EA regrets not backing Nintendo’s Wii console from Day One
John Riccitiello took over as the current Chief Executive Officer of Electronic Arts back in 2007 and has managed to life the Third Party giant out of its rut by reorganising the company’s product lines, bringing in fresh management and mixing up its development duties, choosing to focus more on game quality, rather than pure quantity. But Riccitiello does have some major regrets that he openly talked about in a recent interview.
Speaking with Mercury News he pointed out that development resources are now being shifted over to Nintendo’s Wii, as well as the company choosing to make wise purchases, picking up a few game studios that Riccitiello himself ran prior to joining EA. Unfortunately, though, in part due to misplaced loyalty in supporting the Xbox 360 and PlayStation 3 so heavily and not getting much back, EA has struggled financially lately, posting a US$454 million net loss in the last fiscal year that ended on 31st March this year. Riccitiello had this to say on the matter:
Mercury News: How would you assess how this console cycle has gone so far from EA’s standpoint? Is there anything you would like to see the console makers doing that they’re not doing right now?
John Riccitiello, CEO of Electronic Arts: The cycle is a lot like the past. There is a lot of innovation, probably more this cycle than even the last cycle; a lot of growth; a lot of exciting things. And we can choose to take advantage of those things.
One thing that’s different is we typically figured out who the market leader was going to be before the start of the cycle and bet with our development resources on that platform. We made the wrong call there (by betting on the PlayStation 3 and Xbox 360), which made this transition harder than it would otherwise be. But now we’re catching up, and I think we’re fine. We’ve got some incredibly innovative Wii titles, incredibly innovative DS titles coming. And so I think that issue’s sort of behind us. I am very happy that (the console makers) continue to drive an expanded install base, so I’ve got a bigger universe to sell into. But we’ve also transcended them a little bit. We’ve got a big mobile business, a big PC business, a big direct to consumer business, increasing advertising business, microtransaction business, subscription business - all things that live outside the world of (selling console games).
Mercury News: But given your investment in developing games for the PlayStation 3 and Xbox 360 - and the relatively slow sales of both of those consoles to date - isn’t it in your interest that Sony and Microsoft do something to juice sales of those boxes?
John Riccitiello, CEO of Electronic Arts: No, it’s not. It’s in my best interest that more consumers buy consoles. My job is to make sure that against the consoles and platforms that matter, we’ve got the right content. I can wish for there to be more PS3s or Xbox 360s in the marketplace. Wishing doesn’t make me an effective CEO or EA a successful company. Right now, you’re seeing an increased emphasis on Wii and DS titles, so we can drive a market on Wii and DS that’s similar to what we have on the Xbox 360 and PS3. If we are successful there - and we will be - over the course of this and next year, it doesn’t matter to me which platform prevails. This cycle is like every other cycle before it: There’s been a dominant player (in this case, the Wii). Unusual in this cycle is there’s a second and third place that is meaningful, against which we can build a profitable business. That’s a good and positive thing.
He continued by stating that he believes that EA can eventually gain as large a market share on the Wii console in the near future as it did previously on the PlayStation consoles and other formats, stating “Yes. Tomorrow? No. Can I make a big step in that direction this year? Yes. Can I continue to make steps in that pattern? Yes. Does Nintendo want us to do it? Yes. Does the platform set itself up for that to be possible? Yes. So, it requires focus.”
But do you agree that Electronic Arts was betting on the wrong horse(s) right from the start, or was it perfectly right to keeping churning out its titles on PlayStation 3 and Xbox 360 whilst giving Wii ‘casual’ scraps like Smarty Pants and Ninja Reflex? Be sure to share your opinions on the matter by posting below…
How is betting on 360 the wrong call? Xbox 360 is selling just as well as Wii. Both consoles are killing the PS3, so I don’t see how he can say Xbox 360 is doing bad.
But EA does need to put more quality games on Wii. Develop games that use the more traditional Classic Controller or GameCube controller, that is what they’re there for.
I was a bit surprised by some of the comments as well. But perhaps it’s more to do with the cost of making games on 360 compared to the returns from sales not being as high as expected.
ummm… wii is outselling both it’s competitors, check the sales figures.
EA like other third parties were caught off guard by the Wii’s success. Based on how the Gamecube performed you can see their reasoning. Even Nintendo was caught slightly off gaurd, look at the continued console shortages nearly 2 years after Wii’s release. But now that Wii has estabished itself its time to see results. Appealing to casual gamers is fine just don’t forget about us core gamers. With the revealing of MotionPlus there’s even more incentive to produce quality games.
Wii sold more than 360 and it was released a year later than the latter; so they are not selling the same. I just hope that by more support EA means quality hardcore games and not only mini games.