Electronic Arts’ (EA) recent partnership with Microsoft is monumental for video game subscriptions. The video game giant recently announced that EA Play, a subscription service that includes a wide collection of EA games, would be available for users on Microsoft-owned platforms.
With this change, players on PC and Xbox are able to browse EA’s catalog. They also have the option to subscribe to EA Play on their own devices— a feature that was once restricted for Microsoft users. This partnership is mutually beneficial for both companies as they look to increase their subscriber base.
Increase in Customer Acquisition for EA
EA’s decision to partner up with Microsoft creates an enormous opportunity to sell EA Play to an entirely new demographic. The deal enables EA to tap into the 100 million subscriber market Xbox Live obtained last year.
Operating within this umbrella has naturally allowed EA to expand their subscription business. EA’s growth is in conjunction with Microsoft’s ability to continue to rise as a software conglomerate, especially when the latter is positioned to reach new highs.
With this deal, Microsoft users now experience easy access to exclusive EA titles, like Star Wars Jedi Fallen Order, Rocket Arena, and Madden ‘20. The mere presence of EA’s store within Microsoft devices poses more potential revenue for the company.
Andrew Wilson, EA’s CEO, says the company has the ability to double its subscriber base from the 6.5 million active users they announced last November.
Microsoft Keeps on Growing While Limiting Churn
Currently, Microsoft is moving to embellish its Cloud Gaming— an online marketplace of games that is revolutionizing the way users can purchase and play online. Creators can use cloud gaming to limit churn by continually modifying and updating their games.
Microsoft’s head of cloud gaming, James Gwertzman, points out that the industry is shifting from viewing games as a ‘service’ vs. as a ‘platform.’ New gaming communities are forming around franchises that update their games often to keep up with consumer demands.
Microsoft’s adoption of EA’s games gives users another reason to spend more time online and renew their monthly subscriptions. With its primary focus being customer retention, the company has made it clear that this partnership with EA is essential for success. Xbox users can now get EA Play with Microsoft’s Game Pass for no additional cost.
A Visionary Partnership in the Subscription Space
Gaming will inevitably continue to evolve in the foreseeable future. “Video game subscriptions will grow at an average rate of 11% per year; reaching over $8 billion in annual revenue in 2023,” according to Juniper Research. Subscription services are becoming the primary focus of the gaming industry. Gaming franchises will continue to look for partnerships that will optimize subscriber acquisition and retention.
The industry will eventually exist on subscription-based marketplaces, allowing users to simplify and improve their gaming experience. EA and Microsoft’s partnerships is a tell-tale sign of how gaming companies will look to grow their revenue. It’s not by telling customers where to be, but by meeting customers where they are.