EA in the hunt for a piece of the mobile game market
In early March, one of the world’s most famous cartoon characters, Homer Simpson, met one of the world’s largest gaming companies, Electronic Arts (NASDAQ: EA), on a whole new platform: mobile.
The game’s Internet teaser follows Homer Simpson as he scurries around Springfield, narrowly avoiding the buildings being dropped around him. A giant yellow finger pushes the screen forward to reveal another Homer controlling the action on an iPad. When asked why he’s doing it, Homer responds with the familiar line, “Because I can get free donuts!”
The Simpsons: Tapped Out was a new adaptation of EA’s familiar SimCity model — its most popular building/management game, ever. In The Simpsons game, the player can construct a new city based on Fox’s popular animated series. But the exceeding popularity of both SimCity and the Simpsons led the game’s server to crash, and EA pulled the game from the Apple App Store just days after this month’s release. EA announced that it plans to reinstate the game once the bugs have been fixed, but offered no timeline.
The push to make content available across multiple platforms is increasing steadily as gaming companies vie for access to the near 500 million currently active iOS and Android devices in the marketplace. EA, a company most recognized for its success in console-based video games, is attempting to bring more of these popular titles to the digital realm, making them more competitive with social game developers such as Zynga, and other independent groups.
CEO John Riccitiello estimated that 60 percent of EA’s business is digital in “some form.” However, he also noted during a slideshow presentation given at the Wedbush Securities Technology Media and Telecommunications Conference on March 8 that “growth in digital and HD is masked by decline in standard definition consoles.” This means that as consumers move away from their XBoxes and Wiis and to their social networks, the loss from that revenue is masking EA’s success with its mobile platforms.
Popular sports titles such as FIFA 12 and NBA Jam were released for the Android just last month. And shortly following Apple’s announcement of its new iPad, EA said it had plans to “optimize” its games for the newer model. EA announced on March 16 that three of its games were readily compatible with the new iPad’s retina display, and that previous subscribers could upgrade for free.
Frank Gibeau, president of EA’s Labels, said that the company is also closely examining the iPad’s potential in the digital sphere, signaling another move away from consoles.
“When the iPad gets to the processing power that’s equal to an Xbox 360 and it connects to a television, that’s no big deal to us. We’ll put the game through the iPad and have it display through the television,” Gibeau said in an interview with Reuters.
“The most conservative estimates suggest that there’s about a billion people in the gaming industry or gamers and probably getting close to two billion by the end of this year,” Ricciteillo said during the Q&A portion of the conference. “New users are coming in, driven by frankly, access. Got an iPhone? You’re probably a gamer. Got a Facebook account? You’re probably a gamer. And what that does, it brings new people in, if you will, new blood, new revenue, new growth.”
Flurry Analytics, a mobile applications tracker, estimates that 52 percent of time spent on smartphone devices is used to play games. Twenty-two percent is dedicated to social networking.
Samantha Woodward, a Stanford computer science student, said she has four games on her iPhone, which she spends up to half an hour per day playing. She noted, however, that this was during periods of waiting, or when taking a break from work.
“I used to play console-based games a lot, especially during my first few years of college,” Woodward said. “But now that I’m more busy, I just download games to my phone and can take them with me to fill time during the day.”
EA currently offers 140 mobile games — depending on cell service provider — with titles ranging from the familiar Sims franchise to American Idol to Tetris. But Flurry’s Vice President of Marketing Peter Farago notes in a blog post that “indie” game developers are still dominating the mobile marketplace.
“Even when traditional, established game companies have attempted to buy a stronger position on iOS and Android through acquisition, the reduced importance of brand power in mobile app gaming allows indie developers to continue to innovate and capture increasing consumer mind share,” Farago wrote.
Currently, only one EA title is ranked in the top 10 of Apple’s paid games, though EA acquired Chillingo, the maker of “Cut the Rope,” is currently ranked sixth.