EA's Not Getting Rich Off Online Pass

[Andy Chalk]

EA's Not Getting Rich Off Online Pass

Electronic Arts says its Online Pass program hasn't resulted in a "dramatic" spike in revenues, bringing in only about $10 to $15 million since it went live.

If you're somehow still in the dark about EA Sports' Online Pass [http://www.escapistmagazine.com/news/view/100582-EA-Sports-Unveils-Launch-Day-DLC-Program-Online-Pass], it works like this: brand-new copies of videogames come with single-use codes that enable access to "online services, features and bonus content," forcing people who buy preowned copies to either pay extra for the same content or do without. The idea is to recover some of the revenues EA loses to preowned game sales, but according to CFO Eric Brown, it hasn't resulted in a huge windfall for the publisher.

"The revenues we derive from [Online Pass] haven't been dramatic. I'd say they're in the $10 to $15 million range," he said at the Citi 2011 Tech Conference last week. On the upside, he noted that it's all "found revenue," which is to say that it's effectively pure profit coming in for services EA is already providing.

I'd love to be in a position in which 15 million smackers is a trifling amount of money, but it's a fair description of the sum for EA. The company's net revenues for the first three months of its 2012 fiscal year - three months, mind - were $999 million. That's a billion bucks, kids. Every little bit helps but compared to that, $15 million is what you find under the couch cushions.

Source: Gamasutra [http://www.gamasutra.com/view/news/37089/EA_Details_Strong_Digital_Growth_Sims_Social_Numbers.php]


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[Something Amyss]

Is anybody really surprised? It seemed like a dumb idea in the first place, so what did they expect?

Oh, right, it's EA. They probably expected a 500 million dollar gain out of this.

It doesn't matter. In a week, they'll blame it on piracy (somehow).

 

[UnderCoverGuest]

Yay. EA made a stupid marketing decision. Whoo hoo. Dorks.

 

[Deathfish15]

Yay. EA made a stupid marketing decision. Whoo hoo. Dorks.

How is it a stupid marketing decision? They've made in 10-15million in pure profits off of the idea of limiting things for pre-owned. They're finally dipping into Gamestop's take away from their sales and trying to recoup their loses. It's a great thing, and it's just starting out. Similar to Digital Distribution, which was a small thing at first which took time to boom to what it is now.

 

[DTWolfwood]

hmm so 1,500,000 ppl willingly forked over money for this? now thats shocking.

 

[b3nn3tt]

To be fair, I think that sounds like a lot considering that it only costs $10 per game. And also considering that all of that is pure profit, with EA having to do no extra work.

I'd be interested to know whether there has also been an increase in buying games new. Because people may actually be more inclined to do that now, rather than pay the fee, and obviously that would also mean more money for EA.

 

[Epona]

Yay. EA made a stupid marketing decision. Whoo hoo. Dorks.

How is it a stupid marketing decision? They've made in 10-15million in pure profits off of the idea of limiting things for pre-owned. They're finally dipping into Gamestop's take away from their sales and trying to recoup their loses. It's a great thing, and it's just starting out. Similar to Digital Distribution, which was a small thing at first which took time to boom to what it is now.

Most of that comes out of the conusmers pocket, not Gamestops.

 

[yuval152]

"only 12m" I'm i the only that is seeing something wrong?

 

[Bobic]

Wow, so that makes the online pass really annoying and pointless. At least before it seemed like they were being unfair money grabbing fools for a reason. If someones going to try and rip us off they could at least make something of it, otherwise what was the point?

 

[Epona]

Wow, so that makes the online pass really annoying and pointless. At least before it seemed like they were being unfair money grabbing fools for a reason. If someones going to try and rip us off they could at least make something of it, otherwise what was the point?

To discourage you from buying used.

 

[BgRdMchne]

Not that I like EA after what they have done to Westwood and Bioware...

Don't forget what they did to Origin Systems. It's like if Activision made a digital distribution platform called Infocom.

 

[vivster]

it was never meant to make them richer
its sole point is covering server costs
and those millions are a start

 

[Something Amyss]

Most of that comes out of the conusmers pocket, not Gamestops.

Which is why all the "I like this because it screws gamestop" is so funny. It really screws the consumer.

 

[Something Amyss]

it was never meant to make them richer

The intent was to get a slice of the used game pie. They thought they were going to get more. They didn't. Don't make excuses for them

 

[GeorgW]

Now, let's analyse this.
This means that either they've been completely successful and don't realise it, by that I mean that more people have simply started buying their games new and therefore don't need the project $10. Or, which I find much more likely, most of the content the pass unlocks isn't worth $10.

 

[Croaker42]

Now, let's analyse this.
This means that either they've been completely successful and don't realise it, by that I mean that more people have simply started buying their games new and therefore don't need the project $10. Or, which I find much more likely, most of the content the pass unlocks isn't worth $10.

/This

Now I would like to see the cost of implementing this online pass. Its not all found revenue and seeing the real data behind this would make me happy.

 

[GeorgW]

Now, let's analyse this.
This means that either they've been completely successful and don't realise it, by that I mean that more people have simply started buying their games new and therefore don't need the project $10. Or, which I find much more likely, most of the content the pass unlocks isn't worth $10.

/This

Now I would like to see the cost of implementing this online pass. Its not all found revenue and seeing the real data behind this would make me happy.

Actually, printing and distributing codes, plus generating and verifying them isn't much of a cost.