Revenue From EA's DLC Outstrips Physical Sales
Written Thursday, September 16, 2010 By Richard WalkerView author's profile
"We think that used games in America at this point are perhaps 20 per cent of overall business," declared EA's chief financial officer, Eric Brown during a technology conference in San Francisco on Tuesday. As such, the company's $10 initiative has become a vital component in generating revenue lost by used game sales and surprisingly, EA's downloadable content sales have grown to outweigh the profit created by physical game sales.
Alluding to EA's Project $10, Brown stated that, "The price is $10, which seems to be gaining user acceptance – the acquisitions, the take rates are quite high, well north of 60 per cent on the titles we've seen so far.
"There hasn't been any significant push-back from the consumer, because I think people realise that if you're buying a physical disc and it requires an attachment to someone else's network and servers, people know bandwidth isn't free."
Brown also noted that the initiative hasn't fallen victim to consumer backlash, before going on to say that sales of DLC earned EA far more profit than Project $10, with FIFA cited as one of the most successful examples, with add-ons like Ultimate Team raking in big bucks.
"FIFA 10 generated just over $30m in gross DLC sales – so that'd be above and beyond the revenue that we made just selling the physical disc," said Brown, adding, "Instead of selling one product with a unified $60 price point we see people buying a $60 disc and then bolting on hundreds of dollars of DLC. We're happy to have $500 worth of extra content to sell."
Don't be surprised if EA ramps up its volume of DLC in the future then, with more add-ons for its sports titles a certainty. Are you happy to buy $500 worth of content though?