Games For
The Millions
By Nikhil
Hutheesing
© 2000 Forbes.com
Electronic Arts is betting that
computer gamers will migrate to the Net and play games
with thousands of contestants.
AS METCALF'S LAW STATES, A network's
power rises in proportion to the square of its size.
That logic explains the Web's overnight success. Might
it apply to computer games?
A year ago Lawrence Probst, chief
executive of Electronic Arts, the Redwood City,
Calif.-based game maker, took this bigger-is-better
argument to Robert Pittman, the president of America
Online and a former member of EA's board. They set out
to assemble an on-line gaming network so big it would
outgrow any possible competitor.
Unlike the kind you play on a
stand-alone machine, an on-line game can involve
thousands of people who cooperate or compete, alone or
in groups. The fight against humans rather than
software sharpens the joy of battle, and
coalition-building heightens the challenge.
While negotiating the deal, Probst
started beefing up EA's on-line business with a series
of acquisitions. In September he bought PlayNation, a
developer of on-line entertainment, and a few weeks
later he bought a minority stake in Bottle Rocket, a
developer of on-line interactive software. In November
he paid $22.5 million in cash for Kesmai, News Corp.'s
on-line gaming business.
That same month Electronic Arts and
America Online agreed on terms: EA would pay America
Online $81 million over five years to be its exclusive
provider of games. This year AOL will offer the games
directly and through such subsidiaries as Digital
City, NetCenter and ICQ. Electronic Arts will offer
such games through a new subsidiary, Ea.com, and will
issue tracking stock, of which AOL will purchase 10%.
"The world will never be the
same," says John Riccitiello, Electronic Arts'
president, who will run the on-line venture. "We
are going to make the computer more entertaining than
your television." Subscription fees will be $10 a
month or less, depending on the games chosen.
Advertising will supply the rest.
There's one hitch: network speed.
Gamers expect an instant response when they click a
mouse or jiggle a joystick, and that's not yet
possible, given today's pokey modems and network
switching hubs. Racers who compete in EA's on-line
game, Nascar 2000, will probably collide their cars
far more often than their skills would suggest. Gamers
will also miss the rich graphics they're used to.
Donald Mattrick, EA's games designer, plans to start
with offerings that don't have to show every last
detail--virtual golf, for example.
A good start is critical because EA,
despite its lead in videogames, is still playing
catch-up on-line. Gamers can already go to Sony's
station.sony.com and play versions of such game shows
as Jeopardy and Wheel of Fortune. Microsoft's service,
zone.msn.com, lets its 10 million subscribers play at
everything from backgammon to Dragon Realms, a fantasy
world. Disney and Lycos are also in the business.
EA has made astute moves in the
past, shifting its efforts from Sega games to Sony
PlayStation games, and from cartridge games in general
to CD-ROM games. That's how it exploded in the past
nine years from 270 employees doing $72 million in
business to 2,800 employees doing $1.5 billion. Who's
to say that Probst's on-line foray won't break his
sterling record?
"Broadband networks will be
pervasive in the next four years," he says.
"We are getting in just in time."
© 2000 Forbes.com
TOP
