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Games-as-a-Service Model Has Helped Activision and EA Grow Exponentially Since 2012

A report by DFC Intelligence has revealed that the Games-as-a-Service (GaaS) business model has helped Activision and Electronic Arts grow their market value by a combined $79 billion since 2012.

In the last 6 years, EA’s market value has increased from $4 billion to $33 billion, and Activision’s market value has increased from $10 billion to more than $60 billion.

EA’s live service games include The Sims 4, Star Wars: The Old Republic, Star Wars Battlefront, Battlefield (Premium Pass), Madden (Ultimate Team), UFC (Ultimate Team), and FIFA (Online and Ultimate Team) among others.

Meanwhile, Activision’s success can be attributed to games like Call of Duty, Destiny, and Overwatch.

DFC also noted that both publishers continue to see a shift towards digital. EA’s digital revenue grew by 31 percent in fiscal 2018, and during the same period, the publisher’s physical game sales declined by 17 percent. Most of the digital growth has been attributed to live service games.

Activision’s digital profits soared partly due to its acquisition of Candy Crush developer King – a mobile gaming giant. In the year following the $6 billion purchase, Activision saw its digital profits increase by a whopping 94 percent.

DFC’s report also offers other examples of GaaS success, including Lineage M developer NCSoft, which earned $1.6 billion in revenue in 2017.

It’s no surprise then that GaaS has become increasingly popular among video game publishers, with major companies like Square Enix pledging to develop games that customers can “play longer.”

[Source: DFC Intelligence via GameDaily]