Video Game Industry & Electronic Arts

The video game industry is characterized by relatively short shelf life of video games, and continuing advances in technology at the hardware level that make it necessary to update the quality level of software. Typically, games run only on a particular hardware platform, and there can be some animosity if software developers write for more than one platform û for example, if a company supplies titles to Nintendo and Sony.

The video game industry is similar to the movie industry in the way that games are createdùwith actors, producers and scriptsùas well as in the fact that they are an audio-visual experience for the consumer. The two industries are also similar in that they depend on a distribution network that must decide whether to purchase a particular title well before it is actually released; this can represent a significant investment if the title does not do well. Most publishers have a no-return policy in the video game industry, and if patrons do not buy tickets to a particular movie, the theater cannot request its money back from the distributor.

However, the two industries differ in that the movie industry does not have a counterpart to the hardware platform of the video game industry. To some degree, Nintendo and Sony are similar to movie studios, working with different directors, for example. However, a movie produced for Warner Brothers can be shown in any theater, just as a movie produced for Universal

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aff who designs games; instead, it works with independent software developers who are given prominence on EA's packaging and who are able to work for companies other than EA. Because of EA's successful marketing, however, and its relationship with multiple hardware vendors, software developers recognize that they can be successful in working closely with EA. EA changed the way that software development is accomplished in the video game industry. By using third-parties to develop software, EA minimized the risk that it assumed. By maintaining no actually inventory except master diskettes, the company minimized its inventory costs and thus kept itself in a position to realize the maximum profit from its activities. By using outside manufacturing resources, the company also positioned itself to be able to supply large quantities of titles that sold well, and not produce inventory for titles that were not so popular. This gave the company flexibilityùuntil it became closely entwined with Nintendoùthat other software publishers lacked. Nintendo, on the other hand, demanded that it control manufacturing of software, which was contrary to EA's strategy to that point. ADVANTAGES AND DISADVANTAGES OF DEVELOPING HARDWARE AND SOFTWAR
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Some common words found in the essay are:
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Approximate Word count = 1467
Approximate Pages = 6 (250 words per page)

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