Electronic Arts: Battlefield Heroes Business Model Is Brilliant

| About: Electronic Arts (EA)

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.