As I mentioned earlier, the fickle mentality of its target audience is proving to be one of the biggest challenges for the gaming industry, and companies such as Electronic Arts
Imagine this: You start playing a game on your tablet computer, take a break as you attend to something else, and later restart the game on a console from the same point where you left off. Now that's what I mean by seamless connectivity. And if Electronic Arts can successfully pull this off, it might very well be the next game changer.
At the same time, this may be the company's last chance to counter the growing pressure from relatively inexpensive mobile-based games and casual online gaming. For instance, recent data from the NPD Group reveals that sales of new video games and related accessories have fallen by as much as 32% in April from the year-ago period. This is happening primarily as customers move away to newer on-the-go game-playing hardware such as tablets and smartphones.
Coming back to specifics, if there is any one factor that has proved to be a major letdown for the company, it is undoubtedly Star Wars: The Old Republic. After spending truckloads of cash trying to promote its biggest massively multiplayer online role-playing game, or MMORPG, the company revealed, during its recent fourth quarter, that its tally of actual subscribers has fallen to 1.3 million from 1.7 million in the previous one. The alarming truth is out: Customers are not willing to pay up and are more inclined toward casual, trial-period gameplay.
The Star Wars debacle has proved all the more disappointing as the company went all out to position the game as the next biggest best-seller, after larger rival Activision Blizzard's
EA does have a lot of catching up to do. While its stupendous brand portfolio continues to be its biggest strength, the company has a long way to go in an industry where retention and creativity seem to be the two major buzzwords. This is one company I'd be keeping a close watch on, and if you want to do the same, be sure to add Electronic Arts to your free watchlist.
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Fool contributor Subhadeep Ghose doesn't own any shares in any of the companies mentioned above. The Motley Fool owns shares of Facebook. The Fool owns shares of and has written calls on Activision Blizzard. Motley Fool newsletter services have recommended buying shares of Activision Blizzard. Motley Fool newsletter services have recommended creating a synthetic long position in Activision Blizzard. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.