stock in order to secure control over itself. If not then I guess we can kiss Ubi Soft into the garbage as well. It's a shame that EA wants to assmilate all the good developers in the gaming industry and turn them into utter crap.
Their main goal is to make a profit, I don't think they're THAT stupid to just put many succesful franchises - if they were to acquire Ubi Soft - to waste...
This is horrible news and very bad for the gaming industry. I really dislike where this is headed. I hope Ubi Soft is able to buy back much of its own public stock in order to secure control over itself. If not then I guess we can kiss Ubi Soft into the garbage as well. It's a shame that EA wants to assmilate all the good developers in the gaming industry and turn them into utter crap.
Their main goal is to make a profit, I don't think they're THAT stupid to just put many succesful franchises - if they were to acquire Ubi Soft - to waste...
No so tell me what happened to wing commander and ultima ?
Inane_Dork
20-Dec-2004, 22:52
I don't know why EA is buying all these developers. They're moving jobs to China as soon as possible, I'm sure. Just for licenses and IP, perhaps?
Anyway, I really wish someone would stop EA, but I don't know anyone who would. Ubi isn't NEAR big enough to outmuscle EA. No 3rd party is. And all the console makers are busy sending congratulatory emails to EA in hopes they won't have to pay quite as much to get all of EA's games next time.
And if anyone purchased EA (and the sale actually got approved by various governments), they would become the new EA. How could you reform all EA's assets?
Their main goal may be to make a profit, but it is not through providing great games. EA is known for buying out great developers and transforming them into lifeless entities that are nothing more than an empty shell of their former selves. Profit can come in two ways, by games that are genuinely good and offer an experience that are great and loved by many. Profit can also be gained by taking over developers and riding the success of certain properties until those properties are run into the ground.
Magnum PI
20-Dec-2004, 23:50
of the fifteen GC games i bought, no one is an EA game.
at least we can vote with our money.
Riddlewire
20-Dec-2004, 23:57
Anyway, I really wish someone would stop EA, but I don't know anyone who would.
Well, I figure it could be done (stopping them, that is), but it would require lots of cooperation. The gaming websites, ALL of them, and the gaming magazines, ALL of them, would have to reach a collective agreement to not give any coverage to any EA game. They would have to agree to pretend that EA just didn't exist and never mention them. About two years' worth of that would definitely have an impact.
I don't see any way that you could get the Big Three on board, though (and with consolidation, I guess they're the Big Two now).
Microsoft could allways buy them.
Anyway what will happen is the talent will leave ea after thier companys are bought. Start thier own companys . make a few good games , get bought by ea and then do it all over again
Magnum PI
21-Dec-2004, 00:02
according to this article:
http://news.bbc.co.uk/2/hi/business/4112605.stm
EA's stake would give it access to 18.4 % of the voting rights against 22.8 % held by Ubisoft's founders
Sega had better tuck their pants under their socks because they're next.
I don't know why EA is buying all these developers. They're moving jobs to China as soon as possible, I'm sure. Just for licenses and IP, perhaps?
Anyway, I really wish someone would stop EA, but I don't know anyone who would. Ubi isn't NEAR big enough to outmuscle EA. No 3rd party is. And all the console makers are busy sending congratulatory emails to EA in hopes they won't have to pay quite as much to get all of EA's games next time.
And if anyone purchased EA (and the sale actually got approved by various governments), they would become the new EA. How could you reform all EA's assets?
The Nintendo Revolution...
"Look, we can buy up important developers too!"
Brimstone
21-Dec-2004, 00:40
EA clearly has great management at all levels of their organization. At the end of the day it's about making money and EA has done that and their stockholder/investors have been rewarded. Their track record of consistently making a profit is what allows them to buyout or do a hostile takeover in the case of UBI. Not everything they touch turns to gold, but they do a good job of making games video game consumers buy. People like great games and EA provides them to many peoples satisfaction.
EA is a large corporation, and they are doing whats needed to grow their company in a profitable manner. This isn't easy, but they seem to be on the right path. If they miscalculate other company's will take advantage of any errors EA makes. This is captialism at its best.
People aren't forced to work for EA. A great example of this was the former Medal of Honor team which left the company and made Call of Duty. The same could happen with some UBI team members if they don't like the view once EA takes over.
The simple fact is if you don't like EA, don't buy the games. While I don't end up buying many EA games myself, the ones I do purchase I get good value from them.
OK EA is obviously the most flagrant offender in buying out studios and IP. But are they the only ones?
Did Command and Conquer suffer after they took over Westwood? I don't know the WC or Ultima series. Can someone recap what happened after each of their acquisitions instead of making a blanket claim that the games they acquire become bad?
Because it seems to me that one of the things smaller studios do is try to put together a game, get noticed and get bought out. Not in this Ubisoft case but in most of their other acquisitions, it sounds like the smaller studios were willing participants in the acquisition.
That is because games, like movies, have become sequel-driven, as publishers seem only interested in funding proven franchises. And rather than develop original IP, they acquire smaller studios and publishers with games which have sold well.
Sure there have been original games introduced this generation. The EA Big had a bunch of games released. But only SSX, NFL Street and NBA Street appears to have reached sequel status. It seems the ratio of sequels to original games is pretty high these days. The next generation will be an opportunity to release some original games and some of those will no doubt get on the sequel train.
Besides other games publishers being risk-averse with anything but proven properties, you see movie studios doing sequels or remaking old movies or making movies out of cartoons and old TV shows.
Such is the state of the creative industries...
Brimstone, it's nice that you wish to defend EA but I could care less if it's a smart move for them. It is bad for the industry period. I've seen too many devs get bought up by EA only to be digested and the end product being released is dung. Is that what you want? Look what happened to Bullfrog. Looked what happened to Origin. The properties of those teams were drowned out and turned to crap. It will happen again with Ubi Soft if they do indeed get gobbled up by EA.
I love the business aspects of the industry but not when it comes to threatening the quality of the games out there. EA may make some great games, but 1 out of 5 is a very bad ratio of great to crap in my book.
To the comment of the one who said SEGA is next that is laughable. Sammy has a firm grip on SEGA and the last itme I checked it would be quite hard to get any controlling interest in Sammy for the mere fact that one man has more share then EA would be able to attain.
Joshua Luna
21-Dec-2004, 02:16
Interesting...
Last week it was reported (http://www.gamesarefun.com/news.php?newsid=4026) that the EA bid to buyout DICE (the developer of Battlefield 1942 which sold more than 4 million copies) had failed.
Well, fast forward to today. It is now reported (http://www.gamespot.com/news/2004/12/20/news_6115399.html) that EA has revived its takeover bid and convinced Bonnier & Bonnier, who own 25.6% of DICE, to vote in favor of the takeover. EA has left its offer on the table until Jan 20th, 2005. EA still needs the approval of parties controlling, at minimum, 90 percent of DICE's voting shares for the acquisition to take place.
So lets see...
• Obtain NFL Exclusive and eliminate professional football competition across the board. CHECK.
• Begin buying out one of our largest competitors. CHECK.
• Buy out developer of extremely successful PC series that is being developed for next gen consoles. Soon to be a: CHECK.
EA has been busy this Christmas season. I would sure hate to pay those credit card bills! ;)
Prediction time: What next? We got one guess Sega is next. Any other guesses??! For some reason I do not think EA is done... could NBA/MLB Exclusives be far behind? Now this is something worth speculating :)
passerby
21-Dec-2004, 02:16
So after all the great licenses and studios are devoured and become no more... video-game industry crash of the 'West', here we come again!
Old news, but the resistance is fighting. (GamesIndustry.biz)
Publisher Midway has announced that it is making a new American Football title which will be based on the ESPN's Playmakers TV show, rather than on the now-exclusive official NFL license.
The game will follow the fortunes of a fictional professional football league, and will feature behind the scenes features such as office politics at the teams as well as on-field violence - topics which the squeaky-clean NFL image would forbid from inclusion in an officially licensed game.
"Midway's Chicago studio has laid the foundation over the past year for what is the ultimate alternative to watered down NFL sanctioned football games," according to Midway's chief marketing officer Steve Allison.
"No longer bound to the NFL license, there will be no league restrictions on content and gamers will finally experience what makes playing a football videogame really fun: off-field controversies, dirty hits, excessive celebrations and much more," he continued. "Blitz: Playmakers buyers will be assured of one thing - our game will include all the gameplay and fun the NFL won't allow."
Although Midway has been working on Playmakers for around a year, today's announcement reads like a direct response to EA's acquisition of the exclusive license to the NFL and its players earlier this week.
EA's five year license will prevent any other game publisher from releasing a game featuring official NFL brands or teams, or player names and likenesses from NFL players.
Midway plans to ship Blitz: Playmakers on multiple console platforms in Q4 2005.
Joshua Luna
21-Dec-2004, 02:25
So after all the great licenses and studios are devoured and become no more... video-game industry crash of the 'West', here we come again!
I was thinking about this lately also... about how the video game industry collapsed in the early 80's. I know that what EA is doing is good for EA and stock holders, but I am concerned about what this means for the industry. While these moves are good for investors, moves that hurt the quality of the product is bad because consumers may choose to spend their money elsewhere. Competition is one thing that keeps the quality of products high. I guess we get to watch how this plays out... anyone have popcorn?
Was EA around during the first market crash or did they rise from its ashes?
Did Command and Conquer suffer after they took over Westwood? I don't know the WC or Ultima series. Can someone recap what happened after each of their acquisitions instead of making a blanket claim that the games they acquire become bad?
Wing commander was the name for space sims at that point in time and suddenly its gone just like that
Ultima was one of the most sucessfull if not the most succesfull rpg series for the pc up till that point.
They took it over and rushed out ultima 9 and pumped out horible expansions for ultima online.
They killed both of these propertys .
Joshua Luna
21-Dec-2004, 02:54
Was EA around during the first market crash or did they rise from its ashes?
EA was founded in 1982 according to their website (sorry no link, it was a popup page under corperate info). I believe Trip Hawkins was one of the founders. Anyhow, whether they were founded during, or after, the first market crash depends on where you place the crash and how long it was crashed.
Personally I would look at the 1984-85 time frame, when the Nintendo came out with the NES, as the end of the crash. But that is just my opinion. Obviously EA was not a cause of the first crash, and I do not remember playing a lot of EA games when it rejuvinated either. They definiately hit the market when it hit an up-cycle although back then Nintendo, Sega, Capcom, etc... were the ones really pushing the market forward. That was a long time ago and I was only a kid, so I do not remember a lot... some of the veterans here could probably shed some light on this.
My first EA game was Madden though, I am pretty sure of that.
Was EA around during the first market crash or did they rise from its ashes?
EA was founded in 1982 according to their website (sorry no link, it was a popup page under corperate info). I believe Trip Hawkins was one of the founders. Anyhow, whether they were founded during, or after, the first market crash depends on where you place the crash and how long it was crashed.
Personally I would look at the 1984-85 time frame, when the Nintendo came out with the NES, as the end of the crash. But that is just my opinion. Obviously EA was not a cause of the first crash, and I do not remember playing a lot of EA games when it rejuvinated either. They definiately hit the market when it hit an up-cycle although back then Nintendo, Sega, Capcom, etc... were the ones really pushing the market forward. That was a long time ago and I was only a kid, so I do not remember a lot... some of the veterans here could probably shed some light on this.
My first EA game was Madden though, I am pretty sure of that.
Probably was for most other people as well.
I think my first EA game was Caveman Olympics on the commodore 64. I remember being surprised that EA made a game that wasn't a typical crappy(in my non-athletic opinion) sports game.
Brimstone
21-Dec-2004, 03:31
Brimstone, it's nice that you wish to defend EA but I could care less if it's a smart move for them. It is bad for the industry period. I've seen too many devs get bought up by EA only to be digested and the end product being released is dung. Is that what you want? Look what happened to Bullfrog. Looked what happened to Origin. The properties of those teams were drowned out and turned to crap. It will happen again with Ubi Soft if they do indeed get gobbled up by EA.
I love the business aspects of the industry but not when it comes to threatening the quality of the games out there. EA may make some great games, but 1 out of 5 is a very bad ratio of great to crap in my book.
To the comment of the one who said SEGA is next that is laughable. Sammy has a firm grip on SEGA and the last itme I checked it would be quite hard to get any controlling interest in Sammy for the mere fact that one man has more share then EA would be able to attain.
Threating the quality of games according to who? People that don't matter to stock holders obviously because lots of people buy their games and enjoy them. EA's stock price reflects a job well done. People buy EA games because they like them. People have voted with their dollars and have chosen EA for their souce of video game entertainment.
They have shown leadership by connecting with the consummer, and show no signs of stopping to have the midas touch. If EA is doing such a bad job, why are they thriving? Everyone is entitled to their own opinion in what they like and dislike, but because you disagree doesn't mean the quality is bad for everyone.
If you love or hate the SIMS it doesn't matter. People voted with their money and bought a lot of copies of that game. This goes for all EA games.
I'm not defending EA, I defend capitalism.
Well yes according to me. When you have perfectly good franchises being run into the ground for the simple word being money then that is a very major problem whether you wish to face it or not. People do vote with their money and I'm happy it is working out for EA, but do you honestly want them to gobble up every great gaming dev out there only for those devs to turn into mediocre dev houses?
In the end it probably won't be good for the consumers that EA is achieving such a big share of the market. Capitalism may be a great thing (which I agree with you 100%) but EA is treading on very dangerous ground. If it keeps going the way it is EA will have to rely on themselves to anything. They will not be able to command Sony or MS around when it comes to the very end of it. MS itself has plans to increase its 1st party devs threefold despite the recent sale of the remaining XSN dev houses. Sony is increasing the quality of its 1st party dramatically through each gaming generation. EA is looking for growth, but the question is will they be able to retain the level of sales they've been getting or even sustain their current growth? What will happen if Japanese devs and publishers make the big comeback that analysts are predicting will happen?
Buying up small dev houses that churn out quality game after quality game is not a good thing for the consumer. If EA is able to make the next Burnout as good as the third installment then I will applaud them with a standing ovation. The same goes if they gobble up Ubi Soft. But if their titles and games turn into lower quality then it will be for the worse. You should agree with that.
If you love or hate the SIMS it doesn't matter. People voted with their money and bought a lot of copies of that game. This goes for all EA games.
Unfortunately, sales don't necessarely reflect "quality" which is the fallacy of your argument. The mass market that buys into EA products is lured into thinking that the strong name of a game-title equals a quality purchase as well (can you blame "him" after liking the corresponding movie?), when in fact there are many more, better, innovative games out there that lack the money to make a big showing and be competitive with a publisher like EA.
Sales of EA games with rights to big-names / high profile movies should show you that - and the corresponding average rating of those titles as well. Selling games purely on their name and feature list (while cutting down on resources, costs) is sadly working out for EA.
Is EA cutting staff when they acquire companies? No doubt the bean counters try to squeeze out "redundancies."
But aren't their staffs among the largest?
Seems like the games have a lot of production values -- big soundtracks, lots of features, etc.
Doesn't really seem to square with the contention that they are cutting corners.
Inane_Dork
21-Dec-2004, 05:07
MS itself has plans to increase its 1st party devs threefold despite the recent sale of the remaining XSN dev houses.???
This would be (welcome) news to me. Have any source for it, or is it just speculation?
A company the size of Sega Sammy is far out of the price range for EA. When the SEGA deal between CSK and Sammy occurred last year, EA looked to partners/creditors when considering a bid to finance only a portion of the company's shares. The Sammy merger has more than doubled the full value, and the new company is aggressive in their independence. They've also just announced a large share buyback.
EA did have a lot of funds left over for potential acquisitions after looking into SEGA, though, so it's not surprising to see them go for a string of moves.
My first EA game was Madden though, I am pretty sure of that.
My first EA game was Populous.. I loved that game!
Inane Dork, it is not just speculation. I have no link or source to confirm it, but going by a few individuals who work for MS the seem to be eager to make a bigger chunk of money from the software side next time around. MS can't rely on the Halo name for everything. And I wouldn't be surprised if there wasn't another Rare sized developer added to the MS list.
Joshua Luna
21-Dec-2004, 18:44
Inane Dork, it is not just speculation. I have no link or source to confirm it, but going by a few individuals who work for MS the seem to be eager to make a bigger chunk of money from the software side next time around. MS can't rely on the Halo name for everything. And I wouldn't be surprised if there wasn't another Rare sized developer added to the MS list.
Hopefully if they get another RARE sized developer they get more production ot of them. I know before MS bought RARE there had been talk of how RARE had lost a lot of their lead talent. e.g. Some key members from the Goldeneye 007 team left and formed FreeRadical, the makers of the TimeSplitters series. RARE has made some awesome games in the past, and I hope for MS sake that they have been dumping all their efforts into Xbox2 release titles. I would be disappointed if a Perfect Dark game did not come out in 2005. PD in 2005 and HL3 in 2006 would be a pretty good One-Two for MS, maybe even a Banjoo-Twooie. I guess we can wish :)
Inane_Dork
21-Dec-2004, 19:12
Inane Dork, it is not just speculation. I have no link or source to confirm it, but going by a few individuals who work for MS the seem to be eager to make a bigger chunk of money from the software side next time around. MS can't rely on the Halo name for everything. And I wouldn't be surprised if there wasn't another Rare sized developer added to the MS list.Interesting. Thanks for the answer.
Ebert and I give you two thumbs up. ;)
Sometimes it feels if EA is looking for someone to buy it out. It is beefing up its protfolio for possible future investment from a big movie company maybe. It would be inmteresting to see someone like Fox or Universal make an investment in EA.
Sometimes it feels if EA is looking for someone to buy it out. It is beefing up its protfolio for possible future investment from a big movie company maybe. It would be inmteresting to see someone like Fox or Universal make an investment in EA.
Or Columbia or MGM...or Pixar... :shock:
pixar? they don't have enough money to buy EA. probably the other way around ;)
pixar? they don't have enough money to buy EA. probably the other way around ;)
The question is would an EA-Pixar endeavour save the world from another FIFA 2xxx sequel! :P At least we'd get nice motion blur! :)
megateto
21-Dec-2004, 20:49
I read this in http://forums.gaming-age.com/showthread.php?t=28563
Source: WSJ Online
Video game makers face an ''arms race''
Several other sequels, including "Grand Theft Auto: San Andreas" and "Doom 3," have lived up to their blockbuster billings -- and Hollywood-level budgets. U.S. videogame sales are expected to rise 10% this year to $7.76 billion, according to Wedbush Morgan Securities.
[...]
"If you're not making a lot of money right now, you're not going to make it in the next generation," says Jeff Brown, vice president of communications for Electronic Arts Inc., the publisher of "Madden NFL 2005" and the industry leader with annual sales of nearly $3 billion.
How do the hardware makers feel as one single publisher holds almost half of their market. I know 3rd parties are a must for the industry, but isn't EA too big?
Johnny Awesome
21-Dec-2004, 21:34
The first number is for US software and the second is for EA's worldwide sales.
EA is about 25% of the gaming market right now.
It's like I said before, any console will depend on EA support for survival.
megateto
21-Dec-2004, 22:04
The first number is for US software and the second is for EA's worldwide sales.
EA is about 25% of the gaming market right now.
Thanks for the clarification. 50% is scary, 25% is enough to begin to worry about. Mmm, or at least I think so (but just a thought, I'm not an expert, not even an aficionado...).
Magnum PI
21-Dec-2004, 22:05
PS3 will live, even without EA support..
if this happens (and it won't), EA will suffer more than sony.
Inane_Dork
21-Dec-2004, 22:16
PS3 will live, even without EA support..True, but Sony would have to kiss North American and possibly European leadership goodbye till PS4. And considering the size of those markets, I rather doubt Sony would let that happen easily.
Though I am sure MS would love to turn the GTA3 thing back on Sony and raise the stakes. EA represents astronomical stakes, though.
PS3 will live, even without EA support..
IMo not a chance.
if this happens (and it won't), EA will suffer more than sony.
Typically in consoles, software drives hardware sales, not the other way around.
Joshua Luna
21-Dec-2004, 22:50
PS3 will live, even without EA support..
if this happens (and it won't), EA will suffer more than sony.
I disagree, I think Sony would be hurting a lot more than EA.
I think PS3 would live, but I think it would lose its domination position in the US--it would be killer PR and it would put a dent into their PS3 goals and profits. How would Sony handle selling 40mil PS3 versus 75? That means a lot let software being sold and thus less royalties. I think EA would do fine (I am sure they would get some serious kick backs, not to mention the other platforms will sell). If EA decides to ignore a platform it will be a serious killer in the US. Out of the big Three Sony would be able to take this blow the best, but if EA went with MS/Nintendo I could easily see Sony being losing market position, especially with the Xbox2 rumored to come out next year. It is all about the games, and Sony would have a massive hole in their library and would have given their competitor a one year headstart.
EA dumping any platform would be traumatic. e.g. No NFL Football. That is a pretty big market of people to lose out on. One of the key areas the PS/PS2 has been a leader is in sports. If you took away the NFL, FIFA, NASCAR, Tiger Woods, NBA Live, MVP Baseball, NHL, Fight Night, NCAA Football, etc... that would totally decimate a sports lineup. While other developers could fill some of these holes, they could never fill the Professional Football void with the exclusive. I think Madden and ESPN sold 5million copies this year... those are 5 million reasons to buy another console if EA abondons a platform.
And when you begin to consider EA's other brands & movie tie ins: Battlefield, The Sims, Medal of Honor, Harry Potter, LoTR, James Bond, NFS, Burnout, and so on. EA had 22 games sell over 1 million copies last year. They are huge. I do not own a lot of EA games, but there is no denying how massive they are.
And if that was not enough... think of the N64. The N64, while a financial success, is where Nintendo lost their market leadership. Why? 3rd party developers were going elsewhere. Where ever EA goes, and all the EA exclusives, that means there will be consoles sales. Install base means profits. In general, if I am a developer and want to make money I go to the biggest install base.
And if you start to consider how much Sony has invested into the PS3 and how much they may lose per console sold, losing the biggest 3rd party publisher would be bad news.
Just my opinion... but I do not think anyone--Sony, MS, or Nintendo--can afford to lose EA support if they wish to stay in the mainstream. Nintendo looked pretty intimidating back in the day, but they lost their market leadership. No one is immune.
Maybe I overestimate EA, but 22 million sellers in one year is pretty amazing. Maybe Bill Gates sees this thread and is putting in some of his own money to buy EA :) I do not think anyone, even Sony, is immune to EA.
Joshua Luna
21-Dec-2004, 22:51
Typically in consoles, software drives hardware sales, not the other way around.
Thanks, that is a lot clearer and more consise than what I said! :oops:
;) your was more thorough
So hears a thought....
The last thing EA wants is for a single dominant hardware platform, if that were the case they would loose all of their leverage.
So.... Perhaps their being so big isn't such a bad thing.
Unless of course you believe that a hardware monopoly is for the best.
MaximilianSWE
22-Dec-2004, 00:18
MS and EA will most definatly team up one way or another..
EA wouldn't be able to justify the expense of some of their production and of some of these licenses if they weren't selling the games to enough of the available market, which may be spread across several platforms. Also, some of the licensors might not grant their properties to EA if EA's plan is to restrict the brand's exposure to fewer markets.
So hears a thought....
The last thing EA wants is for a single dominant hardware platform, if that were the case they would loose all of their leverage.
So.... Perhaps their being so big isn't such a bad thing.
Unless of course you believe that a hardware monopoly is for the best.
As opposed to a software monopoly!?
Perhaps a hardware monopoly would mean cheaper dev costs for them with no more cross-platform development? And perhaps that will bring them closer to, dare I say it, Trip Hawkins 3DO vision...dun dun dun....! :twisted:
Of course no kind of monopoly is good for the consumer! :P
EA is a full-tilt multiplatform publisher. If they even neglected a significant market too much, they'd be undermining their ability to maintain the dominance which supports their massive operation. They held out on Xbox Live, and they later lamented a marketshare defeat to SEGA in the Xbox sports gaming sector for not matching the product of their competitor. If they didn't already own the exclusive rights to the NFL license, they wouldn't spare a dollar in making Madden the best game it could be on every platform in which Sega's NFL 2Kx would also be competing, system politics or not.
Joshua Luna
22-Dec-2004, 05:57
EA is a full-tilt multiplatform publisher. If they even neglected a significant market too much, they'd be undermining their ability to maintain the dominance which supports their massive operation. They held out on Xbox Live, and they later lamented a marketshare defeat to SEGA in the Xbox sports gaming sector for not matching the product of their competitor. If they didn't already own the exclusive rights to the NFL license, they wouldn't spare a dollar in making Madden the best game it could be on every platform in which Sega's NFL 2Kx would also be competing, system politics or not.
That is a big "if". As it stands now system politics are relevant because there wont be the ESPN 2Kx competition, at least not with professional football.
It will be very interesting to see what happens when EA does not like the royalties on a platform, or does not like the direction of online revenue sharing of a platform, or feels a platform is no longer worth supporting, or whatever reasons can be found to use your muscle to get things they want. EA has some mass. It reminds me of a comment from their CEO that console makers spend 2 years before the consoles come out trying to get on their good side and then spend the next 3 or 4 years, after the console launches, acting like they do not exist. I think the dynamic is maybe swinging the other way some...
That is a big "if". As it stands now system politics are relevant because there wont be the ESPN 2Kx competition, at least not with professional football.
How is that a big "IF" when that is how it currently works? If anything, the situation where EA decides to say, support only XBox2 or GCN2 is a MUCH bigger "IF" because that's a huge risk.
Joshua Luna
22-Dec-2004, 23:10
That is a big "if". As it stands now system politics are relevant because there wont be the ESPN 2Kx competition, at least not with professional football.
How is that a big "IF" when that is how it currently works? If anything, the situation where EA decides to say, support only XBox2 or GCN2 is a MUCH bigger "IF" because that's a huge risk.
I was directing my "if" comment at this: "If they didn't already own the exclusive rights to the NFL license, they wouldn't spare a dollar in making Madden the best game it could be on every platform in which Sega's NFL 2Kx would also be competing, system politics or not."
I still believe system politics are still relevant; and the dynamic of console politics HAS changed. EA no longer has to complete with ESPN NFL2Kx, and in turn can use their exclusive status to offer feature exclusives, like online play, to whoever they see fit IF they believe it is in their best interest. Don't believe me? Xbox Live is proof they WOULD do this. Will they not support as platform they do not think lines up with their goals? Dreamcast. EA is about making money, but that does not mean they need to support every platform and every features. They have a long term goal, and if they feel certain political issues get in the way of the big picture of longterm profits I don't doubt for a second that they would not act.
The stakes are a lot higher now with EA seeking exclusives on professional sport monopolies. I think Qroach put it pretty clearly that software pushed hardware sales. A new generation = a new ball game. If EA feels Nintendo, MS, or Sony has philosophies about royalties, online play, console features, etc... that do not mesh with their own plans, I would expect them to do what they feel is best for THEIR business. We have already seen this with not supporting the DC, and not supporting Xbox Live. EA would have made more money in the short term supporting DC and Xbox Live, but they felt the situation was not right for their business. I highly doubt it will be the last time they make such a decision. So I do not believe it is out of question for EA to drop support of features, and if sales are bad enough (or sale projections), a platform. Sometimes the big risk is supporting something, and not supporting it.
And check this out:
http://sports.ign.com/articles/574/574539p1.html?fromint=1
EA is going after an NBA exclusive. I would guess MLB and NHL are in the works also based on the speculation from news reports on the day of the NFL exclusive.
So it is not an "if" but a what/when question. System politics are extremely important to EA and the stakes are higher now with EA gobbling up exclusives. I expect EA to sell certain new features in their sports lineup, especially Madden, to the highest bidder. e.g. Sony/MS paying for a one year exclusive on online play. I can see selling such exclusive features as being good PR, good system sellers, and also good for EA to help make up for some of the big money they spent on the exclusive license. And these features would be valuable because, unlike in the past where you had Fever and ESPN competiting, Madden is the only game in town. MS/Sony/Nintendo do not have a backup for losing features in the EA franchises. So yeah, I would say making EA happy is pretty important at this point.
As for the Sony discussion, that was a tangent on a totally unlikely hypothetical question. I would not expect EA to drop Sony support... but the point was that EA support is important for all of the Big Three.
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