May 10, 2004 9:45 PM PDT

Electronic Arts embraces Xbox Live

LOS ANGELES--Microsoft announced an agreement Monday with leading games publisher Electronic Arts to support the online gaming service for the company's Xbox video game console.

EA and Microsoft executives declined to give financial details of the new arrangement--announced at a press conference before the E3 game trade show taking place here this week--but said it addressed concerns from both sides.

"Both companies realized this was a priority," said Cameron Ferroni, Microsoft's general manager for Xbox Live. "We continued to hear from the gaming public that they want EA games on Xbox Live, and we knew we had to make that happen."

EA, which runs several extensive online services for PC games, was the one notable holdout among major game publishers when Microsoft launched the Xbox Live service two years ago. EA executives objected to the design and business model for Xbox Live, under which Microsoft handles all networking, billing and other infrastructure tasks and game developers pay a flat fee to make use of the service.

The games maker instead had been a vocal supporter of Sony's do-it-yourself approach for online gaming via its PlayStation 2 console.

EA will initially focus on bringing its popular sports titles online, said Chip Lange, marketing director for EA Sports. "NCAA Football" will arrive in July as the company's first Xbox Live title, followed closely by "Madden NFL," its top-selling pro football game and one of the most lucrative franchises in the video game business.

To underscore the importance of the EA agreement, the companies enlisted boxing great Muhammad Ali--star of EA's "Fight Night" series--and real estate mogul Donald Trump to promote the deal. Trump appeared in a video parody of his television show "The Apprentice," giving Microsoft generally high marks as an online gaming innovator but dinging the software giant for its lackluster attempt at a "Madden" competitor. "'NFL Fever'--give me a break," the tycoon sneered. "Is that the best you can do?"

Microsoft also announced the development of videoconferencing capability for Xbox Live. The service currently supports voice chat while users are playing games and in online lobbies. A planned video camera that will plug into the Xbox will be teamed with enhancements in the Xbox Live service that will allow for video chats with up to five other simultaneous users.

The video service is set to debut later this year in Japan, with North American and European availability yet to be determined.

The company also announced plans to offer downloadable games via Xbox Live. The Xbox Live Arcade will debut later this year and begin with Xbox Live subscribers receiving a free DVD with samples of online-enabled arcade games, such as "Galaxian" and "Dig Dug." Those who want the full game can pay a fee--expected to be around $10--to download it to the Xbox's hard drive.

Microsoft executives said the arcade service, combined with add-ons such as the Xbox karaoke kit introduced last year, should help extend Xbox use to a broader family audience.

Microsoft Vice President J. Allard also touted strong sales for the Xbox, saying the software giant has sold 14 million units of the console to date, putting it well on track to meet goals for cumulative sales of 14.5 million to 16 million units by the end of the company's fiscal year June 30.

 

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