EA Titles to Get Steamy

PC gamers will now be able to buy and download titles from Electronic Arts (Nasdaq: ERTS) via Steam, an online game distribution platform that delivers games straight to the buyer's computer.

EA's putting some of its top-shelf content up for availability on the platform, including titles like "Spore," "Spore Creepy & Cute Parts Pack," "Warhammer Online: Age of Reckoning," "Mass Effect," "Need for Speed Undercover," and "EA Sports FIFA Manager 2009."

In addition, the games are being offered without any type of digital rights management (DRM) protection. In the past, some DRM restrictions on games have led users to cry foul, as was the case when EA released "Spore" with DRM that placed a strict limit on the number of times the game could be loaded into a computer.

Opening the Valve

This is not the first time EA has teamed up with Steam's parent company, Valve Software, creator of "Half-Life." The two gaming companies announced a multi-year deal in July 2005 for EA to distribute Valve's wares.

Before the addition of the EA titles, Steam offered its 15 million users 496 games.

In the coming weeks, more EA titles will be added, including: "Mirror's Edge," "Command & Conquer Red Alert 3," and "Dead Space."

A Dying Market?

The partnership between Valve and EA is too little too late, said Michael Pachter, an analyst at Wedbush Morgan.

"The PC games business is in a state of perpetual decline, and Steam is merely prolonging the inevitable," he told TechNewsWorld.

U.S. PC game sales were US$1.36 billion in 2002, and will be below $750 million this year, Pachter said. Steam probably has less than 10 percent of the market, and EA's games are no more than 20 percent of the total offering.

"So we're talking about peanuts. The PC numbers include sales of ["World of Warcraft"] discs and the two expansion packs, by the way, so eliminating them from the mix, PC game sales are down over 50 percent in six years," he pointed out.

Neither the launch of EA titles on Steam, nor the fact that the DRM has been removed, will make much difference for the PC gaming market, Pachter stated.

"I don't think that PC game downloads will move the needle in the grand scheme of things. Steam will continue to gain market share in a declining market. They'll probably double sales in the next six years, and the market will decline further, so they may end up at 20 percent to 30 percent of the PC games market. Of course, partnering with EA helps them get there, but at the end of the day, this is only a small slice of the $20 billion video game market," he concluded.