EA to Support Xbox Live

Video-game publishing giant Electronic Arts (EA) has agreed for the first time to support Microsoft’s Xbox Live online gaming service. EA’s decision, a major vindication for Microsoft’s online gaming strategy, results from the growing popularity of the Xbox console, demonstrated demand for online sports games, and strategic moves by Microsoft. The company also previewed some forthcoming Xbox games, but it is staying silent about the successor to the console.

Why EA Changed Its Mind

The EA deal, announced at the May 2004 Electronic Entertainment Expo (E3) conference, represents a major win for Microsoft. EA, which dominates video game publishing (22% of all PC and console video games shipped in North America are EA titles), already offers online-enabled versions of several games for Sony’s PlayStation 2 (PS2), including its popular Madden NFL Football title. Although EA has released offline-only versions of Madden NFL and many other games for Xbox, the publisher declined to support Xbox Live out of concern that it would dilute the EA brand without contributing much to EA’s revenue. (Microsoft collects and keeps subscription fees from Xbox Live users, although publishers may charge users extra for items such as downloadable content.) EA also believed that its cross-platform dominance would let it create successful online services without catering to Xbox users.