Electronic Arts’ shareholders are running for the hills this month and for good reason.
The company’s profitable business model is now at risk after angry gamers revolted over its aggressive in-game moneymaking strategy in “Star Wars Battlefront II.”
EA’s stock is down 8.5 percent month to date through Tuesday compared with the S&P 500’s 2 percent gain, wiping out $3.1 billion of shareholder value. Its competitors Take-Two and Activision Blizzardshares are up 5 percent and 0.7 percent respectively during the same time period.
After EA gave a December quarter sales forecast slightly below Wall Street estimates on Oct. 31, some analysts suspected it was due to the “Stars Wars” title. The shares fell 4 percent the following day.
Jesus Fucking Christ.
Seriously.
Also:
The controversy seems to be hurting the sales of the game, which was officially released on Nov. 17.
First week U.K. physical game sales of “Star Wars Battlefront II” declined 61 percent compared with “Star Wars Battlefront” from two years ago, according to GfK ChartTrack data. And the game is still not on the top 100 list of Amazon’s best-selling video games year to date as of Tuesday.
…
Politicians vowed to take action to protect underage kids from the game’s monetization practices. One Wall Street analyst is even calling for the industry to self-regulate before the government gets involved.
“Battlefront II is the pointy tip of the iceberg. … The biggest recent controversy has centered around EA’s Star Wars Battlefront II, where early evidence suggests player anger over a mishandled loot box economy may in fact be impacting initial sales,” Cowen’s Doug Creutz wrote in a note to clients Monday. “We think the time has come for the industry to collectively establish a set of standards for MTX implementation, both to repair damaged player perceptions and avoid the threat of regulation.”
I can’t hear y’all over the sound of the free market finally giving EA the dicking down it’s sorely deserved.
This should also be a fair warning to other publishers.
I have observed the free market in action: it added lootboxes to the game.
The timeline is pretty clear-cut to me:
1. Beta copies have much lower prices than the release copy (this is false advertisement, which there is regulation against, otherwise the free market posts false advertisements constantly).
2. Game gers released, and there are customer complaints. Initial customer complaints were completely ignored.(That the lootboxes impacted the original sales of the game was always obvious and was factored in)
3. Further customer complaints are answered by slashing the prices 75%. Ancaps applauded this and patted each other on the back for this amazing victory. Point gain was also slashed 75%.
There was also a manufactured controversy about death threats, because corporations do that sort of thing.
They also removed microtransactions temporarily - explicitly to wait until the customer outrage dies down.
4. People submit a complaint to the European Union about illegal gambling going on. The EU plans to roll out regulation.
EA instantly shits its pants and does away with the system for good.
Regulations work, boy. Even the threat of regulations works, boy. Clear as day.
^ this tard thinks regulation caused the company’s massive loss.
The US is the larger market. EU regulation would have no effect here.
Just give it up you commie weirdo. We don’t need your authoritarianism.
Clarification: both the EU and the US are looking at regulating the game industry after this.
I am against EA’s actions and their bad business practices, and think we should raise an ungodly stink against them, but I am also against regulation of this kind, for reasons obvious.
That said, EA likely DID engage in deceptive or misleading practices (not informing players of risks, for example); if they did so, THAT is where the regulatory line should be drawn; not merely because of “digital gambling.”
If the game is literally rigged, that’s where regulatory agencies should be stepping in, and only then.
Except you also have “digital gambling” at a product marketed to teenagers, too, which is illegal in the real world.
There are multiple avenues of “why the government can/should get involved.”
Fair point; though “gambling” is sort of a weird way to construe it.
Also, if gambling directed towards teens/kids is illegal, then every chuck-e-cheese and other “arcade Park” has to ban kids, since it’s much of the same.
You know, that’s a really good point about arcades. Last time I visited home and went to the boardwalk, I was honestly saddened to see that the local arcade is almost entirely comprised of various “do the thing and win an ipod” type games now.
Are we going to regulate crane games now too?
You can try and say that this is “gambling directed towards kids”, but the fact of the matter is that the person who’s going to be purchasing the loot boxes in the end is virtually always going to be the parent.
At which point, it’s really no different from a parent buying a scratch off ticket, and letting their kid be the one to scratch it off. It’s the adult who’s actually gambling, but the kid gets all the enjoyment (and in the case of the loot boxes, they get the reward too).
Loot boxes aren’t a bad thing because they “target teenagers” which, lets be honest, they don’t target them in particular because they’re designed to get EVERYONE to buy them. Even as an adult, you have all the same reactions to opening a good loot box that a kid or teenager would, at least subconsciously.
Loot boxes are a bad thing because they encourage developers to release sub-par games and just slap loot boxes on them in order to create a consistent cash flow out of it.
Furthermore, lets say it was all directed at kids, lets even say that the kids had their own money that they didn’t get from their parents. So what? It’s not like the kid has any fuckin bills to pay if they’re living with their parents still. Spending their money on loot boxes isn’t going to suddenly put them into financial ruin.
And finally, according to the legal definition, loot boxes are not gambling. Because as far as gambling goes, you have to be able to lose. There is no “lose” condition with loot boxes. You are purchasing a box with randomized loot in it. It may not get you the loot you want, but it will still get you loot. It’s no different then buying one of those mystery party bags that are just filled with random kid shit.
In order for something to be considered “gambling”, there must be an element of chance. Specifically, a chance to win a prize. There is no “chance” at a prize with loot boxes. You always get a prize, it’s just not always the prize you wanted.
Now stop begging the government to step in and regulate things. Just don’t buy the fucking games. Your dollar does more work in a day than the government gets done in a year.
/end rant.