Electronic Arts 2014 Annual Report Download - page 74

Publish on Multiple Platforms
Our ability to deliver our products and services across multiple platforms has been, and will continue to be,
another cornerstone of our business strategy. We believe the ability to successfully publish across multiple
platforms is critical to maintaining and growing our overall consumer base, which continues to evolve in
response to the introduction of new platforms and platform business models.
•New Consoles. We are highly focused on developing games and services for Xbox One and PlayStation
4, which were each released in November 2013. The rates at which consumers purchase these new
consoles and our ability to release commercially successful products on them will be critical to our
success.
•Legacy Consoles. Though industry sales of major games for Xbox 360 and PlayStation 3 declined
significantly during our 2014 fiscal year, these legacy platforms maintain a sizeable user base and we
expect to continue to develop and market products for each of them in the near term.
•Mobile. We develop and publish games for mobile phones and tablets (“mobile games”). The market
for mobile games addresses a significantly wider demographic than that of games traditionally played
on consoles and PCs, has low barriers to entry and is crowded with thousands of product offerings. We
believe the consumer recognition associated with our wholly-owned and licensed brands helps to
differentiate our offerings in order to acquire customers in this crowded market. In addition, our free-
to-play, micro-transaction mobile game offerings allow consumers to try and play our games with no
up-front cost, reducing a major barrier to initial customer acquisition.
•PC Free-to-Play. We publish, directly and through publishing partners, free-to-play, micro-transaction-
based games that can be played on PCs directly over the Internet such as FIFA Online. The mass
introduction and wide consumer acceptance of free-to-play, micro-transaction-based PC games has
created a large addressable market.
•PC & Origin. We digitally distribute PC downloadable games directly to consumers via our online
Origin portal. The Origin portal, as well as the Origin client application integrated into our PC games,
provide opportunities to acquire and maintain direct on-going relationships with consumers.
New online-enabled gaming platforms, such as “micro-consoles” offered in entertainment set-top boxes, have
emerged and are expected to continue to emerge in the future. We intend to evaluate new platform publishing
opportunities on a case-by-case basis as they emerge.
Digital Revenue Growth
We are investing in strategies and capabilities that will allow us to enhance our digitally delivered and online-
enabled product and service offerings. Historically, our revenue came mainly from selling disc-based video game
products through retailers (we call these “packaged goods” products). Now, we also derive significant and
increasing revenue from the delivery of games, additional content and services through online and wireless
networks, which we refer to as “digital revenue.” For example:
• Consumers can purchase and download our PC games (and those of other publishers) directly through
our Origin online platform, as well as through third-party online download stores and services;
• Consumers can purchase and acquire digitally-delivered console games, additional content and
enhanced online services directly through Sony’s PlayStation Network and Microsoft’s Xbox LIVE
Marketplace;
• Our mobile and PC free-to-play games, which are monetized through discrete digital micro-
transactions, are available only through wireless and online delivery; and
• We offer large-scale, massively multi-player online games and game services on a free-to-play and
subscription basis.
We believe that digital revenue, which is frequently higher-margin relative to packaged goods sales revenue, will
continue to increase in relative and absolute terms.
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