EA: Industry decline is due to wider economy

As the evidence continues to roll out on the extent of the challenge that 2009 faced the games industry, EA's European publishing boss, Jens Uwe Intat, believes that the evidence clearly points to the wider economic situation finally hitting the industry - as opposed to the industry not living up to the increasingly higher expectations of gamers.

The company, which in the run-up to Christmas regained the number one publisher spot in Europe - pushing Nintendo into second place - hasn't been immune to the ravages of the downturn and continues to reshape its business to reflect a changing business environment.

But Intat points to the financial results from specialist retailers as a clear indication that user spending is more cautious than in 2008, with revenue from new titles falling while the second hand market continues to grow.

"I think it's actually that - finally - the economic situation has caught us to some extent," he told GamesIndustry.biz. "I think you can see that if you look at one trend, which is that second hand games have still been increasing substantially.

"If you look at the financial results of the specialist retailers, they're actually showing a decline on frontline goods, but increases on second hand goods, which I think actually proves the point that people are trying to be particularly cautious with how they spend their money.

"That's hitting us an in industry twice - because it means that people wait longer before buying the next-gen consoles, but also that they buy fewer new games per console."

He also refused to criticise Nintendo for failing to back third party products, explaining that while the Wii manufacturer dominates market share on its own platforms - taking as much as 60 per cent of the pie around in some places - the company does engage in co-marketing when it suits it.

"One of the key explanations is that if you take Nintendo's market share on their own platforms and compare it to the numbers for Sony or Microsoft, you'll see that Nintendo has 40, 50 or even sometimes 60 per cent, in some countries," he revealed.

"For Sony and Microsoft it's usually between 10 and 15 per cent, again, maybe as much as 20 per cent in some countries during some periods when they're launching strong titles. So there's certainly much more third party activity going on for Sony and Microsoft platforms.

"As to the question on whether Nintendo should do more marketing - frankly speaking, whenever we do have an interesting title that isn't directly competing with a Nintendo title they are actually open to co-operation.

"I think in the past they've just been benefiting from the fact that their own software has been very strong, and that when they're promoting their titles they're also at the same time promoting their hardware - which just makes the overall marketing activities, from a financial perspective, much more efficient than for third parties promoting their titles on the Nintendo platforms."

The first part of the exclusive GamesIndustry.biz interview with Dr Jens Uwe Intat is available now.