EA’s chief financial officer Blake Jorgensen has said next-gen will be a more cost effective transition for the firm, and part of this has to do with Frostbite being the firm’s proprietary engine.
Speaking during the Goldman Sachs Technology and Internet Conference, Jorgensen said EA plans to leverage its “core group of ten-to-fifteen titles” on next-gen, and keep R&D under $100 million, unlike the last console transition where EA had “way too many titles” available.
“Historical transitions have been bumpy for a few reasons: one, because a lot of the companies had too many titles,” he said. “We had way too many titles in the last transition, and the more titles you have, the more expensive it is to convert from one generation to the next. We are much more focused now.
“We have a core group of ten-to-fifteen titles which we’ll stage in terms of the transition and manage costs through it. The goal is to keep the cost increase for R&D under $100 million.”
Jorgensen said the R&D costs will be spread between 2013 and 2015, while at the same time being “receptive” to what next-gen consoles will cost. He doesn’t think the price difference between current and next-gen will be as “dramatic” as previous years, and having Frostbite ready to roll on next-gen will be cost effective, unlike current-gen which was “a big task.”
“We have always been moving Battlefield well ahead on specs because of the PC embedded base business,” he said. “So moving from gen-three to a gen-four is not a huge rise in costs, and since we’ve been building those types of titles on Frostbite, which is our proprietary engine, once you’ve done that, you now can do it for multiple titles as long as they use the Frostbite engine.
“This has been going on over the last year, and the early look on some of these products is spectacular.”
Activision, on the other hand expects development costs to go up with next-gen. During its financial call to investors last week, CEO Bobby Kotick said new tech always causes an increase in costs, and this “transition will not be an exception.”
Sony is expected to announced its next PlayStation in New York City next week, and Microsoft is expected to reveal its next Xbox platform at E3 in June.
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