Will EA embrace the Free Pirate game Business model – iPhone like?

Nick — Wed, 24 Jun 2009 22:29:11 +0000

For years game publishers could rely on the sales of relative expansive game discs to gain their profits. But then together with internet the peer-to-peer networks came up which made it easier for consumers to find cheap alternative solutions to play their most favorite games. After years of fighting against this change in consumers behavior EA now tries to find a new business concept where they could actually make use of this new network possibilities. Buying a disc (or downloading the game) is only a one-time transaction. Once games are connected to the EA server network then extra recurrent micro-transactions are possible. Extra levels, game add-ons or even third party sales could take place inside the game in order to expand the game experience. Possibly this second transaction could become so large that in the end the first transaction would become insignificant. In that case pirated versions of game are just a part of a demo program of a game publisher.

Once you understand that revenue could come from these kind of transactions then you know why Apple for instance doesn’t force old iPhone user to buy new iPhones in order to make use their new software updates. Apple will earn the biggest amount of money with the sales inside the different apps. So when more users have access to the iTunes iPhone store, the more revenue can come in. Then you also know why Apple doesn’t focus on a broad range of iPhones. Nokia on the other hand does and by doing this they still are trying to make their money on the margins of actual cell phone sales like EA did with the actual sales of game discs.

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Disrupted businesses by iPhone 3.0 features like in-app commerce

Nick — Tue, 17 Mar 2009 19:54:52 +0000

Apple is the only company that could get an applaus for the implementation of trivial product features like copy/paste. During the widely discussed iPhone 3.0 launch this evening they had of course more and better product features to announce: Peer-to-peer connectivity, improved accessory support, an in-app store,…

But Apple didn’t launch just product features, they rolled out new revenue concepts. Cut and paste took a while to implement simply because there is no money in it. But there is a lot of money in purchasing add-ons inside games and paid content subscriptions. Selling virtual weapons and levels is only one thing. This was just to illustrate the potential.

What Apple really did was launching a platform to sell any kind of good in any kind of application available to any user anywhere. This will transform iTunes into a wholesaler instead of the digital (music) store as we know it today. And once other parties develop the products and services on which Apple will take big margins thanks to the in-app purchases, they will be in the in-game selling model we’ve just illustrated.

I then I didn’t even mention the potential of the micro-payment integration offered by the new transactions app. But it must be clear that Apple has a clear view on making money.

The Board Of Innovation » iPhone

Will EA embrace the Free Pirate game Business model – iPhone like?

Disrupted businesses by iPhone 3.0 features like in-app commerce