Electronic Arts: Battlefield Heroes Business Model Is Brilliant

Battlefield Heroes is a cartoon action shooter game for the PC. Exactly the sort of game where you would expect to see well over 90% piracy. Which is the reason publishers have largely given up on them. So Electronics Arts (ERTS) have beaten the pirates by giving the game away for free as a download. Obviously they still need to pay their staff, so they have implemented a couple of different business models.

The first is advertising. Not in-game, as that can spoil the experience unless the advert is actually a part of the game itself. Instead EA have put the adverts on the game website and on the front end of the game, where they don’t detract from the gaming experience.

Then there is the purchase of in-game items: the Kommendant’s Coat, the Special Forces Officer Cap, Maverik’s Sunglasses, the Elite Camo Trousers and the Marksman’s Honor being the most popular. Players can also buy advancement widgets which allow players to earn hero abilities and purchase better weapons, and emotes such as the robot dance, laughing, throat-cutting and cheering.

EA have dumbed down the specification of PC that the game will run on so as to give themselves the biggest possible audience. A trick that Runescape and World of Warcraft also do. They also reduced the spawn time from 15 to 5 seconds so there is a lot more action and less waiting.

And it has worked. The game went into “open beta” at the end of June and there are now 1.5 million players from 133 countries registered. The average buyer of in game items is spending $20.

This is brilliant for EA and has the following advantages:

• No need to manufacture physical plastic and cardboard inventory.
• No shipping, warehousing and other logistics costs.
• No margin given away to distributors and retailers, all the revenue comes to EA.
• No piracy. None. Zero. In a market riven with piracy.
• A long tail. It effectively costs EA nothing to keep this up on their server for ever. And players will be buying in-game stuff for a long time to come. The exact opposite of a retail game that gets thrown off the shelf after a short life.
• Potential to refresh the game to maintain interest. For instance currently it is third person only, first person could easily be added later to give a whole new gaming experience.
• Reaching new markets. Getting to 133 markets means they can reach Mongolia, Sudan and lots of other places where it is not worth setting up distribution for physical stock. But all added together they will now make a nice contribution to profits and allow EA to build for the future.
• Enhanced direct relationship with game player. This is immensely valuable and can be leveraged in a myriad of ways.

That is a whole lot of very good stuff and must surely presage the end of boxed, retail PC games. The success of Battlefield Heroes added to the explosion of application stores and the various business models on Xbox Live have radically brought forward the day when high street retail has no relevance to the video game industry.

Comments

[ProfitPower:]

You need to research the Battlefield Heroes gaming environment before making such claims.

They are plagued with the same EA issues, Hacking, customer support etc. Although, I agree the business model is brilliant, the way EA is handling the environment is not.

Look over some of my opinions here: finance.google.com/gro...

I have been researching Battlefield Heroes for over nine months and will continue my research.

Happy farming,
DrowsyJay

Aug 21 04:22 PM

[SafisKusai:]

I see a bunch of problems with this. First of all I see this game as a huge ripoff of Valve's Team Fortress 2. And then secondly Valve through their Steam Powered distribution system revolutionized the online distribution system with anti piracy and anti hack/cheat software about 5 years ago. Steam Powered has hundreds of titles with most of the major game Distributors for EA to try and set up their own system that most likely won't compare seems silly. Steam has been doing this for years and they have been very successful.

The fact that this game looks almost exactly like TF2 I think will be a major turnoff to people. And the whole buying items in game thing looks like it is a lot like the play for free game Combat Arms by Nexon where you can buy the games currency to buy special weapons and clothing. When you are new at this sort of thing your games become riddled with hackers and cheats (which was the major downfall to Combat Arms). You say that people will be playing this for a long time and that may be true for real die hards but there is always the next big fps with better graphics, gameplay, and story and those are what make the game companies money.

At least EA is trying to get something to work.

As a disclosure I am long ATVI.

Aug 23 01:57 AM

[ProfitPower:]

"Battlefield 1943 for PC delayed to Q1 2010: Another Failure By EA all it's going to take is one more new entrance(Game) to bury the BF franchise (loss of market share).

Battlefield Heroes is great and a fantastic (Miss-managed) opportunity for EA/Dice,it isn't enough. Electronic Art's must recognize hardcore
warmongering gamers need the B.F. & C.O.D gaming environment, the root of this gaming environment stems from the interest of PC users.

EA must consider this from a Marketing/ Public Relations perspective,PC users build Websites, Clans, Promotions, and they also provide
the most effective(reach) source of advertising(Word of Mouth).In-general PC gamers spend more quality time on PCs(Web) more than any other platform, and In my opinion, The forced shift from PC to PS3 isn't going as intended.Electronic Arts must figure out effective Consumer Relations strategies and stay true to their base of origin. " finance.google.com/gro...

Aug 23 10:12 PM

[jack dee:]

well said, now where did I put that backburner.


On Aug 23 01:57 AM SafisKusai wrote:

> I see a bunch of problems with this. First of all I see this game
> as a huge ripoff of Valve's Team Fortress 2. And then secondly Valve
> through their Steam Powered distribution system revolutionized the
> online distribution system with anti piracy and anti hack/cheat software
> about 5 years ago. Steam Powered has hundreds of titles with most
> of the major game Distributors for EA to try and set up their own
> system that most likely won't compare seems silly. Steam has been
> doing this for years and they have been very successful.
>
> The fact that this game looks almost exactly like TF2 I think will
> be a major turnoff to people. And the whole buying items in game
> thing looks like it is a lot like the play for free game Combat Arms
> by Nexon where you can buy the games currency to buy special weapons
> and clothing. When you are new at this sort of thing your games become
> riddled with hackers and cheats (which was the major downfall to
> Combat Arms). You say that people will be playing this for a long
> time and that may be true for real die hards but there is always
> the next big fps with better graphics, gameplay, and story and those
> are what make the game companies money.
>
> At least EA is trying to get something to work.
>
> As a disclosure I am long ATVI.

Aug 24 12:49 PM