EA expects to make $1 billion from extra content this year, bets on sports titles

#1
Saw this article on Bloomberg

The change is one of dozens of new features in Madden NFL 15, the rendition of the Electronic Arts Inc. (EA) title that came out today and that analysts including Doug Creutz of Cowen & Co. expect to generate more than $350 million in revenue.

The forecast is for sales of the game, retailing for about $60, and of the so-called extra content available online -- the Ultimate Team players, jerseys, coaches, playbooks and stadiums that can make video-play close to the real thing. Some fans will spend more on the extras than the basic software.

“The margins on Madden Ultimate Team are through the roof,” said James Hardiman, an analyst with Longbow Research LLC who has a buy rating on the stock.

Ultimate Team sales could total more than $50 million and those of the game itself about $300 million, said Creutz, who also rates the stock a buy. For EA, “the opportunity is to get more dollars per unit.”

Revenue from extra content for all its games may reach a record $1 billion this year, according to the company.Madden NFL 15, along with other sports titles, will be a “major contributor,” said John Reseburg, a spokesman for EA. He declined to comment on whether sales would continue to be as strong as they’ve been: Madden NFL extra content revenue grew 350 percent in the quarter ending June 30 from a year earlier.
http://www.bloomberg.com/news/2014-...ressure-for-russell-wilson-in-madden-nfl.html
 
#5
As fashionable as it is to complain about EA and call them names, they are obviously providing people with what they want to buy and play, or they wouldn't have such lofty goals.
 
#8
I've been saying for a while that Ultimate Team is the reason why they suddenly decided to keep servers up for sports games longer than they used to.

Good thing in my opinion though.
 
#12
With how much people I know have spent on FIFA Ulimate Team over the last few years, it doesn't surprise me. I know individuals who are into four-figure spending, a year.
 
#16
Not from me they're not. EA's dominance really needs to be quelled. They're not fit for it, and too many times now they've screwed consumers over. For one, I hope PES claws back the title from Fifa eventually.
 
#18
As fashionable as it is to complain about EA and call them names, they are obviously providing people with what they want to buy and play, or they wouldn't have such lofty goals.
Ahh the ole "it's fashionable" bit. There are many very good reasons why EA gets criticized it's not just so we can be in the "cool" crowd lol.
 
#22
Hasn't failed them yet!
The strength of the license, man.

Sigh, just one year.

I just want to see one year, where EA lets 2K share the NFL license ( they can make theirs too!), and give Konami the right to the FIFA name, whereas their own football game has to use a generic name, and see if they can even muster half the sales they usually get.
 
#23
As someone who's only interaction with Ultimate Team each year is opening the free stuff (and maybe buying a pack or 2 using the points you get from playing old versions of the game), I'm fine with this. Obviously, lots of people care about this, but you can pretty much ignore it if you don't want to touch it and not miss out on anything
 
#24
i feel like im the only person who buys fifa every year and doesnt touch ultimate team or spend any additional money on it.
You're a stronger person than I am. In any case FIFA Ultimate Team is so much fun to play for me. I don't take shame in having spent a good chunk of money on buying packs so that I can then be sad when they are all terrible. It's not a mode for everyone but it's pretty dam fun. I will be there day 1 for FIFA 15.
 
#25
As a consumer, I have disliked EA for a long time because I despise their business models, but even I have to admit that no one is forcing their consumers to spend money on Ultimate Team. This is a mode where an individual's' progress does not carry over from year-to-year, and yet people are stupid enough to spend a ridiculous amount of money annually creating "their team".

As a publically traded company whose sole mission is to generate profits and increase shareholder value, EA is right to continue the business model.
 
#27
This is one of the major financial motivations behind EA Access. They get a ton of revenue from their Ultimate Team games, which to their credit, are very fair and content-packed trading card mini games that are worth it for people who are into that... and they don't encroach anywhere on the singleplayer/core game.

If they put Madden '15 on EA Access in .. say .. April, right before the draft, a ton of people will download it, and then they can release draft day special edition MUT cards for $$$ and make a killing.
 
#28
^-- yeah, I tried to point out the day they announced the subscription that in almost all the games at least half of the revenue was from secondary revenue. to get bf4 premium (map packs) you're spending more than the game is worth. even worse is the feeling of sunk costs for people when they buy dlc for these games. it's a good form of lock in (for the publisher)
 
#29
This is one of the major financial motivations behind EA Access. They get a ton of revenue from their Ultimate Team games, which to their credit, are very fair and content-packed trading card mini games that are worth it for people who are into that... and they don't encroach anywhere on the singleplayer/core game.

If they put Madden '15 on EA Access in .. say .. April, right before the draft, a ton of people will download it, and then they can release draft day special edition MUT cards for $$$ and make a killing.
It's so fucked up... I personally think HUT is the bane of sports games.
 
#32
As fashionable as it is to complain about EA and call them names, they are obviously providing people with what they want to buy and play, or they wouldn't have such lofty goals.
And Bank of America was just obviously providing people with the loans they wanted to buy their houses. The mass market is filled with people blindly buying, regardless of the consequences to the market or themselves. Just because it's popular doesn't mean it's good for anyone.

Hasn't failed them yet!
They also bought out exclusivity on the NFL license for an entire decade an counting. There's no alternative or competition.
 

darkside31337

Tomodachi wa Mahou
#33
I wonder how much MS is paying for that exclusive UT content. Because considering how big UT has gotten (and is still getting) it'd have to be a pretty decent amount of cash.
 
#34
They also bought out exclusivity on the NFL license for an entire decade an counting. There's no alternative or competition.
And yet the fans have yet to punish any of the guilty parties in this. The NFL, the NCAA and the heads of EA sports rake in billions every year and laugh at the outrage when year after year consumer patterns fail to change.