EA Makes Twice as Much from DLC as it Does from Selling Full Games Online

By Julian Benson on at

There's a fascinating table in EA's Quarter Two Financial Year Results. OK, quite fascinating table. It reveals something of why EA is so DLC-happy. The publisher makes more than twice as much money from DLC than it does from full games digitally.

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The table shows that in the second quarter of this financial year EA made $89 million from its digital game sales and $195 million from "Extra Content". Hell, EA made $83 million solely from subscriptions and season passes.

This time last year, EA had made $153 million from "Extra Content" so it's seeing massive growth in the amount of cash it's making from DLC and "freemium" content.

The freemium part of the Extra Content is key. Things like the card packs in Fifa's Ultimate Team app, say. Card packs that EA's chief financial officer, Blake Jorgensen, attributes the growth to in particular. In a financial call to investors, Jorgensen says "Extra content and freemium contributed $195 million, up 27% over the prior year. The principal driver of the growth was Ultimate Team across our sports franchises." Card packs aren't a buy-once sort of microtransaction, like buying new levels for Battlefield is; instead they encourage you to return again and again to buy more card packs so you can collect the complete set. Some people have spent hundreds of pounds on Ultimate Team cards, compare that to a £40 season pass and you can see where EA is making its money.

The important point about the graph above is that it only accounts for digital revenues and not total game sales. However, Jorgensen reveals that, except for FIFA (which is primarily bought in shops), EA's games "averaged around 20% full game downloads". This suggests that all told EA made about $450 million on full game sales in the last quarter, meaning DLC makes EA nearly half as much money as all its full game sales.

Jorgensen also makes the point in the investor call that digital game sales are only set to increase because currently EA "still sell gen 3 products [PlayStation 3 and Xbox 360 games]. And gen 3 products are typically doing full game downloads at a much lower level." Another thing he thinks will change is the quality of internet: "two factors bring down full game downloads today in Europe: one is bandwidth speeds in some countries; and two is many retailers in Europe, particularly in Great Britain, use FIFA as a way of driving traffic into the store, and they like a physical copy to help do that.

"We're seeing very strong full game downloads continue in North America. And as a reminder, the PC business that we have, we see full game downloads there roughly 75%. And so there's still a lot of headroom, we believe, in the full game download opportunity for us, going forward."

With that level of success from DLC and microtransactions you can't expect EA to move away from the model any time soon, particularly as the money its making is growing yearly.