In an earnings call, Andrew Wilson, EA (Electronic Arts) CEO provided insight on the company’s views on play-to-earn models and cryptocurrencies as being a key part of the future of the gaming industry.
Blockchain and cryptocurrencies, particularly NFTs, have gained a lot of attention in the past few years. The trade and use of decentralized digital currency has especially been in the spotlight during the COVID-19 pandemic.
Will the video game giant be incorporating their usage in upcoming installments of their popular titles? Read on for more of the details of this potentially groundbreaking announcement.
Blockchain, crypto, and NFTs in gaming
Blockchain technology has grown by leaps and bounds since its inception in the late 2000s. The emergence and increasing use of Bitcoin, Ethereum, Solana and other cryptocurrencies in the digital landscape opened the floodgates to wider distribution channels. Video games (particularly online gaming) are just a logical extension of their usage.
Companies that are dedicated to blockchain technology for use in play-to-earn games (aka play2earn) have risen in the late 2010s. Dapper Labs is considered one of the earliest success stories of such. With its CryptoKitties, the company helped established the features associated with gameplay that rewards crypto in the form of NFTs.
Later on, companies such as Sky Mavis (Axie Infinity) and Mythical Games (Blankos Block Party) followed suit. The play-to-earn games developed by these companies have further expanded the mechanics associated with the use of the blockchain technology and rewarding users for playing their games.
While new startups have been the most visible in developing projects and enterprises involving blockchain technology, established video game industry corporations have begun testing the waters as well.
Recently, Ubisoft, one of the biggest companies in the current video game industry, has expressed interest and future plans related to blockchain and play-to-earn gaming. It has gone so far as funding Animoca Brands, one of the leading companies in the present era of blockchain gaming. Although the path the company is taking is still unclear, Ubisoft is clearly looking at the possible profits generated in connecting future games with blockchain technology features.
EA CEO statement
On that note, it appears that Ubisoft is not alone in this eye toward the future of play-to-earn gaming. In an investor talk, EA’s CEO Andrew Wilson expressed key insights into their own potential dipping into the blockchain technology and play-to-earn gaming.
But there is a caveat: the company is non-committal towards how soon such technologies would be incorporated into their gaming titles:
The play-to-earn or the NFT conversation is still really, really early… there’s at some level, a lot of hype about it. I do think it will be an important part of the future of our industry on a go-forward basis. But it’s still early.
The EA CEO continued by adding the company would be considering going beyond mere collectability of such cryptocurrencies as NFTs. Function and utility is also a consideration for the company, moving forward:
As a company, we have been leaders in the creation of digital content that has real collectible value in the embedding of that content as part of live services. What we know about collection over time is the collectability is far more valuable to the collector where the collected item has utility. And I think that in the context of the games that we create and the live services that we offer, collectible digital content is going to play a meaningful part in our future.
This seems rather a vague commitment, but it is likely a prudent position. Blockchain technologies and cryptocurrencies are still mired in controversies.
For one, there is a growing concern about how blockchain technology and decentralized currency with regard to revenues and practical use can be easily abused (as in the case of money laundering and black market dealings).
Another issue that has arisen is how such digital tokens as NFTs are minted, requiring a lot of energy consumption and possibly causing environmental problems in the long term. "Gas fees" required to mint NFTs range from the equivalent of a household's consumption to a small city.
EA is thinking about getting into NFT and blockchain games. https://t.co/FkhMPj5eDC
— PC Gamer (@pcgamer) November 4, 2021
EA Games has a number of IPs in its stable that could certainly apply the play-to-earn and NFT models. Franchise titles such as Apex Legends, Battlefield, and the Sims could easily incorporate the mechanics of collectable digital tokens. But perhaps the most mainstream potential for it can be in a licensed property: FIFA.
Electronic Arts CEO Wilson addresses this potential for FIFA games produced by the company in the following statement:
When we kind of interact with our hundreds of millions of football fans… they want more modalities at play inside the game, which go beyond just straight 11 on 11 football. They want more digital experiences outside the game, esports, NFTs broader sports consumption and they want us to move really, really quickly.
Existing blockchain technology pay-to-earn games already incorporate collectable digital tokens in the form of artwork. NFTs that feature popular FIFA players or historical highlights such as games and events (similar to physical sports cards) would not be out of the question.
EA certainly has the commercial and marketing muscle to make crypto and NFTs an important element in the future of video games. Of course, with the company’s public interest in developing this aspect, its peers and competitors will likely not be far behind. With even streaming giant Netflix putting stock in video games as part of its services, there will be more consumers that will likely be interested in play-to-earn games.
This is especially true with the noteworthy revenues EA has posted during the pandemic, growing from $1.15 billion to $1.82 billion, which still does not have the inclusion of the upcoming Battlefield 2042 launch on November 19, 2021.