According to Wedbush Securities analyst – Michael Pachter, the development costs of Star Wars: The Old Republic, could exceed $80 million, especially if you factor in all the marketing and distribution costs. “The contribution from the Star Wars MMO is significant. Under the terms of its deal with LucasArts, EA is required to pay a royalty, but was required to front all of the development, marketing and distribution costs, as well as the costs of building out servers for the game. We estimate that LucasArts’ share is 33% of revenues, AFTER EA recoups its investment in game development. Given that the game was in development for over four years, with an estimated 200 full-time developers working on it, we estimate that EA’s investment exceeds $80 million,” EA has mentioned that it doesn’t need a whole lot of subscribes to make all that profit back and by having about 500,000 subscribers…
business model
Electronic Arts Q4 Earnings Live Blog
Electronic Arts Q4 Earnings Live Blog. At 2:00PM PDT (5:00PM EDT) today, Electronics Arts gave their quarterly call for investors to report results. I joined the call as a member of the media and got the inside scoop on what’s happening with EA. There was a lot of great info in this call so I’m bringing you the highlights right here. First, they reaffirmed that Star Wars: The Old Republic will ship in CY 2011. Additionally: Star Wars: The Old Republic will be launched as a Digital Service. Subscription revenue expected to rise with the launch of SWTOR. SWTOR was mentioned as a Subscription based MMO Over 1 million testers (signed up) Server infrastructure for Star Wars: The Old Republic is a significant FY12 cost investment. There was also an interesting Q&A involving SWTOR: Question: On the beta test for SWTOR, how long can a test like that last before…
One million subscribers are attainable for SWTOR says analyst
What do you think? Will SW:TOR make one million subscribers or are they counting their chickens before they hatch? Personally, I think the 1 mill mark is very attainable but the real question is whether or not they will hold that many subscribers over time. How many MMOs have launched with high expectations and then fallen flat on their faces? (Think Warhammer and Age of Conan) I’m not expecting SW:TOR to join this list of overhyped MMOs but maybe I’m just holding high hopes as a big fan. We’ll have to wait until Fall to know for certain. While there is no definitive release date of the game, it is announced that it will be complete and ready for launch later this year. (We hope!) At the Electronic Arts fourth-quarter shareholders’ conference earlier this year, CEO John Riccitiello stated this about his soon-to-be-released MMORPG Star Wars: The Old Republic: “At…
Paid to Play SWTOR?
Would you love to get paid to play SWTOR? Who wouldn’t, right? Steven Reid, the Senior Community Manager from BioWare tweeted some news you’re gonna get excited about. If you live in or near Austin, Texas (me, me!) and have an interest in working in QA at BioWare on Star Wars: The Old Republic, here’s some news you’ll definitely be interested in. Make plans to head on over to Austin Books this upcoming Saturday and you may just get your chance. In fact, it may be the big break you’ve been waiting for to get into the gaming industry and what better video game to do it with than SWTOR? This Saturday is a very special day for gamers wanting to make their presence known within the gaming industry because Austin Books tweeted some information all gamers will be interested in. They will be holding a special Star Wars Day…
Selling Currency to a Game Not Yet Released?
Apparently you can buy SWTOR credits now, even though the game has not yet released. For gamers who partake in gold/currency-buying, this might be good news. For others, it’s an early sign of the annoying “gold-spammers” might cause in the increasingly popular game. Companies selling Star Wars: The Old Republic currency for real-world money are already on the Net and bartering their goods, months before the expected release of the game. Popular gold seller IGXE (Internet Game Exchange) recently released a press release about their placeholder pricing on SWTOR credits at £650 for 1000 credits. A simple search online will show you many other companies getting in the SWTOR action with promises of credit/gold to players. Just a few examples of the existing domains hawking non-existent credits include: starwarscredit.com, swtorforsale.com, swtorsell.com, swtorgolds.com, swtorgold.net, cheapswtorcredit.com, buyoldrepubliccredits.net, and cheap-swtor-credits.org. The closer it gets to launch time for the game, the more we…
1.5 million interested in Star Wars: The Old Republic beta
As we reported yesterday Chief financial officer Eric Brown reviled that around 1.5 million gamers have registered their interest in being part of a Star Wars: The Old Republic beta. … We’ve got well north of a million, million and a half ready to test for free,” he said of Star Wars the Old Republic beta. “We’re not that concerned about generating initial demand. For us it’s about creating the right experience, expanded beyond the tier one and the tier two users. You’ve got people that have never played an MMO before but are interested in Star Wars, to engage and give it a try. What’s really important to us is striking the right balance so that we serve the needs and demands, requirements of the core, pre-existing MMO subscribers. “They demand a lot of content, a lot of community, guilds are very important, special group activities, raids and things…
SWTOR will not launch before July 1, says EA
During today’s Lazard Capital Markets Technology and Media Conference, EA CFO Eric Brown said that the firm would not release Star Wars: The Old Republic during the firm’s FY11. At the same time, he reconfirmed that it will be released sometime during calender 2011. “So we said it’s going to launch sometime in calendar, but not within Fiscal 11. So that basically pens down between you know, April 1st and December 31st of this calendar year. It’s also reasonable to infer that it’s not in our Q1 guidance. We gave Q1 Fiscal 11, Fiscal 12 non gap revenue guidance, minus 39 minus 44 cents and I think it’s not unreasonable to infer that it’s not included in that 90 day period.” So it looks like March-June is likely out, leaving a release date of July 1 at the earliest. Personally I belive it will be out some time this fall….
The BioWare Method
At Last weeks DICE Summit, the BioWare Co-Founders Greg Zeschuk and Ray Muzyka gave a presentation to attendees entitled “The BioWare Method.” In this the doctors explained how it has been a long road to get to where BioWare is today, and share some of the knowledge they have learned through out the years in business. The most important lesson in releasing a successful game is recruiting and maintaining a strong team, and BioWare’s co-founders, Dr. Greg Zeschuk and Dr. Ray Muzyka, explain how it’s done. They alsoencourage long-term and forward thinking, always play games to continue learning, and maintain a positive team culture. One of the biggest components of keeping together a strong team is communication and honesty. Dr. Zeschuk and Dr. Muzyka admitted that Mass Effect 1 DLC didn’t go quite as well as expected, so going forward the Dragon Age and Mass Effect teams worked together to…
EA: Star Wars: The Old Republic “going right at” World of Warcraft
In a presentation at an investment conference Tuesday afternoon, EA chief executive John Riccitiello noted some of the company’s up-coming releases for the year that he expects will boost the company’s share in two key areas of the video game market–first-person shooters and massive multi-player online, or MMO, games. EA has high hopes for Star Wars: The old republic expecting the game to come out sometime late in the calendar year 2011. Riccitiello compared the Star Wars: The old republic to “World of Warcraft,” the most successful MMO game in the market that is produced by Activision’s Blizzard unit. He praised “Warcraft” as one of the “greatest entertainment properties ever built,” but believes the “Star Wars” universe could topple it. “We want to take share,” he said of the MMO category. He added that SWTOR is being built on an improved technology platform that is going to look better than…
HeroEngine Owner Idea Fabrik Founds New US Dev Studio
Last year HeroEngine (which is being used to build Star Wars: The Old Republic) was bought from Simutronics by Idea Fabrik in Germany. Last week the Germans announced the creation of a new game development studio in Northern Virginia: Second Star Interactive. Headed by game industry veteran Darrin Hyrup, Second Star Interactive features a core team with decades of experience at major studios throughout the game industry, including Electronic Arts, Mythic, Bethesda Softworks and Sony Online Entertainment. “Developing our own games is a critical part of our efforts to expand and enhance our technology because it keeps us close to the HeroEngine user experience,” said Neil Harris, President of the U.S. operations and COO of Idea Fabrik. “Darrin and the Second Star team bring a wealth of experience and practical contributions to the table that will help us grow both as a technology provider and as a company.” Second Star…
Insiders are Selling EA Shares
This properly doesn’t meen anything for Star Wars: The old republic, but if you are an invester like me, monitoring insider trades is a very important component to successful investing. We think you should be aware of these insider sales from the first week of February: Kenneth A Barker, SVP & Chief Accounting Officer, sold $99,704 worth of stock on February 3rd, 2011 Stephen G. Bene, SVP & General Counsel, sold $707,087 worth of stock on February 3rd, 2011 Peter Moore, President, EA Sports Label, sold $264,152 worth of stock on February 3rd, 2011 and Gabrielle B. Toledano, EVP, HR, Corporate Services, sold $89,408 worth of stock on February 3rd, 2011. Shares of (NASDAQ:ERTS) have increased by 10.26% year-to-date.
EA To Present At Goldman Sachs Technology And Internet Conference
At last weeks conference call, we learned that Star Wars: The old republic needs 500.000 subscribers to be profitable. Apart from that, only small amount of new information came out. Now we get a new chance to gather information about the game, as John Riccitiello, Chief Executive Officer of Electronic Arts will present at the Goldman Sachs Technology and Internet Conference on Tuesday, February 15, 2011 in San Francisco. Here is the press release I found in my mail box this morning: Electronic Arts Inc. today announced that John Riccitiello, Chief Executive Officer, will present at the Goldman Sachs Technology and Internet Conference on Tuesday, February 15, 2011 in San Francisco, CA. During the course of this event, Electronic Arts may disclose material developments affecting its business and/or financial performance. Listeners may access the presentation via a live audio webcast. Tuesday, February 15, 2010Presentation at 2:40 PM PT / 5:40…
George Lucas Still Makes a Lot of Money Off ‘Star Wars’ Toys
In 2010, Lucasfilm broke its record for the most revenue gained from toy sales in a year without a Star Wars theatrical release, raking in $510 million dollars worth of action figures, space ships, and other assorted hunks of plastic. The Hollywood Reporter points out that, though there were no Star Wars films in theaters, the popularity of the Cartoon Network’s Star Wars: Clone Wars maintained a certain pop cultural profile for the franchise. Keep in mind that this is purely toy sales, and does not include the myriad of other merchandise from a galaxy far, far away. When George Lucas negotiated his contract to write and direct the first Star Wars film, he insisted on maintaining the merchandising rights, including toys, and 20th Century Fox readily agreed. At the time, studios didn’t view toy tie-ins as a meaningful enterprise. Lucas corrected their thinking, and you’ll notice that almost every…
EA: Star Wars: Old Republic can be profitable with 500000 subs
World of Warcraft may have more than 12 million subscribers, but that doesn’t mean Star Wars: The Old Republic needs to surpass or even approach those sorts of numbers in order to be profitable. During a conference call yesterday EA CFO Scott Brown talked about the number of subscribers BioWare’s upcoming MMO Star Wars: The Old Republic need to be profitable – and according to his comments on a recent conference call: it’s 500,000. “”At half a million subscribers, the game is substantially profitable, but it’s not the kind of thing we would write home about,” he said. “”Anything north of a million subscribers, it’s a very profitable business.”” Tackling World of Warcraft is certainly a daunting task. Achieving one million subscribers, though? That’s not in any way a given, but it’s most definitely an achievable number for a quality MMO — especially one carrying the Star Wars name. Brown…
SWTOR – The risky investment by EA
World of Warcraft is, without reason of doubt, one of the best successes on the market that, even though it has aged and should have been dead already (in theory only – because game rarely “live” more that 2 years). But WoW is still the leader, the moneymaker, the game that drives so many people crazy – destroys marriages, makes people rich and so on. And it keeps going. A hit MMO like that can be an huge thing for the investors on Wall Street. If a MMORPG has success, it can offer a certain degree of predictable revenue. For example, there’s a certain degree to which World of Warcraft subscription revenues are a sure thing each quarter for Activision Blizzard. Electronic Arts and BioWare are well aware of the stats, and they’re making sure their entrant in the genre is well prepared: EA is spending more money on the…
WoW Killer or WoW Failure?
Is there room for 2 incredibly powerful MMO’s on the market, can Star Wars: The old republic out shine World of Warcraft where every other MMO has failed to be #1? Maybe… It might be too late though, with WoW already being as big as it is. But we’ve seen game play after game play in anticipation for Sw:Tor to shine brightly in our hands making us the rulers of our own destiny with a lightsaber or Two. If Tor cannot succeed in drawing you in as promised with it’s epic story telling than we might see millions of dollars and hours just thrown away, but I’ve always had faith in the Bioware franchise ever since Balder’s Gate pretty much the only thing I do have faith in. “So where does that leave EA and BioWare Austin? Possibly up a creek given how much money has reportedly been poured into…
EA: Old Republic will have ten-year lifespan
Speaking at the UBS Annual Media and Communications Conference in New York, EA CFO Eric Brown confirmed that SWTOR will use the monthly subscription business model. He also predicted a ten-year lifespan for the game: “Our assumptions for break-even and profitability are not seven-digit subscribers. We think we can run and operate a very successful and profitable MMO at different levels… The key thing here is to really perfect the product. We’re shooting for an extremely high quality game experience. We view this as a ten-year opportunity.” It was also mentioned that SWTOR “…will generate revenue through monthly subscriptions” With such a highly anticipated title on their hands, it is very surprising to hear EA more or less undercut their projections. Obviously not wanting to fail under the feet of the World of Warcraft juggernaut, the publisher thought it better to keep their sales projections reasonable and instead hope the…
Gamespot interview with Dr. Ray Muzyka
Gamespot had the chance to do an interview with BioWare’s Ray Muzyka at this years EA Winter Showcase. The interview is mostly about how the game is shaping up, but there is an interesting part about the recent announcement on EA being named the sole publisher of the game. Aparently this haven’t changed the development process of the game, and with EA focusing on worldwide publishing, Lucasarts can concentrate on adding ideas to the game and help out with the marketing end of it.
EA and LucasArts Enter Into New Global Publishing Agreement for Star Wars: The Old Republic
In what amounts to a bit of publisher houscleaning, Electronic Arts has announced that it has entered into a new agreement with LucasArts that basically has EA taking over most of the publishing and marketing duties for the upcoming MMO Star Wars The Old Republic. Under the new agreement, LucasArts will continue to collaborate with EA and the game’s developer BioWare on the “design and marketing” for the game in addition to LucasArts’ basic role as the licensor of the Star Wars property itself. Financial terms of this new deal were not disclosed. BioWare and LucasArts first entered into an agreement to collaborate on Star Wars The Old Republic back in 2007 before the game itself was announced and just before BioWare was acquired by EA. The game itself was announced in October 2008. EA and Lucasfilm Ltd, announced today an updated global publishing agreement for the highly anticipated massively multiplayer…
Bigpoint CEO claims SWTOR won’t be profitable
Bigpoint is one of the Biggest Publishers for F2P and Browser Games and CEO Heiko Hubertz recently stated that he believes that Star Wars – The Old Republic will never be profitable with it’s current financial concept. “If you look in the traditional industry there are still a lot of big bets there,” said Hubertz, keynoting the London Games Conference this evening. “Still there are companies investing $20-40 million for a game. These companies have to be profitable after one or two months. They don’t have 12 months or even more. I think these companies are really in trouble in the future if a user can play online games for free. “If you look at a game like Star Wars from EA and BioWare, they estimated a development budget of more than $100 million. This is an online game for many million of subscribers, so a big publisher does not…