In a coup that signals its accelerating shift to a freemium model, gaming company EA has conducted a talent raid on Microsoft’s Shanghai office, poaching dozens of its top developers to build a global ecommerce platform that will drive in-game purchases.
Since luring Microsoft development manager Junbo Zhang to its Shanghai office, EA has hired at least 50 developers from Microsoft for its ecommerce division, including some of its most experienced staff, according to multiple sources. The highly respected Zhang had been responsible for overseeing Microsoft’s ecommerce team.
According to a jobs ad on LinkedIn, EA’s new ecommerce team is tasked with developing a platform that will “power hundreds of games played by millions of gamers.” Reached for comment by email, Kristian Segerstrale, EA’s executive vice president for digital, says the platform is a pillar of the company’s digital platform strategy, which will “allow consumers to pay for new content as conveniently as possible, including in-game transactions.”
Segerstrale says the company is looking to grow its Shanghai team, and is also hiring artists and designers.
The hiring spree reflects the growing importance of the free-to-play model, in which consumers get games for free but pay for virtual items to improve the experience. That model was pioneered in China by Shanda, which was soon followed by Giant and Tencent. More recently, Zynga has already proven the model’s success in the US.
As games shift increasingly to mobile, free-to-play is becoming more important to gaming companies, which are finding that consumers are more willing to pay for in-game items than they are to buy apps. EA already has a “Play4Free” portfolio of games – including Need for Speed, FIFA Online, and Battlefield – which it says is modelled on Tencent and Korea’s Nexon. The company’s acquisitions of PopCap and Playfish, says Segerstrale, have accelerated the transition.
“We’ve operated free-to-play businesses for a number of years and it’s one of our fastest growing businesses,” says Segerstrale. “The free-to-play model lowers the barriers to play, gets more people playing, and allows us to provide ongoing exciting updates for our players as well as a broad array of content consumers can choose to pay for. In our last quarter, extra content and free-to–play were up 37 percent from the year before.”
The Zhang-led raid of Microsoft’s Shanghai offices comes six months after EA hired 15-year Microsoft veteran Rajat Taneja to become its CTO. Like Zhang in Shanghai, Taneja had been in charge of Microsoft’s commerce platform. Taneja, who is based at the company’s Redwood City headquarters, is responsible for EA’s global technology decisions and investments.