This is revenue, not profit, also, which means middle man, its "money in" to the company. Given you already pay for PC games at considerably less cost, I'm not convinced of the argument that PC is simply up there because they get a bigger slice.
They clearly do, but on the other hand, compare the PC space without deferred revenue..
38% of EA's actual money of games sold is on PC.
22% on Xbox.
17% on PS3.
It all means zero of course if you cant turn a profit. Which EA didnt do this 1/4.
They write to much in a deffered income, then have to write it out again when their games get sold at a lower price.
Think of it like this.
EA sell 2 million copies of Battlefield into stores, they recieve money for these games, but they only sellthrough 1 million units.
They have a 1 million copies (say $35 each) they recieved from the like of Game Stop etc. Thats $35 million they have, but ar ehoping to sell in the future/
So that get written down as -350 million.
Then they stuff it all up by deciding to drop the price of games, strategically to garner a few more sales, say half price.
They have to pay back $175 million (usualyy in form of rebates or credit)
This comes back and bites them in the butt next 1/4.
This is that collosal $464 million in changes in deffered revenue that they wrote of last 1/4.
Compare their deffered revenue in PC gaming....it's half what it is on the Xbox and PS3.
In other words, digital copies dont garner deffered revenue. A digital copy sold.Is just that. Straight to the consumer.
A retail product sold is actually a liabilty.
Thats why the industry wants to go digital. Not to screw the 2nd hand market over.
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Last edited by mynd; 08-09-2012 at 04:02.
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