Electronic Arts to focus on freemium gaming
Electronic Arts will shift its business away from premium mobile game sales to focus on the freemium model, calling free-to-play titles "the norm" moving forward.
"We started to see that freemium was coming in, and it took us a long time to move over," Electronic Arts Senior Vice President and Group General Manager Nick Earl said in an interview with All Things D. "In all candor, we are behind."
Earl said the company's EA Mobile unit will begin the transition from premium to freemium this summer with the release of a new Simpsons title. The game will be free to download, generating revenue via sales of in-app virtual goods and content. "There will be a few one-time download games in the future, but they are the exception, and the norm will be freemium games," Earl said.
Earl added that Electronic Arts has been slow to embrace the freemium model in part because the business is so different from one-time premium downloads. He said freemium games are essentially a live service which must support a host of transactions as well as thousands of daily active users. As a result, EA Mobile will now devote more of its resources to supporting individual titles and will also ship fewer games in the future.
EA Mobile's first freemium title, The Sims FreePlay, launched across Apple's (NASDAQ:AAPL) iOS platform in December and eventually topped the App Store's countdown of the top-grossing iPad apps. The Sims FreePlay expanded to Google's (NASDAQ:GOOG) Android mobile operating system earlier this year.
Sales of in-game items will surge from $2.1 billion in 2011 to $4.8 billion in 2016, driven by a sharp increase in smartphone adoption and growing user comfort with the freemium revenue model, according to a recent forecast issued by Juniper Research.
- read this All Things D article
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