The gaming industry is buzzing over the viability of publishers’ in-game money-making practice or so-called micro-transactions.
Wedbush analyst Michael Pachter believes industry behavior will be change following the gaming community blow-back over EA’s aggressive in-game monetization strategy in “Star Wars Battlefront II.”
“I’m quite confident that this debacle will influence EA’s future behavior,” Pachter wrote in an email. “Management will take this seriously, and will endeavor to handle MTX [micro-transactions] more elegantly in the future … I think EA got ahead of itself in presuming that MTX would work equally well in all games.”
EA declined to comment on Pachter’s remarks.
It all started earlier this month. Electronic Arts announced on Nov. 16, a day before the “Star Wars Battlefront II” game’s official launch day, it is temporarily turning off all in-game purchases for the game in response to the negative sentiment from gamers.
“It’s clear that many of you feel there are still challenges in the design. We’ve heard the concerns about potentially giving players unfair advantages. … Sorry we didn’t get this right,” EA wrote in the post.
The company told gamers it will change the micro-transaction model for the game in the future.
Hawaiian state Reps. Chris Lee and Sean Quinlan vowed to take action on Nov. 21 to protect underage kids from EA game’s monetization practices. The politicians called the title a “Star Wars-themed online casino designed to lure kids into an addictive cycle of gambling money for a chance to win game upgrades.”
One Wall Street analyst downplayed investors’ worries over the industry’s micro-transaction business model.
“We suspect market concern over MTX could be greatly exaggerated. We do not believe loot boxes are gambling, and suspect player angst over mangled approaches to MTX will naturally self arrest further game development errors,” Benchmark analyst Mike Hickey wrote in an email. “If you’re going to sell a game as a live service, the core game must prove its value to the player community, you can then add MTX opportunities that are constructive toward the play experience with limited or no resistance from the players.”
Video game stocks drop as Wall Street debates industry future after EA’s monetization ‘debacle’