Electronic Art has become one of the biggest players in the gaming industry, but its reputation hasn’t grown along with it.
You might think that I made that title up, that EA was the most hated company according to my own standards, but I’m not making this up. EA was the fifth most hated company in the United States in 2019, only followed by the NFL at third, Fox Entertainment at two and Equifax topping the first spot.
A simple Google search and you will discover that a lot has been said about Electronic Arts (EA) already, but it’s still an interesting case to look at from a Marketing/ PR standpoint. A lot of mistakes have been made over the years, which can be boiled down to trying to turn creativity into a product. And sure, music and all other creative products have a commercial goal. But at some point, you’ve stretched the limits of how long you can maintain a certain business model to turn a profit. EA in that respect is an interesting case study because its success has become its downfall. Albeit, they are still around and making billions of dollars in profits, but with a reputation that would give any CEO sleepless nights.
Electronic Arts has been around for quite some time now with an interesting backstory from its founder with some very humble beginnings. Former Apple Employee, Trip Hawkins founded EA in 1982. But Trip wasn’t just any employee at Apple, he was the Director of Product Marketing. While this seems minor, it’s an important factor for a company’s success. Google started strong, but its growth took over and the company was in dire need of professional management to make it profitable. Hawkings on the other hand, knew how to market a product at the rapidly growing tech giant Apple.
In an interview with Edge in 2012, marking EA’s 30 year anniversary we can learn a lot about the founding days. Trip elaborated that Steve Jobs influenced his role in EA in good and bad ways. It won’t come as a surprise that he experienced Steve Jobs as a cruel person, especially for those he treated ‘lovingly’, but ‘with a lot of the rank and file people, he would literally take them apart. He could be really cruel.’, according to Trip Hawkins. Trip took over the strong leadership style from Jobs. But where Steve Jobs had its good sides, Trip mentioned that, ‘Steve operates as long as you’re loyal to his mission, he’s going to be friends.’
Trip Hawkins notes that he and his team pitched different ideas around and if it was commercially viable enough they wanted to bring the product to completion. It’s interesting to read that sports games were still an important part of the EA DNA in its early days, but there was enough room for creativity to create games such as ‘Budge’s Pinball Construction Set’. Trip was proud of how EA turned out over the years, with its creative projects and ‘reverse-engineer’ the Sega Genesis.
One of the most important passages in the interview reveals how the company went from a creative powerhouse to a corporation with investors in mind. You see, 2019 wasn’t the first time EA got labeled as the worst company in the U.S. It was already nominated as the worst company 7 years prior, in 2012. Pay close attention to what Trip had to say about this development, ‘Obviously the company went through a transformation where we started out really focusing on art and artists.’,going on to say, ‘I had a different idea about the culture of the company and the vision. Obviously that got lost over time.’, ending with, ‘I don’t think they really noticed or cared because they’re making plenty of money.’
This small sum-up of how Trip looked at the nomination of EA being the worst company of 2012, shows that money clouded the judgment of its senior executives. Moving from creativity to quantity. Money was to be made with established franchises. Obviously, there’s nothing wrong with turning a profit, it’s a commercial company and has no philanthropic mission as much as the gaming community wants you to believe it. But it becomes a problem when this turns into greed and parasitic behavior.
The nomination for worst company of the year happened during the reign of John Riccitiello, who was the CEO of EA from 2007 to 2013. Riccitiello stepped down as CEO when EA was in a PR nightmare, caught in a tornado of negativity. EA, who released Mass Effect 3 developed by Bioware in 2013 and which was blanketed under a sea of criticism about the stories ending. Fans were so upset with the franchise, they started an online petition to remake the underwhelming ending of the trilogy. It even got its own hashtag called #RetakeMassEffect. And you know you are in brand disaster when mainstream media such as USA Today are reporting on the issue.
A new installment of the popular game franchise SimCity, released in the same year as Mass Effect 3, got a rocky start as well. We’ll come to BioWare itself later. SimCity sparked controversy for its always online requirement, making the game unplayable when having no internet connection. Or when the EA servers are down. And that’s exactly what happened. The servers were down. All the people who bought a copy at its release and wanted to play, were unable to. For features that don’t require an online connection. SimCity wrote itself off through its own mechanics.
The fall of BioWare
Large companies that buy smaller companies are nothing new. Tech giants such as Apple and Google buy up smaller companies to develop their product portfolio and ensure market dominance. The game industry is no exception. EA, unfortunately, has built up a bad reputation with its different acquisitions. BioWare is one of the most notable stories of a creative studio brought down by corporate governance.
EA acquired BioWare for $860 million in 2007, becoming the owner of successful game franchises such as Jade Empire, Dragon Age and its most successful one Mass Effect. Years later it became clear this merger was detrimental for the former creators of the studio Greg Zeschuk and Ray Muzyka, who both left in 2012, a major creative brain drain. Trent Oster, part one of the founders of BioWare, said that the backlash of Mass Effect 3 and Star Wars the Old Republic became too much for the duo, saying, “You have to love games and you put your heart into them to create them. To have the fans creating petitions against the work is pretty hard to take” and “I’m sure the internal culture at EA had pinned the Old Republic conversion to free to play as a failure and hung that completely on Ray”. While these are his words, it fits in the picture of EA’s quest for profit that brings down those who pour their heart and soul into their creations.
BioWare wasn’t the only one that lost some of its key members. In 2015 vice president and creative director of Criterion Games Alex ward and studio director Fiona Sperry left the studio. Criterion was a smaller player, but it had a loyal fan base which was left disappointed by this move.
Star Wars Battlefront: a precursor of what’s to come
Star Wars is one of the hottest franchises in the entertainment industry. It has a lot of lore and room for a lot of side stories. What it also has, is a loyal fan base. The Star Wars subreddit has over 1.5 million subscribers at the time of writing, which says a lot about how massive of a following the franchise has. The fans are passionate about their franchise and want to make sure it stays true to the source material. But when it falls into the wrong hands, it can turn into a dumpster fire.
Star Wars Battlefront II marked a new low for the franchise. During its preview through EA Access, it sparked the necessary controversy as it would take users about 40 hours of gaming to unlock their favorite characters such as Luke Skywalker or Darth Vader. Gamespot, chatting about the different loot crates and the several ingame currencies, criticized the loot crate mechanics, or in their own words, “it’s a very heavehandend lootcrate system that will affect your play.” The issue sparked so much outrage, that EA removed the microtransaction. Temporarily.
EA games can spin the story of these microtransactions in many directions. Like they’ve attempted in their own statement, with claims like, “Our goal has always been to create the best possible game for all of you – devoted Star Wars fans and game players alike.” and, “We hear you loud and clear, so we’re turning off all in-game purchases. We will now spend more time listening, adjusting, balancing and tuning.” The latter sentence is an important one, because it didn’t spark any change.
When lootboxes turn into gambling
If the Star Wars franchise taught us anything, it was that they were here to stay. The Loot Box scandal which still plays today, is highly likely the peak of bad publicity for EA and the embodiment of corporate greed. The company is a place where lust for profits turned into an unquenchable thirst for more.
Valve, Blizzard and 2K games complied by removing the sale of loot boxes, but EA refused
Non-gaming readers might wonder what loot boxes or loot crates are, but the mechanics are pretty straightforward and comparable to a slot machine with different types of prizes. Ranging from in-game currency, a new weapon, new characters, and so on, as we’ve seen with Star Wars. This might sound trivial to the average adult, but in a kid’s mind, this is pure gold. You can play with your favorite football star and show him off during an online match. Go for another gamble and get a limited edition t-shirt. You get the drift, it’s basically gambling only you don’t receive money. But they do cost real money and you don’t get any tangible currency back. Which makes this whole ordeal even sadder.
In Europe the lootboxes affair was turning into a government plaything. Brussels started an investigation into EA in September 2018 as it refused to remove lootboxes, or card packs, from FIFA 18 and 19. The Belgian gambling commission considered loot boxes as a form of gambling, as it is purchased with real-life currency. Valve, Blizzard, and 2K games complied by removing the sale of loot boxes, but EA refused with a less than stellar response. CEO Andrew Wilson, responded by defending the loot boxes saying they are not a form of gambling because players know exactly how many objects they are receiving. What items, nobody knows.
In 2019 we were treated to a spectacle of bad PR and inadequate media training with the vice president of legal and government affairs at EA, Kelly Hopkins speaking at the House of Commons, where she called loot boxes “Surprise mechanics”. And the press and crowd went wild. Websites such as Ars Technica, BBC News and Forbes picked up on the newly coined term.
Looking at all the responses EA has given to protect its lootboxes, you might think what the big fuss is all about. But the answer is pretty simple. Lootboxes are a cash cow and it’s a market expected to grow to $50 billion globally annually. According to Cowen analyst Doug Creutz, EA makes about 30% of its revenue from loot boxes, Activision Blizzard 18% and Take-Two approxitately 11%. That’s a revenue stream you don’t want to give up. You’ll protect it at all costs.
Cleaning up the mess
You might feel I’ve been overly harsh with EA, that I’ve highlighted only the negatives, but that was the point of this piece. Pretending to listen won’t help and destroying much-loved franchises will only work against you. Creative products that move in the realm of the abstract, have more emotional value than the actual value.
There’s also a lesson to be learned for every marketer and PR-person, because transparency is key to keep the trust of your customers, preventing it from spiraling out of control, because bad reputation is one of the hardest fixes any marketer will face in their career. You don’t have to play the philanthropic route, I get that. But a strong online community can quickly turn the masses against you and with bad arguments, shrouding true intentions in false claims and statements, can only amplify the effect. Sometimes it’s better to let the fire burn a little of its fuel to cool down and then take the stage to extinguish it.
From an outside perspective, it’s easy to criticize the actions EA has taken. But rightfully so. A lot can be attributed to mismanagement, which happens easily through mergers and acquisitions, where different cultures intermingle. More often than not, it can turn into a nasty cocktail. So could EA have handled all its missteps differently?
I believe one of the most important aspects of entertainment studios is the creative minds that fill them. Giving them space they need to grow and work on their ideas. I won’t deny that a healthy dose of planning is needed to move the ideas in the right direction, funneling them into thought patterns that lead to commercially viable products.
I also detect some misalignment between marketing and technology, especially during the SimCity debacle where the sales shattered the server capacity. Selling a product is one thing, but keeping it operational to the user is another ball game. Those elements need to be in sync to deliver the best customer experience. It’s easy to forget that a customer is actually going to use the product you’re selling when your own target is solely based on generating sales.