Video game economics in a nutshell
Five charts to start your day
I lived with video games all my life. So when I saw this data visualisation from Chartr, I got very excited. I don't really play video games anymore, but I have been trying to persuade my kids not to. Perhaps I shouldn't. I turned out being ok in the end.
What I never really understood though was the economics behind video games. They have undergone a significant transformation, as highlighted by Electronic Arts' (EA) recent analyst meeting.
While EA is looking ahead with plans for a social app, AI initiatives, and a Sims movie, its financial stability still heavily relies on established franchises like The Sims and its sports titles. I am personally a big fan of Sims.
The company's "Live Services" segment, which includes extra content, subscriptions, and in-game purchases, now accounts for 73 percent of its revenue, reflecting a shift from the traditional model of one-time game sales. Despite record-breaking sales for games like "College Football 25" and "EA Sports FC," the company faces challenges in a highly competitive and unpredictable market, where development costs are soaring and success is far from guaranteed.
Note to self, “don’t launch a video game business even thought it sounds really cool”.
Source: Chartr
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