Electronic Arts 2006 Annual Report Download - page 78

likenesses of actors, athletes and/or commentators (protected by personal publicity rights) and often
contain musical compositions and performances that are also copyrighted. Our products also may contain
content licensed from others, such as trademarks, Ñctional characters, storylines and software code.
We acquire the rights to include these kinds of intellectual property in our products through our own
development, acquisitions, and license agreements such as those with sports leagues and player
associations, movie studios and performing talent, music labels, music publishers and musicians. These
licenses are typically limited to use of the licensed rights in products for speciÑc time periods. In addition,
our products that play on consoles such as the Sony PlayStation 2 and some mobile platforms include
technology that is owned by the console manufacturer (for example, Sony) and licensed non-exclusively to
us for use. While we may have renewal rights for some licenses, our business and the justiÑcation for the
development of many of our products is dependent on our ability to continue to obtain the intellectual
property rights from the owners of these rights at reasonable rates.
Our products are susceptible to unauthorized copying. We typically distribute our PC products using copy
protection technology that we license from other companies. In addition, console manufacturers, such as
Sony, typically incorporate security devices in their consoles in an eÅort to prevent the use of unlicensed
products. Our primary protection against unauthorized use, duplication and distribution of our products is
enforcement of our copyright and trademark interests. We typically own the copyright to the software code
as well as the brand or title name trademark under which our products are marketed. We register our
copyrights in the United States and other countries.
Market Segment
Historically, there have been multiple consoles and mobile video game players available to consumers that
play interactive software games like ours, and there has been vigorous competition between manufacturers.
While Sony's PlayStation» and PlayStation 2 consoles have signiÑcantly outsold their competitors in the
past, Microsoft and Nintendo are large and viable competitors, and PCs continue to be a strong interactive
game platform. Similarly, while Nintendo's Game Boy, Game Boy Color and Game Boy Advance have
been the historic leaders in the mobile video game player market, Sony's PlayStation Portable is a recent
successful competitor in this segment. We develop and publish products for multiple platforms, and this
diversiÑcation continues to be a cornerstone of our product strategy.
We currently develop or publish products for 12 diÅerent hardware platforms. In Ñscal 2006, we released
games designed to play on the PlayStation 2, Xbox, Xbox 360, Nintendo GameCube, PC, Game Boy
Advance, Sony PSP, Nintendo DS, online and cellular handsets. In Ñscal 2007, we plan to release games
designed for play on these platforms as well as games designed for play on the PlayStation 3 and Nintendo
Wii
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