Electronic Arts

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Engineers at a New Hampshire based defense contractor, Sanders Associates, developed the first video game. It was created by Ralph Baer who was the manager of equipment design at Sanders Associates. In August 1966 when he came up with the idea of making a game for a television set. In 1967 employee Bill Rusch, assigned to the project, proposed a new game in which the hardwired logic circuit projected a spot flying across the screen. Originally the object of the game was for players to catch the spot with manually controlled dots. Over time, the players' dots evolved into paddles and the game became ping pong. Baer tried to find a buyer for his invention but had trouble finding interested parties. Finally in 1971 he struck a deal with Magnavox to produce the Magnavox Odyssey which was sold in 1972. Unfortunately the product was poorly advertised and extremely overpriced and eventually was forgotten by most people. This event marked the beginning of the video game industry which took another 10 years or so to evolve.

On May 28, 1982 Trip Hawkins new venture Amazin' Software was established with an estimated $200,000 personal investment. Several months later, in December, Hawkins stabilized the company further with 2 million dollars of venture capital from Sequoia Capital guaranteed. Shortly thereafter the company changed its name to Electronic Arts (EA). They took a novel approach at giving credit to its developers which is one of their early trademarks. EA was the first video game publisher to treat its developers like artists in an industry where developers were more likely to be treated like factory workers. EA also shared lavish profits with their developers, which added to their industry appeal.

"Electronic Arts, Inc. engages in the development, publishing, and distribution of interactive software games that are playable by consumers on in-home video game players, personal computers, mobile video game players, the Internet, and worldwide" (www.finance.yahoo.com). They manufacture many different types of games which include adventure, action, role playing, simulations, strategy, and sports. The company has development and production studios situated around San Francisco, Los Angeles, Orlando, Chicago, Vancouver, Montreal, London, and Tokyo. EA develops their games from within the company but they also collaborate with other game developers to produce the software which EA eventually publishes, markets, and distributes. They also offer a free web site which carries four brands of games which include: Pogo, EA Games, EA Sports, and EA Sports Big. Electronic Arts operates with, or uses four different suppliers in the production of their video games. Sony and Nintendo supply the CDs, DVDs, and optical disks on which Electronic Arts furnishes to make video games. There are companies that press the disks and convert them into video games. There is a company that makes and prints the instruction booklets. And finally there is a company that packages and boxes the video games for shipment.

There are around 250 to 300 million video gamers worldwide that play video games frequently and about 100 million infrequent users. The average age of video gamers ranges from 20 to 40 year old range including preteens, teenagers, and young adults. The average age of video gamers is rising due to the amount of teenagers continuing to play throughout their adult years. As a result of this game developers are releasing games with more mature content. The video game industry has grown because of several factors including broader game content, the evolution of the video game consoles, better graphics, and the ability to play games online.

The software segment of the video game industry was highly competitive, characterized by the continuous introduction of new games and updated game titles and the development of new technologies for creating and playing games. The developers of software games ranged from...
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