As Electronic Arts starts earning more money from digital sales, the videogame publisher believes “Star Wars: The Old Republic” will serve as the kind of title that will put more coin in its coffers in the future.
“Old Republic,” which bows Dec. 20, marks an unusually large expenditure for the company.
“It’s the greatest investment EA’s ever made in a title,” said EA chief financial officer Eric Brown while leading a candid sesh at UBS’ Global Media and Communications confab Monday.
While he wouldn’t cite a specific figure, Brown answered nudging from the aud by saying that a first-tier game’s budget might reach $25 million, and that “Republic” exceeded that number.
Brown also emphasized the popularity of the beta test for “Republic,” in which more than 2 million users signed on to help EA test the game for free. Over Thanksgiving weekend alone, “Republic” attracted 750,000 unique users for an average of four hours a day over three days — stats that bode well for the subscription-based game.
Brown suggested that EA hopes “Republic” will unseat reigning massively-multiplayer online champ “World of Warcraft,” which debuted in November 2004 — the early Cretaceous period, in vidgame terms. “We believe the market is ready for a new MMO,” he said.
Though EA’s profits continue to grow, its mobile sector took a major nosedive in 2011, with the company’s mobile gaming revenue falling from $234 million to $113 million this year. Brown blamed consumers’ rapid adoption of smartphones for the shortfall; mobile gaming is done almost exclusively on iOS and Android phones, leaving little space left for games on other phones.
Helping to amortize that dip was a marked uptick in downloadable content sales, in which players buy extra levels, virtual items for use in-game, and playable characters — “microtransactions” worth hundreds of millions of dollars in aggregate for the company. EA’s “Battlefield” franchise, which is locked in competition with the “Call of Duty” series at rival Activision, drives much of the biz.
Brown also broke down digital sales for “Battlefield: Bad Company 2” and the company’s latest installment in its “FIFA” franchise (popular internationally). Including projected sales for December, the former pulled in $82 million, the latter $64 million, both in digital sales alone. “Battlefield 3” was released in November, selling more than 5 million copies in its first week.
Brown also discussed the increasing viability of download sales, saying that the margins on that sector of the business were very impressive. “We see probably 90% gross profit before advertising,” he said. Overall, the company’s digital revenue for 2011 comes to $904 million to date.