Microsoft Loses Some Game

John Schappert, widely credited for helping Microsoft (Nasdaq: MSFT  ) gain traction in video gaming, is returning to Electronic Arts (Nasdaq: ERTS  ) , where he spent years overseeing its game development studios and online infrastructure, The Wall Street Journal reports.

Color me surprised. Mr. Softy has been a hard-core competitor when it comes to gaming. Halo is an unqualified winner, and the Xbox outsold Sony's (NYSE: SNE  ) PS3 in 2008, says researcher NPD Group. A savvy tie-up with Netflix (Nasdaq: NFLX  ) for broadcasting movies via the Xbox 360 hasn't hurt, either.

So, why is Schappert returning to EA? He's filling a vacancy. Last week, John Pleasants resigned from EA to become CEO of Playdom, a self-described "social game developer" whose products are found on MySpace and similar services. Pleasants had been leading EA's online video game efforts, the Journal reports.

Schappert will take over where Pleasants left off, trying to carve out a bigger slice of the online gaming pie that Activision Blizzard (Nasdaq: ATVI  ) and China's The9 (Nasdaq: NCTY  ) profit from via World of Warcraft.

In fact, thanks to Sino superstar Sohu.com (Nasdaq: SOHU  ) and its mainland peers, digital gaming has never been bigger. Lazard Capital Markets analyst Colin Sebastian estimates that online video games now account for $11 billion in revenue, equal to one quarter of the global gaming market.

Under Schappert's leadership, Mr. Softy has enjoyed eating at that table. EA, apparently, would rather it didn't.

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Sohu.com is a Rule Breakers recommendation. Microsoft is an Inside Value pick. Activision Blizzard, Electronic Arts, and Netflix are Stock Advisor selections. Try any of our Foolish newsletter services free for 30 days.

Fool contributor Tim Beyers didn't own shares in any of the companies mentioned in this article at the time of publication. Check out Tim's portfolio holdings and Foolish writings, or connect with him on Twitter as @milehighfool. The Motley Fool is also on Twitter as @TheMotleyFool. The Fool's disclosure policy needs to rest its sore thumbs.


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  • Report this Comment On June 24, 2009, at 10:34 AM, plange01 wrote:

    all of a sudden microsoft is back in the game with its new browser bing.

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