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Article on EA's "monopoly" of the gaming industry [message #68225] Mon, 23 February 2004 01:29 Go to previous message
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http://www.gamemethod.com/archive/366.php

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Electronic Arts and the Growing Trends of the Gaming Industry

Anyone who plays videogames these days has probably played at least one game produced by Electronic Arts(EA). Brands like Madden, Medal of Honor, The Sims, and big name licenses like Lord of the Rings make up EA’s library. EA is one of the top sellers of entertainment software for 2003, posting revenues of $2.5 billion dollars for this past year. With strong franchises, a lot of money in pocket, and products on many different mediums, EA seems to have a bright future ahead of them as a corporation. However, does EA’s bright future translate into a bright future for the gaming public? Is EA’s continued success good for the industry as a whole, or does their growth present a threat to the advancement of games as a whole?

A brief history of EA shows an astounding pedigree. Founded in 1982, EA published many developers’ games and developed a quite a few in-house games as well. Perhaps the first critically acclaimed EA game was Archon, a top down, chess like strategy game. Other classics included The Seven Cities of Gold, where you explored the New World as Christopher Columbus, Skate or Die, the popular skateboarding game for the NES, and Populous, the original ‘god game’, created by the now famous Peter Molyneux and his development team at Bullfrog. In 1988, the famous Madden series was born on the Apple II, and it was quickly ported to the Sega Genesis in 1990, thus beginning the long series of Madden games to come.

In the 1990s, Electronic Arts had continued success with its publishing, licensing, and various acquisitions. In 1992, EA acquired Origin Systems Inc., thus securing the famous Ultima and Wing Commander licenses. Syndicate, another Molyneux classic, was published in 1993. EA Sports was formed in 1991 to develop several other licensed sports games like Madden, including NHL Hockey and FIFA. In 1994 Bullfrog struck again with Theme Park, and Looking Glass Studios' System Shock was released to incredible acclaim. In 1995, the first Need For Speed was released, and Bullfrog fully merged with EA. In 1997, EA released Ultima Online, one of the first persistent online worlds. Westwood Studios, the makers of the popular Command and Conquer series, was also acquired by EA in 1998 for $122.5 million dollars. In 1999, the first Metal of Honor game was released, followed by Sid Meier’s Alpha Centauri, the first in a long line of Sid Meier branded games. Electronic Arts was now a force to be reckoned with in the gaming industry, but nothing could prepare the world for what would come in the next millennium.

The smash hit The Sims took the PC gaming world by storm in the year 2000. In early 2002, EA reported that The Sims had sold more than 6.3 million copies, making it one of the best selling games of all time, and the Medal of Honor series, the SSX series, and the various sports series developed by EA Sports are all top sellers. Licensed games from franchises like The Lord of the Rings, Harry Potter, and James Bond also make large contributions to revenues.

It’s obvious from reading all of this that Electronic Arts has a firm foothold in the American gaming market. Sales figures for the year 2003 show that EA has no more than four games in the top ten best sellers list (see chart below), a trend that continues from years prior.



Rank Game Title Console Publisher Total sales
1 Madden Football ‘04 PS2 EA 2,400,000
2 Pokemon Ruby GBA Nintendo 1,500,000
3 Pokemon Sapphire GBA Nintendo 1,400,000
4 Zelda: The Wind Waker GCN Nintendo 1,300,000
5 Grand Theft Auto: Vice City PS2 Rockstar Games 1,100,000
6 Enter the Matrix PS2 Atari 1,000,000
7 The Getaway PS2 Sony 829,000
8 NCAA Football ‘04 PS2 EA 811,000
9 NBA Street Vol. 2 PS2 EA 790,000
10 The Sims PS2 EA 707,000

Best Selling Console Games from January – November ’03.





Electronic Arts is expanding their operations more and more, and with new franchises like NFL Street, updates to old series like Madden, and a sequel to The Sims in production, their financial success as a corporation looks brighter than ever. Many analysts have praised the company and have promoted their stock to investors. If these trends continue, it’s not out of the realm of possibility that EA will become the most dominant force in the American gaming market.

But why am I telling you all of this? Why should you be worried that EA rules the American gaming market and dominates sales? Well, if EA becomes too large of a force in the industry, it has some potentially damaging side effects that will hurt us, the consumers.

First and foremost, competition breeds creativity. If EA can knock out the competition, it could (potentially) create a lot of problems for the industry. The early console wars gave birth to many creative and original ideas that helped push the industry to its current status. For example, Nintendo’s superiority complex in the late 80s (due to the amazing success of the NES) allowed SEGA to launch its 16-bit Genesis system unimpeded. Nintendo was forced to catch up to SEGA in the early 90s by developing the SNES, and many console gamers remember this as a time of incredible innovation. As both companies were neck and neck, they were forced to push the boundaries of the industry, which greatly benefitted the consumer. Where there is competition, there is innovation, but if EA can keep selling the same football game every year with just a few small changes, how will games advance as a genre and art form?

With almost 600 million dollars in sales in 2003(not including December), and 20% of the entire market, Electronic Arts is a developing and publishing powerhouse. However, there’s a problem when EA has enough money to buy out any studios that bring out a hit game, and secure popular franchises like Command and Conquer or SimCity. A good example is their acquisition of DreamWorks Interactive (makers of Medal of Honor) in early 2000, and the subsequent exodus of the original Medal of Honor team two years later. One of those original team members, Scott Langteau, became the Chief Operating Officer for the newly formed Spark Unlimited development team, which is made up of those same members. Scott’s interview in the December 2003 issue of Game Informer give the impression that EA wasn’t allowing the team to spread its wings: “We wanted to create a place where the people who create game content have the best avenue by where they can get their amazing work into the game...In the past, it was difficult getting those things through the pipeline and into the game the way we wanted it. Now we can.” (qtd. in Game Informer, Dec 2003, pg. 36). It’s easy to see how the higher ups can stifle a development team’s creativity, and lately we’ve seen a lot of development teams leaving larger corporations to start their own companies, such as Sacnoth (a company made up of former SNK and Squaresoft employees). If EA keeps acquiring budding development studios, and conforming new games to the current market trend, it might result in a stifling of creativity in the industry as a whole. Why innovate when you can stick to the get-rich-quick formula?

As entertainment software slowly grows into a lucrative business, companies once made up of gamers first and foremost are slowly giving way to corporations whose eyes are primarily fixed on their bank accounts. This brings me to my next argument, which is that corporate executives don’t necessarily play games, but are instead primarily concerned about the bottom line. Every company that wants to stay in business needs to make money, however when execs are completely unfamiliar with the art of designing and developing a game, they tend to authorize less risks and more rehash. You could almost make an analogy between the gaming industry and Hollywood, in that major movie studios rarely put out truly experimental films and require most movies to follow a strict format. EA executives want to secure their company’s place in the industry (and possibly, their place in the company), resulting in more and more sequels that guarantee revenues, and less and less creative titles. Case in point: EA has released a total of six expansions for their flagship product, The Sims. These expansions retail at around $30, but typically contain very little enhancement of the original premise, instead adding new skins and objects to use in game (which I feel should be made available online instead). On top of this, the design flaws of the original game (such as awkward pathfinding) have never been addressed. Despite all of these facts, the expansion packs are top sellers. Why make something better when you don’t have to?

Although there are exceptions to the idea that big companies equal less innovative games (Capcom, Konami, Nintendo), the current economic trends (and the tendency for corporate execs to demand larger salaries) point towards a movement towards less chancy titles, which is why we’ve seen so many sequels lately.

Another example of corporate policy dictating game play is the changes made to Ultima Online in the year 2000. The rising success of Sony's EverQuest prompted EA to change UO in a way that would attract the same user base as EverQuest. Unfortunately, these changes eliminated much of the player vs player interaction that was a staple of UO, and cherished by many players. In the end, many of the older fans left Ultima Online as the ideas that made it groundbreaking were slowly phased out, only to be replaced by ideas that mirrored Everquest more "sugar-coated" game play.

Electronic Arts also funds their game development with tons of money. Anyone who’s seen videos on the making of Medal of Honor: Allied Assault, can see where the money went: the historical accuracy was terrific, the cinematic style of each stage was painstakingly created, and the musical score was awe-inspiring. However, look at the wave of sequels that Medal of Honor has spawned, all using the same graphics engine and containing the same all-to-familiar game play elements, which unfortunately, still sell many copies. The new Ultima, UXO, will likely be developed with the same moneymaking formula as all other popular MMOrpg’s, with less player interaction and shinier swords to swing around. EA will always go where the money is, and inventive developers with less money to throw around will either be bought out, or buried by EA’s marketing blitz.

If we as gamers want the industry to grow and be accepted by the mainstream as art, the boundaries of our medium must be expanded by companies that are passionate about games and what experiences they can deliver to the audiences that play them. With wealthy companies like EA caring more about the bottom line than creativity, the progress of games as a medium will continue, but at a snails pace in comparison to the previous years of fierce competition. It’s not the aim of this article to demonize Electronic Arts or good business sense, but rather, to make gamers aware of something that has been brewing for a long time. Will the continued success of EA hurt the gaming industry as a whole? Only time will tell.

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