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A Profitable Business Model as it relates to the Madden series

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Old 03-30-2009, 05:25 AM   #1
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A Profitable Business Model as it relates to the Madden series

Does anybody ever think that, no matter how hard Ian tries (and it certainly looks like he's trying), he has more obstacles than he can overcome?

Think about it.

EA paid 9 figures for NFL exclusivity. Also, every summer, Madden ads/commercials start to appear on expensive prime time TV spots, on most popular channels, with the leagues biggest stars promoting the game. We're probably talking high 7 figures, in terms of their marketing budget.

Right off the bat, EA is probably paying close to $300M a year, in marketing alone (I'm clumping their exclusive deal in with this budget).

How much budget do you think is left to add consumer-friendly components to the game? When I say consumer-friendly components, I'm talking about things like:

- industry leading developers
- latest tools and technology (for their developers)
- better quality assurance teams
- innovation; just look at all the cool things Blizzard is doing with their IPs (a company that has won business by developing a quality product; not strong arming the competition, and having a bigger marketing budget)
- and all of the other benefits that come with having more time (more staff = more time).

Ian has ambitious goals, and seems like a smart guy, with great intentions, but, how much are the executives at EA providing him with, in terms of resources, to create a remarkable product?

If EA is extremely profitable (with a mediocre product; with more money being invested in buying out competition, and advertising the product) does it make any fiscal sense for them to invest in increasing the quality of the product?

And if they're as profitable as their annual reports say they're, can we really expect anything to change year-to-year?

Last edited by PlyrzNumber1; 03-30-2009 at 05:55 AM.
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Old 03-30-2009, 05:37 AM   #2
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Re: A Profitable Business Model as it relates to the Madden series

Quote:
Originally Posted by PlyrzNumber1
Does anybody ever think that, no matter how hard Ian tries (and it certainly looks like he's trying), he has more obstacles than he can overcome?
No, I don't think that. Ian comes off to me as the sort of person who really relishes this challenge. I think every obstacle motivates him more.

BTW: I have to thank you now for this post, because I think it, in and of itself, is helping Ian make a better game

Quote:
Think about it.

EA paid 9 figures for NFL exclusivity. Also, every summer, Madden ads/commercials start to appear on expensive prime time TV spots, on most popular channels, with the leagues biggest stars promoting the game. We're probably talking high 7 figures, in terms of their marketing budget.

Right off the bat, EA is probably paying close to $300M a year, in marketing alone (I'm clumping their exclusive deal in with this budget).

How much budget is left to add consumer-friendly components to the game? When I say consumer-friendly components, I'm talking about things like:

- industry leading developers
- latest tools and technology (for their developers)
Right there, what you're missing is that, unlike in the past, EA is moving toward a more efficient system of shared technology and tools across EA Sports developers and teams. This costs less in the long run than did developing each individual team's technology.

Also, investing in these tools is not something a developer is likely to shirk on. It's a cost saving maneuver because it puts more and more control in the hands of the producers... developers that may or may not be familiar with all that goes on under the hood... rather than forcing everything on the engineers.

Quote:
- better quality assurance teams
- innovation; just look at all the cool things Blizzard is doing with their IPs (a company that has won business by developing a quality product; not strong arming the competition, and having a bigger marketing budget)
Blizzard, quite clearly from their track record, does not deal with the deadlines that EA does. If EA could delay Madden 17 times a year, then yeah, it'd come out a lot better product. The NFL would not allow that.

Quote:
- and all of the other benefits that come with having more time (more staff = more time).
Then there's the "too many cooks" factor. At some point, adding more people to a project only slows down or complicates the process. It's not like a manufacturing job where more people means more products being produced... you can't make a second assembly line when working with a single source code. And every time the code gets changed, the master must be saved. If 3 dozen people are working with code at a given time, how many times are we going to see changes get overwritten? That's a fairly simplistic wait to look at it, but it illustrates the point in a sort of abstract way.

Quote:
Ian has ambitious goals, and seems like a smart guy, with great intentions, but, how much are the executives at EA providing him with, in terms of resources, to create a remarkable product?

Ian and Phil's greatest resource is himself and his team. He knows this. He's never made the excuse "I don't have time" or "I don't have the people". Time is a given... there are only so many hours in the cycle, you can't change that.

Quote:
If EA is extremely profitable (with a mediocre product; with more money being invested in buying out competition, and advertising the product) does it make any fiscal sense for them to invest in increasing the quality of the product?

All that was required for the jump in quality we've already seen is a change in personnel. Competence, vision, and determination count for a lot. EA doesn't have to spend a bunch of money to upgrade the people making the game. They just need to put the right people in the right place. David Ortiz wasn't the right people.

If I've seen nothing else that makes me believe in these guys, it's professional pride. These guys believe they are the best at what they do, and they're doing everything they can to prove it.

We know they have the vision (based on the technical changes they've been working on), we know they have determination (based on the sheer number of changes they've made this year), but competence is up in the air until we see a final product (though I think Michael Young has proven himself).

Quote:
And if they're as profitable as their annual reports say they're (with the Madden product in particular) can we really expect anything to change year-to-year?
I think you're putting too much stock in upper management. And you're assuming the problem was upper management to start with. I know that's been the running theme for several years now... it's the suits... I don't buy it. Who signs the paychecks has nothing to do with how well I do my job. If I'm surrounded with good people, I'll make a great product. Once again, and this is my opinion and nothing more... I think David Ortiz and others like him at Tiburon were the problem, not EA in general.
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Last edited by adembroski; 03-30-2009 at 06:39 AM. Reason: typed "compliance" instead of "competence" and repeated myself.
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Old 03-30-2009, 06:20 AM   #3
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Re: A Profitable Business Model as it relates to the Madden series

I deleted my last message, as it wasn't relevant anymore, after you edited your post into a longer and more well thought out, and well articulated point.

I think Ian and company seem very determined, and passionate. But there's almost no *good* argument that can be made, that can deny the fact that more resources greatly increases the chance for a better product.

More resources always equals more time.

As far as on the field gameplay, I can see how too many hands might be a bit cumbersome, but I'm sure there's intelligent people out there, that know how to leverage the work of a bigger and higher quality development team.

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Old 03-30-2009, 06:34 AM   #4
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Re: A Profitable Business Model as it relates to the Madden series

I can concede most of those points, but are there not more efficient ways to address all of them?

At one time, Madden's ratings were done by an outsourced agency. One who's primary business was compiling statistical information for professional teams. I do not remember seeing a massive drop off in ratings quality after the Madden team took over the job directly.

Admittedly, the idea that there's one guy who builds the playbooks and one guy who does the ratings confounds me a bit, but there's an argument to be made about consistency. If you ask 32 people what Joe Montana's arm strength should be, you'll probably get 32 different answers. If 32 people are doing the scouting for Madden, you're going to have 32 different levels of aptitude, 32 different ways of making judgments. Even if you still only have one guy making the final decision, it's still 32 different sources. Maybe my definition of "above average" is a bit more conservative than yours.

And to be completely honest, I have yet to find the columnist or beat writer or, hell, ESPN analyst that's truly qualified to scout NFL players.

Just covering one of your many good points and more or less playing devil's advocate with the rest.

I think the main point to consider, above and beyond all of this, is what company in the world, especially one as successful as EA, thinks "profitable" is enough? If Frazier produces something that significantly outsells what they already had, you don't think they'll dump a bit more on him and see what he can really do?

In other words; if Madden 10 is as much better than Madden 09 as we think it might be, and the sales reflect that, EA will dump more resources into it, because no company is satisfied with what they make. If they were, they'd be a terrible company. I sure as hell wouldn't invest in a company I didn't believe was doing everything they can to maximize profits.
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Last edited by adembroski; 03-30-2009 at 06:36 AM.
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Old 03-30-2009, 06:46 AM   #5
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Re: A Profitable Business Model as it relates to the Madden series

I edited the list of points, as I thought they detracted from the focus of the thread. Just wanted to give you a heads up if you re-read my post.

Anyway, you bring up some solid points, and have introduced an interesting and essential perspective.

Last edited by PlyrzNumber1; 03-30-2009 at 07:02 AM.
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