EA Sports president Peter Moore used his MI6 Keynote to issue a warning to companies operating in the Facebook and social gaming market: Electronic Arts will only be satisfied with market leadership.
"There's a big dog in front of us," he said, referring to social gaming leader Zynga. "But we aren't far behind, and we're confident that we can catch up. What we can bring to the market in terms of blue chip IP is phenomenal."
The theme of Moore's speech was the growth of digital gaming, and he shared EA estimates showing digital gaming rising from 31 percent of the market in 2008 to 45 percent in 2010. While the packaged games market has grown from $39.9 billion to $44.2 billion in that time, by EA estimates, the digital games market has grown much faster, from $12.4 billion to $19.9 billion.
"We are seeing growth of between five and ten percent every year," Moore said. "The size of our market has gone from 250 million people who call themselves gamers to 1.2 billion people. Digital is the driver of that growth."
He said companies that refuse to keep up with changes in consumer behavior are bound to fail, claiming that "no company had spent more investing in the future than Electronic Arts."
"Our competitors scoffed when we invested in social gaming, by buying Playfish. They scoffed at our direct-to-consumer models. But we are number one in mobile games, number one in casual games and number two in social games."
Moore also talked about how EA games, especially EA Sports games, make use of social networks and multiple devices to create a persistent experience with the brand. He pointed out that engagement with the company's biggest brand, FIFA, is up 66 percent year-on-year as the brand has been launched on social platforms and new social features have been added to traditional console versions of the game.
He added that companies shouldn't be worried about disruptions to traditional business models. "Yes, there is a nervousness about change. People want to know how they can keep getting $60 for games while social and online games are free or when iPad games are a fraction of the cost. But change is good. Change brings more consumers into gaming. Consumers are driving the changes and, in the end, they always win."
Gaming vs. Tech kiddie video http://www.youtube.com/watch?v=FRbcV1e4k7A ERTS; Digital Distribution channels will dominate all future game revenue. Pretty package games = 8 trak player.
ERTS may lose its market dominance as distribution channels like Steam( http://store.steampowered.com/ ) will have direct access to end users(POS). ~in short.
I smell shareholder disappointment.
ERTS may lose its market dominance as distribution channels like Steam( http://store.steampowered.com/ ) will have direct access to end users(POS). ~in short.