Peter Moore Vs VG247 - round one

Peter Moore, now president of EA Sports, gives the best interview in games. No question. We were lucky, then, to find him in blustery form in the penthouse of London's Ark last week, where we discussed the following:

• EA layoffs
• How everything went "pear-shaped" in 2008
• The effect of the macro-economy on gaming's sports sector
• How EA Sports Active allows the company to speak to "her"
• Why he'll continue putting out yearly updates to sports games
• How DLC keeps sports games "fresh"
• Why EA Sports Active is "bigger than a game, bigger than a franchise, bigger than a product"
• That EA Sports Active is a "true platform that we can sell expansion packs, sell more peripherals, ultimately get some download on there"
• Why he wants to get your heartbeat on a TV screen
• Why he'd love to bring EA Sports Active to 360 and PS3 but can't
• How he's going to make announcements on EA Sports PC SKUs in the coming months
• That EA Sports is "abandoning the old model of physical media" in relation to PC
• Why the "future is online and connected" for EA Sports on PC
• How EA Sports games on PC are to follow Asian business models
• That GTA was the driving force behind EA's desire for a Take-Two buyout

This is the first half of our conversation. Tomorrow's portion contains the exec's views on the console race, the current hardware cycle and plenty more.

VG247: How's EA Sports treating you?

Peter Moore: Perfectly fine. I live in the greatest city in the world and I get to hang out in the crow's nest in London. We have a great slate of games, as you saw downstairs. Business is OK, which is probably what most people in the world would like to say, but I'm not sure all can. Feeling good about some of the progress we're making about some of the strategies we laid out a while back I think when you and I talked… Have we talked since I've been at EA?

I don't think so.

No, I don't think we have. But certainly I see it captured on your site. It's been a bit of a challenge to get up and running on the Wii. We've got a better online presence. Our quality is up, which we committed to do. So, yeah. Stuff like EA Sports Active is exciting. Brand new. Uncharted water.

Can I ask you a direct question?

Yes, sir.

Have unit sales at EA Sports actually increased since you came on board?

We track revenue.

Has revenue increased?

Probably can't answer that question. Because that would be material, right? [To PR]

PR: Yeah.

How badly was Tiburon hit by lay-offs? It was never actually confirmed.

No, we haven't talked about individual studio layoffs. We've shared the pain. Tiburon, every studio at EA - as, unfortunately, lots of publishers and developers around the world have - had to share the pain of getting costs under control in a market place where you can't predict revenue. We have a plan. We had a plan last year like everyone else did. We were feeling really good in October, but like a lot of companies in this industry and companies everywhere in the world, everything went pear-shaped pretty quickly.

So, Tiburon: no worse or better than anyone else. We had to take some pain. We have a great GM there, Philip Holt, who does a very nice job, so no different than everybody else.

Speaking generally, then, about the macro-economy, to coin the phrase, how badly has the sports segment been hit?

Our biggest challenge is less the macro-economy than the segment itself and where the growth is. The core business is solid, but it's not growing in line with the industry. What's growing, Pat, is more the lifestyle sports, and Wii Fit is a major spearhead of that, so EA Sports Active gives us out best opportunity to start playing in that space. Talking to a brand new consumer that's new to EA Sports. We've never spoke to "her" before. We've built a new organization around that, a marketing organization, bringing in experts into Vancouver where EA Sports Active is developed and I think it's a huge opportunity for us to (a) talk to a new consumer, (b) a brand new platform and business model for the company.

The biggest challenge for us has been the way our segment has grown rather than the macro-economy. Yeah, it's tough when people have only got so much money in their pockets, particularly when you're delivering an annualized game experience. I have to give them a good reason to buy FIFA 10 this year when FIFA 09 was a brilliant game. That's the challenge we have every single year.

Is that sequelization, something that's really endemic in sports, a system that you'd like to break away from?

Not necessarily. When football season starts, when baseball season starts, when basketball season starts, they expect a game from us and we deliver a game. I think what we've got to do is layer on top of that more regular updates, and how do we make the game fresh, and doing it better in some sports than others, but no, as each season starts, as we always have done, we're going to continue to deliver a game. If it's something like a Fight Night or Active, where it's not necessarily seasonal, or golf, where we can do different deliver dates as we're doing this year, then we can look at different cadences of rhythm.

Online gives us a huge opportunity. FIFA Ultimate Team most recently had everyone blowing the dust off their FIFA game and putting it back in because they needed to play online again. And that was a very successful experiment in what we need to do to keep a game fresh.

Talking about EA Sports Active, which is probably your biggest departure from a traditional product, I spoke to Jen [PR demoing the game] about it yesterday, and she very candidly said that it wasn't a game. Is there a slide on your PowerPoint that says "game" one way and "non-game" the other? I mean, is it part of your strategy that you want to have non-game products, or do you just want to be in that sector with Wii Fit?

We need to grow our game business, and I've been very clear over the last 18 months about the expansion of the brand. To expand our core business is important, but growing again and getting after that new consumer… it's not a game. But one thing I told Dave McCarthy [demoing EA Sports Active in the intro demo at the event] was that he'd better smile while he was doing this. And that was the creative brief I gave him. He'll tell you that. He's worked so hard to get this game right. This game has been a labour of love for him and his team. It's exercise with a smile on your face.

But you've got to be able to get this thing right, basically. To your point, it's out of our core competency, and it was not easy to get it going and get it right, then all of a sudden it clicked. And boy, we did a lot of usability, brought a lot of people into the studio, got a lot of feedback from Riccitiello and myself, and David has been a trooper. We've finally got it right, and we're very proud of where we're at right now.

This is a brand new platform. To your question, I call it a platform. Yes, it's a game, but it's bigger than a game, bigger than a franchise, bigger than a product. It's a true platform that we can sell expansion packs, sell more peripherals, ultimately get some download on there. I've got to figure out how to get your biometrics on the screen. If I can do that, if I can get your heart-rate on the screen, I mean then I can really drive towards what my vision of this product ultimately can be.

It's not difficult, but it's not cheap. I mean, you can find heart monitors that give off wirelessly, but I've got to figure out how to get a transceiver, if you will, on the screen. Once we do that I think we've really stepped up.

It's good for the industry that we're doing things, experiences, games, products, whatever you want to call them, that allow us to look and point at something that is do-good. Because over here you suffer from what is probably the most vitriolic press. The Daily Mail always seems to jump up on this stuff and blame [videogames] for pestilence, the plague, everything, and I think it's good that we have things to point to that say, 'This is getting you off the couch' and provide a little bit of balance. It gives us a defensive argument about what we do in our industry.

When are we going to see EA Sports Active on 360 and PS3?

Well, that's a better question for Sony and Microsoft. Right now there's nothing physical in those controllers and they've either got to figure it out or not figure it out. They're very aware of what we're doing and, as you might imagine, they visit us and we show them what we're up to and we say, 'Boy, we wish we could bring it to you, but we can't right now.' Question for them, Pat. We're ready when they are.

I'll ask them.

You ask them.

Going back to your core titles for a second, I want to talk about the PC SKUs on your core games. You very unceremoniously dropped the PC version of Madden last year, to much wailing and gnashing of teeth...

Oh yeah.

...and then said in June '08 that your PC SKUs would be back in '09.

I'll tell you exactly what I said. We've got to look at the PC in a very different what to we are, which is shipping discs in a market that was, unfortunately, just disappearing. And unfortunately the market was going down in sales but going up in costs, as I was supporting people that didn't buy the game but I was supporting online as well as customer service support. As you can imagine, and we've talked about it a little bit with Tiger, we've got to go online with this stuff.

It's not that we're abandoning the PC user, the guy that wants to play sports games on the PC. I've got to look at teams, and I've got to keep people employed and therefore games have to be profitable, otherwise where do I get the money to reinvest in building the games?

Sometimes gamers don't like to hear that, that this is a business, and I always tiptoe around it a little bit, because it's a creative thing, and they think we have an obligation, which we do, to do things creatively, whether it makes money or not.

The sheer truth of it is that it's got to make money because I need the capital the following year to buy more dev kits, to hire more engineers. And you have to make tough choices with business, much more now than two of three years ago, when you could afford to do some things that maybe weren't profitable. And we need to find different business models to go after that consumer again.

You're going to see some announcements in the next few months about how we're going to do that. I get a lot of abuse. You read my blog, I'm sure. "Why can't you tell us? We demand to know!" I tried a few posts ago to explain how the world of announcements works, particularly when you work in my world, where you've got to get approvals from everybody… and until it all comes together, there are certain things we can't say. That's frustrating, I know, for gamers, but they need to understand. There are competitive reasons I can't make announcements on this. There's cannibalization reasons that I don't want to talk about what's coming down the road, because I need to sell you that Coke Zero before I sell you Coke Zero 2.

So, it's challenging. I know we do frustrate a lot of the folks, and you do see some commentary on the blog. But it's not that we're abandoning the PC as a platform for sports gaming. You might say we're abandoning the old model of physical media because we believe the future is online and connected.

You're going to see us take a lot of our learnings from what we're doing with our games in Asia, where I'll give you the game for free, or a certain level for free. And my hope is that you're enjoying it that much that you'll buy things and you'll upsell. And then there's no barrier to entry whatsoever.

I will challenge you on that point a little bit. You did bring out a PC disc version of FIFA last year.

Yeah. FIFA's the one game we can sell on a global basis, and I don't rely on ubiquitous broadband. So, FIFA sales in Eastern Europe, Russia, all around the world are a little easier for me, and it's a little easier to justify - as we have in Vancouver - a PC team to develop it. When I look at the forecast, and the sales we get on PC FIFA globally, it's justifiable as a resource expense to still do it on a physical disc.

Actually, we did the same with NHL, because we had very strong interest for NHL on the PC in Eastern Europe and again in Russia and Scandinavia. Scandinavia's got good broadband, but some of the Eastern European and Russian markets are still struggling a bit to get their infrastructure up and running.

But once the infrastructure's there, then I'd rather deliver it direct to their hard drives, give them a different business model than shipping on a disc.

Talking specifically, is the next PC version of Madden going to be downloadable?

You could say that when we're ready to look at which franchises are going to be more applicable to be playing on the PC, we've said this repeatedly: it's an online-based model. The actual structure of whether it's browser-based, whether I give you a client, whether it's subscription gaming, all of these things are yet to be determined.

There was an awful lot of talk around the time that EA was moving on Take-Two that there was the ulterior motive of Take-Two's sports business.

Well, it never happened, so it's not really worth talking about, is it? And I'm sure I'm still under SEC regulations. I can't talk about it.

Talking hypothetically, then…

[Laughs]

…how much would Take-Two's sports offering have empowered EA Sports?

The real driving force – as Ricittiello said, and he wasn't fibbing – was the attraction of the Grand Theft Auto franchise. That was the driving force. Sports would have been secondary to that.

Part two tomorrow.