Game Companies Earn $5B Annually From DLCs and Add-Ons



/ 8 months ago

Game Companies Earn $5B Annually From DLCs and Add-Ons

If you ever wonder why certain things are the way they are, the most likely reason is because it makes money. That is why game companies are very fond of downloadable content and add-ons, offering piece-meal updates on top of the initial $60 initial game purchase. According to the Wall-Street Journal, DLCs are now worth $5B annually, with one company raking in 1/5th of that pie just on their own.

It is easy to guess who that company is who earned the biggest slice: Electronic Arts. The number projected earnings by the end of 2017 will total $5.21 billion. Last year, the total was $4.78 billion and Electronic Arts earned a whopping $1.2B of that whole, which is 1/4th of the total.

DLCs: Moneymaking Model

It is also easy to see why this model is effective. In the days before DLC, there would be a big gap in developing the initial game and the sequel. Many companies would often take that break but DLCs and add-ons have become very effective tools in keeping the hype for the game going until the sequel arrives. Not only does it serve as a useful marketing tool, it is also very effective as a profit-making scheme.

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The irony is of course, as the Wall Street Journal article points out, that game companies are also the victims of their DLCs success. Some sequel titles never end up living up to the expectation of the original and there really is no point in playing the new title if the old one still has add-ons that extend its shelf life.


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Comments

One Response to “Game Companies Earn $5B Annually From DLCs and Add-Ons”
  1. Ridiculous says:

    Problem is not in the DLC’s/Expansions/Add-on’s, the problem is in the pricing and how they actually do it.
    It would be fine if it was like in 1999 picture having whole set of game and all other stuff comes later that gives simply more with a reasonable price compared to the content of that DLC or whatever. Unlike now when it just half made game and if you want the other half of the game that should have been a full game in the first place, you must pay for it more.

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