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Group III
DEVARAJAN K | SHALABH DHANKAR | SONAM BHARGAVA | AMARENDRA KR.GORAI | BHARATH BALAJI | AKSHATA V M | KARTHIKA S| NEELAM | VIGNESHWAR M | AMOY KUMAR DUTTA | KULBHUSHAN SINGH BAGHEL | MAHTAAB KAJLA
Flow of Presentation
Company Brief
Q&A
Group III | Indian Institute of Management, Kozhikode | Management of Technology & Innovation
Electronic Arts
Group III | Indian Institute of Management, Kozhikode | Management of Technology & Innovation
Gaming industry
Console/ PC manufacturing
1. 2. 3. 4. Sony Nintendo Sega Microsoft
Game development
Distribution
1. 2. 3. 4.
Gaming industry
PC market Rapid technology change- every quarter Attractive segment for developers
Group III | Indian Institute of Management, Kozhikode | Management of Technology & Innovation
Brought in online gaming phenomenon Multiplayer online games Massive multi player online games Portal games
Console/ PC manufacturing
Network infrastructure
Game development
Distribution
Opportunities New revenue stream for game developers Ease of penetration into PC based
Challenges Higher upfront investment for game development More complex game engines
gaming market
Increase in number of players(114 million Required dedicated and creative support people by 2006) teams Less than required broadband penetration
Group III | Indian Institute of Management, Kozhikode | Management of Technology & Innovation
Microsoft Developed and provided proprietary network infrastructure favoring closed network Controlled third party game developers
Group III | Indian Institute of Management, Kozhikode | Management of Technology & Innovation
Pre Internet Phase Bargaining Power of Customers Threat of new entrants Bargaining Power of Complementers Competitive Rivalry Within industry Low High No Change
Internet Phase
NA NA
NA NA
Group III | Indian Institute of Management, Kozhikode | Management of Technology & Innovation
Group III | Indian Institute of Management, Kozhikode | Management of Technology & Innovation
Resources Capabilities
Talent Pool Organizational Culture Financial muscle to back development (Exhibit 11) Excellent Management Selecting Right Projects and resource allocation Clamped down on science projects during transition period Effective usage of shelf space Outstanding way of managing inventory levels Worldwide time to market < 2weeks Distribution Network
Operational Excellence
Group III | Indian Institute of Management, Kozhikode | Management of Technology & Innovation
Resources Capabilities
Training and development Knowledge sharing
Marketing Personnel and Skills Focus on Lesser SKUs with more investment per titles Better point of sales promotions
Group III | Indian Institute of Management, Kozhikode | Management of Technology & Innovation
Resources Capabilities
Capability Rare Value contributed to end product High Difficulty in imitation/ substitution Moderate Competitive advantage in short run Yes Competitive advantage in long run Yes
Yes
High
High
Yes
Yes
No
High
Low
Yes
Cant say
Low High
Low High
No Yes
Group III | Indian Institute of Management, Kozhikode | Management of Technology & Innovation
Core Competency
Group III | Indian Institute of Management, Kozhikode | Management of Technology & Innovation
Growth Strategy
Markets
New
Market Development
Diversification
Group III | Indian Institute of Management, Kozhikode | Management of Technology & Innovation
Online Gaming
Attractive: Constant reservoir of players, played indefinitely (no specific endings) Challenges:
Managing content: keep players interested by introducing new content on a regular basis Lifecycle of games extended beyond purchase and launch Reluctance to pay based online games (Initially attracted only hard core gamers); consumer education on pay-for-play gaming, justify the premium by offering attractive content Significant investment in server infrastructure
Group III | Indian Institute of Management, Kozhikode | Management of Technology & Innovation
Projected revenues from online gaming = 114 mn * 16% * $15/month *12 months = $3283 mn Other sources of revenues:
Advertising Less royalties as servers belong to them
Risk of giving competition to console manufactures which forms the major share of EAs revenue
Group III | Indian Institute of Management, Kozhikode | Management of Technology & Innovation
Requirements
Resources
Availability
Possible
Group III | Indian Institute of Management, Kozhikode | Management of Technology & Innovation
Come out with online versions of their most popular games like EA Sports
Group III | Indian Institute of Management, Kozhikode | Management of Technology & Innovation
Competitive Advantage Low Cost Competitive Scope Broad Overall Cost Leadership Higher Cost Differentiation
Narrow
Cost Focus
Differentiation Focus
Group III | Indian Institute of Management, Kozhikode | Management of Technology & Innovation
Business strategy
Differentiation New product and innovation Geographical distribution
Technology requirements
Significant investment in high-availability server infrastructure 24X7 CRM capabilities
Environmental Changes
Emergence of multi-player online, MMOG and portal games
Group III | Indian Institute of Management, Kozhikode | Management of Technology & Innovation
Competitive advantage
Marriage between creative and technical skills
Top talent in the industry Significant effort in training and development Strong culture of knowledge sharing among studios
Marketing Strategy
Word-of-mouth Advertising
Group III | Indian Institute of Management, Kozhikode | Management of Technology & Innovation
Group III | Indian Institute of Management, Kozhikode | Management of Technology & Innovation
Group III | Indian Institute of Management, Kozhikode | Management of Technology & Innovation
Y Y Y
NA
Group III | Indian Institute of Management, Kozhikode | Management of Technology & Innovation
Thank You
Group III | Indian Institute of Management, Kozhikode | Management of Technology & Innovation