May 21, 2007
EA signs Number Nine to score goals in China
Electronic Arts became the world’s biggest video game publisher without ever having a serious impact in Asia.
That may be changing. On Monday, it announced it was taking a 15 per cent stake in The9, one of the leading online game operators in China, for $167m.
EA has been unable to make an impression in China with its boxed titles due to rampant piracy. Gamers also seem to prefer playing massively-multiplayer online games in internet cafes. Vivendi’s World of Warcraft has been the only Western game to make a significant breakthrough into a market dominated by home-grown or Korean games.
EA thinks it can find a paying-subscriber market in China with the help of The9 and soccer. The9 now has exclusive publishing rights for the online version of its FIFA game, EA’s biggest international sports franchise.
EA is repeating its earlier strategy in Korea, where it invested $105m in the online gaming company Neowiz in March for a 19 per cent stake. Last year, it partnered with Neowiz to launch FIFA Online in Korea and the game has attracted 4.4m subscribers.
“We’ve got the right business model and the delivery mechanism right [in Asia],” said John Riccitiello, EA’s new chief executive, in his first earnings conference call with analysts this month.
That hasn’t been the case in the past, but partnering locally to develop its franchises for Asia and delivering them online to regular subscribers is now keeping EA “in the game”.
I wonder if this will work for them in the long term. As the wealth of China and other Asian nations goes up will they start to gravitate towards buying their own computers and Playstations, etc.? Then they will be less dependent on Internet Cafes where the only games that available to them are these large multiplayer titles. But this could just be a way for EA to get a foothold in an emerging market.
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Posted by: Refined Rogue | May 22nd, 2007 at 10:22 pm | Report this commenthttp://www.refinedrogue.com