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Electronic Arts, one of the world's largest publishers of video games, said that the company will inevitably become 100% digital, e.g. will sell and ship titles via the Internet and/or will stream games using cloud services like Gaikai or OnLive. Nonetheless, the head of Electronics Arts is sure that packaged media will not extinct for a number of years.

Back in the days EA published games for two, three or four platforms on several well-developed markets. Nowadays the number of platforms used to  play games increased dramatically and new markets that are growing rapidly emerged. As a result, it is not only hard to ensure retail availability of all titles on all markets for different platforms, but in many cases it is inefficient way of making business. Moreover, thanks to digital distribution via the Internet, Electronic Arts can easily sell additional content, capitalize on other forms of in-app purchases or offer certain services it cannot provide in general. Still, there will be game boxes in the retail as well.

"If customers want to buy a game at retail, they can do that too. We will continue to deliver games in whatever media formats make sense and as one ebbs and one starts to flow, we'll go in that direction. For us, the fastest growing segment of our business is clearly digital and clearly digital services and ultimately Electronic Arts, at some point in the future we are going to be a 100% digital company, period. It is going to be there someday. It is inevitable," said Frank Gibeau, the president of EA Labers, in an interview with GamesIndustry web-site.

At present EA still gets most of its revenues from selling titles in retail, but the day when the company will get the lion's share, or even all, of its earnings from digital products is near.

"We have a clear line of sight on it and we're excited about it. Retail is a great channel for us. We have great relationships with our partners there. At the same time, the ultimate relationship is the connection that we have with the gamer. If the gamer wants to get the game through a digital download and that is the best way for them to get it, that is what we are going to do. It has a lot of enhancements for our business. It allows us to keep more that we make. It allows us to do some really interesting things from a service level standpoint; we can be a lot more personalized with what we're doing," added Mr. Gibeau.

The head of EA Labels also believes strongly in various cloud and streaming services that bring titles to all platforms at once now matter how powerful one or another device is. There will be at least one more generation of video game consoles from Microsoft, Nintendo and Sony Computer Entertainment that will bring numerous innovations; but the game streaming cloud services will clearly become big in the coming years and therefore EA is preparing for the era of cloud titles.

"The advent of IP televisions and streaming - we will be prepared for it. That will be a way that we will generate content and deliver it to customers in a high quality way. The next generation of hardware is going to come out. It is difficult to speculate what generation next would be after that, but there are opportunities in cloud and streaming that are very interesting to us and we have relationships with Gaikai and other companies where we have investigated a lot of that stuff and we clearly see our IP and our capabilities on the digital services front translating over very easily there. [...] If cloud and streaming come on line at scale, we will be in the position to do it and we're excited about it," stated Mr. Gibeau.

Tags: Electronic Arts, Microsoft, Sony, Nintendo, Wii U, Wii, Playstation, Xbox, Windows, Gaikai, OnLive

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Comments currently: 3
Discussion started: 07/04/12 02:27:58 PM
Latest comment: 07/05/12 09:42:12 AM
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1. 
Books!!!

Books, books, books!!!

What else is their to say?
Retail and or tangible product purchases will never ever disappear.
To ignore the retail space is and has always been sheer stupidity.
0 0 [Posted by: Garrison01  | Date: 07/04/12 02:27:58 PM]
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CDs!!!
CDs, Cds, CDs!!!
They haven't disappeared completely because some old people still don't have computers and smart phones. Video games aren't generally played by that demographic. For a long time the music industry ignored innovation and it nearly killed it! Unlike books (which I agree will not disappear), Video games are 100% digital and will completely abandon physical packages bought in stores. "Waiting in line at GameStop" is fast becoming a sort "back in the day..." story I will tell my kids. I give discs maybe 2 more years.
0 0 [Posted by: zukkazukkawhoo  | Date: 07/04/12 10:49:42 PM]
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CDs and other physical sales will stay existing until the internet download limit , stability and bandwidth is large enough. because mos games are 6 Gb in size and larger so it takes hours to download it.
0 0 [Posted by: massau  | Date: 07/05/12 09:42:12 AM]
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