EA wants to place in-game ads in its full-price AAA games, again
EA wants to place in-game ads in its full-price AAA games, again
Speaking during the company's latest earnings briefing, EA CEO Andrew Wilson said in-game advertising could become a "meaningful driver of growth" for the firm.
EA has tried this before, with predictable results. In 2020, EA Sports UFC 4 included full-screen ads for the Amazon Prime series The Boys that would appear during 'Replay' moments. These were absent from the game when it launched, with EA introducing the ads about a month later, thereby preventing them from being highlighted in reviews. It wasn't long before the backlash led to EA disabling the ads.
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I know that I've played EA games before, but I don't think that I've played stuff from them recently, so I don't have a personal preference on their games.
As long as they also provide some option to pay more and not have ads, I don't really see an issue. It just becomes another option to buy the game -- if you want ad-supported, can do that, and if you want to pay directly, you can do that.
If they don't have any option to pay for an ad-free experience, then it seems like it could be obnoxious for people depending upon their ad preference.
I think that all the games that I would play -- setting aside the issue of EA specifically -- I'd rather pay for an ad-free experience, but eh. Games with ads -- as well as the option to buy an ad-supported or ad-free version at different prices -- are a major thing on, say, mobile, so obviously there are people who would prefer the ad-supported route.
Back in 2022, EA patented a system that generates in-game content and ads based on a person's playstyle.
Personally, I don't really think that I want to have my activity logged and data-mined either way, though. I would pretty much always rather pay more than have my activity recorded. I care more about that than the ads. I'm fine paying more for that, but I want the opt-out. I'd also really prefer that vendors like Steam make it very clear that if a game is being subsidized by extracting data on a user, what data is being extracted. Right now, it's kind of a free-for-all, and the games aren't running in a jail, so they can do pretty much whatever. I think that just making assumptions about what they do isn't a great idea.
I remember when I saw a comment from some guy in an airport whose phone first set off an alarm and then told him that his gate had been changed and started giving him arrows to the new gate. He hadn't told Google that he was flying anywhere. This was also back when Location Services was pretty new, so people were less-familiar with it. What had happened was that (1) Google had his location, (2) while he was indoors, while GPS didn't work well Google had identified the location of other fixed devices with Bluetooth and WiFi radios emitting unique identifiers based on other people's phones reporting them and building a global database, (3) Google could infer his position from getting their signal strengths, (4) Google had been scanning his email, seen the email that the airline had sent him about a gate change, scraped the email, and determined that he'd had a gate change.
That could be a useful feature, but the point is that he had no idea that any of that was happening or that Google was making use of the data at the time. And that was many years back -- I guarantee that data-mining has gotten no less-intensive.
I remember talking to one friend who was a software engineer in the video game industry who was involved with some game where -- after recording your gameplay for a while -- they could, with pretty good accuracy, based on correlation with past users, infer with reasonable accuracy data that included one's IQ and a set of "employability" statistics. That's probably got value to an employer, but I suspect that most people aren't thinking that they're in a job interview determining their future employment status when they're playing a video game in their living room. Like, if you're working out what a video game costs, you probably aren't thinking about the potential for it to creates information asymmetries in future job situations, where a potential employer has more data about you than you do about them.
Counter point, if I paid $60 for a game, i don't want ads in that game
If I paid >$0 for a game I don't want ads in that game.
Season passes, in game stores, and every other mtx in a game I paid for is insulting and generally ends up being intrusive and annoying since they tend to shove it in your face.
Counter-counter-point, “Devil’s 🥑,” games have cost $60 ($70 with the most recent generation) since, what, 2006? 2007?
$60 in 2006 is over $90 today.
So we’re paying less upfront for games now than we were in 2006. Yet costs to develop AAA games have gone up significantly.
I’m not saying ads in games is a good idea, I fucking hate ads. I also hate microtransactions. But every time prices go up people get angry. Remember the backlash when Xbox Series X and PS5 prices were standardized at $70?
I don’t know the solution. But the current trends are unsustainable. Just like everything else in late-stage capitalism.
This is an argument publishers love to make, but it's bullshit. Yes, games (assuming you ignore in game purchases/DLC, which you obviously shouldn't but I digress) have got cheaper in real terms due to inflation lowering how much $60 is really worth, while games have stayed at that price tag.
It's also true that development costs have went up.
Now, here's the part that game publishers conveniently never talk about: distributing games is far cheaper now. We're usually not shipping pallets of discs that take up loads of space and cost money to physically create and transport, while also having to build in a profit margin for all the middlemen along the way, including for the retailer. We predominantly buy games digitally.
On top of that, gaming used to be niche, now everybody does it. The market is far larger, so they don't need to charge a lot to still make bank.
Now, here’s the part that game publishers conveniently never talk about: distributing games is far cheaper now. We’re usually not shipping pallets of discs that take up loads of space and cost money to physically create, while also having to build in a profit margin for all the middlemen along the way, including for the retailer. We predominantly buy games digitally.
On top of that, gaming used to be niche, now everybody does it. The market is far larger, so they don’t need to charge a lot to still make bank.
Great points! And yes, they're almost never talked about!
They also have far better scaling on sales than they did in 2006, with tons of storefronts and easy access for anyone to download and play a game without needing to go to a physical store.
People like to complain about steam taking 30% of a sale, but it isn't like game companies were getting 70% of a boxed game on a shelf. They had manufacturing, shipping, and a ton of other costs for physical media that they don't spend on digital sales that can scale infinitely in an extremely short period of time because it can't sell out locally.
If they are spending too much for their return, then they need to scale back their spending.
It's not our responsibility to help their shareholders make money.
We are purchasing a product from them, or a service, and we expect it to work, and not market us when we are using it.
If the cost of manufacturer is not being covered in the sales price to the customer, then they need the raise prices, or go out of business.
Or tell their shareholders to go pound sand.
Even though costs of AAA games have gone up for some games (certainly not all) because of the size of teams/labor hours, so have the volume of sales. Publishers have made more and more profit while the average price of AAA games had stayed about the same for a long time.
Games selling in the hundreds of thousands was considered really good decades ago but now those are in the tens of millions.
Publishers aren't having problems with profitability, so much so that they've been buying up large swaths of development houses and IPs and then dismantling them when they have a single flop.
EA's gross profit in 2010 was $1.6B, in 2014 was $3.03B and in the past 12 months have been $5.8B right now according to macrotrends.
But the current trends are unsustainable
The current trend in profitability is increasing, not decreasing. It isn't a minor trend or minor increases either.
Major publisher profitability has vastly increased in spite of stagnant game prices. They don't have to increase prices to increase growth. It is simply that the market allows the increase of the price with more profitability and so they do.
A business model wherein the thing someone makes and sells brings in a profit just by customers buying the thing, without the long tail of continuing to sell the customers' eyeballs to whoever forever after, is not an unreasonable concept. Countless indie games and smaller publishers have managed this for generations and still do.
If EA and the other massive blockbuster publishers can't figure out how to make their business model work in a non-exploitative manner, too damn bad about it. We don't actually need them.
Even though costs of AAA games have gone up for some games (certainly not all) because of the size of teams/labor hours, so have the volume of sales. Publishers have made more and more profit while the average price of AAA games had stayed about the same for a long time.
Games selling in the hundreds of thousands was considered really good decades ago but now those are in the tens of millions.
Publishers aren't having problems with profitability, so much so that they've been buying up large swaths of development houses and IPs and then dismantling them when they have a single flop.
EA's gross profit in 2010 was $1.6B, in 2014 was $3.03B and in the past 12 months have been $5.8B right now according to macrotrends.
But the current trends are unsustainable
The current trend in profitability is increasing, not decreasing. It isn't a minor trend or minor increases either.
Major publisher profitability has vastly increased in spite of stagnant game prices. They don't have to increase prices to increase growth. It is simply that the market allows the increase of the price with more profitability and so they do.
I was going to read all of this until I got to "provide some option to pay more and not have ads" . Zero chance this would ever end in a consumer friendly way after that first payment.
Same, if you've already paid a premium for a "AAA" game. Paying more to no have ads is insane. I'll just not play those games, thanks.
This is some of the most corpo boot licking drivel I've read in a long time. It sounds like someone who has been locked in a tiny cell and forced to watch shareholder presentations on repeat. Only to be released when they can explain why all people want to be marketed to.
Pay extra for a non-ad experience? Ad preference?
Get the fuck out, and stop making shit ass mobile games.
gluck gluck gluck please let me pay even more money for the privilege of not being advertised to, corpo-daddy
"Oops we spilled some ad juice on the game server better pay us some more so we can have all the ad juice removed."