Business Models EA Each major player has focus

Business Models (EA) Each major player has focus on particular genres and channels with fairly significant variation in EBITDA margin; EA higher cost structure due to larger number of titles and product quality has recently lagged Business Models Business Model FY 13 Revenues / EBITDA $4. 6 bn / $1. 7 bn (37%) $1. 2 bn / $698 m (30%) $873 m / $63 m (7%) $1. 6 bn / $607 m (38%) $7. 7 bn / -$288 m (-4%) $4. 0 bn / $944 m (24%) Strategy n Strategy: Produce development based on franchises that have potential to sustain customer appeal over long periods of time n Strength: Specializes in first person shooter & open world concept games n Weakness: Mobile & social gaming trend are not priority n Strategy: focus on organic growth & capitalize on digital distribution initiatives n Strength: Strong developers 2 K Games and Rockstar Games n Weakness: Dependent on success of a couple of franchises n Strategy: Strong focus on developing mobile games based on consumer demand n Strength: Successful franchises that generated large amount of attention and demand n Weakness: Volatile revenue driven by dependency on hit or miss titles n Strategy: Bring social and interactive experiences to its games, with focus on creating games for new console platforms n Genres Geography n Hardcore gamers n North America (53%) n World of Warcraft, Call of Duty, Starcraft, Guitar Hero n Europe (40%) n Asia Pacific (7%) n Hardcore gamers n North America (47%) n Grand Theft Auto, 2 K Sports titles n International (53%) n Casual & social gamers n North America (60%) n Farmville, Zynga Poker, Words with Friends n International (40%) n Hardcore gamers n North America (50%) n Assassin’s Creed, Just Dance, Ghost Recon n Europe (40%) n Asia-Pacific (6%) n Other (4%) Strength: A couple strong franchises that generated attention, along with benefits of Uplay, its online distribution portal n Weakness: Historical poor performance in casual game market n Strategy: Content-first strategy, believing hardware sales will follow n Hardcore gamers n Japan (33%) n Strength: Strong brand after +25 years in the video game industry and historic popularity of their console games n Mario, Pokémon, Wii Series, The Legend of Zelda n North America (37%) n Europe (27%) n Other (3%) Hardcore/Casual gamers n North America (42%) n International (58%) n Weakness: Continued decline in Wii and DS game sales n Strategy: Obtain a higher digital mix of revenues and develop select number of blockbuster titles for console & digital games n n Strength: Proven and strong franchises (EA Sports) that bring stability to revenue stream n n Weakness: Difficulty in developing blockbuster hits, execution of game releases, poor game quality , low customer satisfaction 2017 Copyright © NIBCLive. com – Not for Redistribution Sims, Need for Speed, Madden NFL, FIFA