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EA: digital is “what we’re all about”, 76% of Q1 revenue

Wednesday, 24th July 2013 01:26 GMT By Brenna Hillier

EA made 76% of its revenue from digital business last quarter, and the publisher “burned the ships and marched inland”, according to EA Labels boss Frank Gibeau.

Back when a John Riccitiello-led EA first started probing the waters on digital, moving to an online-focused business model was seen as wildly experimental. Speaking to VentureBeat, Gibeau said that’s not how EA saw it.

“It’s not an experiment. It’s a full commitment. We burned the ships and marched inland,” he said. “About 76 % of our revenue this quarter was digital, not disc-based. We’re off to the races.

“The digital capabilities of the next-generation consoles are extremely powerful. The business is going digital. Mobile. Asia. A significant part of the business is in Asia. Does that mean retail is going away? No. But it’s not an experiment. It’s what we’re all about.”

Gibeau acknowledged the lack of triple-A releases in the last quarter skews the figures somewhat, but pointed out that Apple was EA’s biggest retail partner.

“That’s never happened before. John Riccitiello started us on this course, but we embrace it, we support it, and we’re going to take it to new heights,” he said.

EA made quite a lot of its revenue in the mobile sphere, and Gibeau said the publisher’s early decision to “go where the audience is” has paid off.

“We’re seeing console game levels of return, financially, on these projects. We’re seeing audiences that are vastly bigger. Our creative times are intrigued by designing games for mobile devices,” he said.

“The touch screen, the technology — the technology on the next wave of tablets is going to be near-console-level in terms of graphics performance.”

Mobile has driven most of EA’s growth since the last transition, Gibeau said.

“We were a $20 billion business back in 2004 or 2005. Now it’s north of $60 billion. A lot of that growth has been the opening up of Asia, but it’s also been the opening up of mobile at scale as a gaming platform.,” he explained.

The executive said mobile isn’t just great for EA – by keeping entry barriers low, it’s fostering indie developers, too, and he believes independents are driving innovation.

“It’s a really great time to be an indie. You’d have to go back to the early days of gaming to find a time when there was this much accessibility and creativity pouring into our art,” he said.

“It’s now clear that AAA games and mobile will co-exist. Some people went to E3 saying that the tablet killed the console. Most have stopped saying that now. Everyone I know plays both. Mobile games and consoles are on terrific growth trajectories.

“I think that independent developers will continue to flourish. Indie games on mobile and tablets will continue to get more sophisticated and the audiences will continue to scale massively. As that happens, developers of AAA titles will learn how to integrate the creativity we’re seeing from the independents.”

The full interview on VentureBeat has lots of interesting take-aways, from the greenlight process for Plants vs Zombies: Garden Warfare, to DICE’s continued growth, to how EA has reacted to being labelled worst company in America yet again. Do click through and have a read; it’s lengthy, at three pages, but worth it.

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5 Comments

  1. alterecho

    As long as AAA gets released through retail, without any kind of online activation stuff.

    #1 1 year ago
  2. stealth

    EA should just shut up. They are basically saying yay we like mobile so we can put shitty shovelware on it and suck money from people with microtransacitons

    #2 1 year ago
  3. polygem

    no problem. it´s all about pricing though. i hope consumers wont buy into digital if they don´t make the shift to it more fair. so glad the xbox one bombed so plans needed to change. i hope people will continue to look at the digital market very very carefully. the moment people start to buy in larger numbers things are set. right now is the chance to wait things out a little longer, observe what the industry does with this idea and then only buy into it if you think the deal is fair – for the industry and the consumer.

    #3 1 year ago
  4. THWIP71

    “About 76 % of our revenue this quarter was digital, not disc-based”….”Gibeau acknowledged the lack of triple-A releases in the last quarter skews the figures somewhat, but pointed out that Apple was EA’s biggest retail partner”.

    He just completely disqualified his first statement. No major disc-based releases in a qtr + majority of sales are from a primarily digital-only platform = LOW DISC-BASED SALES #S, DUH!

    To borrow a bit from Thumper’s mom: If you can’t say anything INTELLIGENT, don’t say anything at all.

    #4 1 year ago
  5. GrimRita

    Funny how 90% of this revenue has been generated by IP they bought and didnt create themselves. Clever, or just a clueless and uninspiring company?

    BTW Frank, hows the Madden IP been treating ya? Heard you’re kind short $11 million?

    #5 1 year ago

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