EA’s chief executive, Andrew Wilson, in a message to investors last week stated that he believes NFTs are a part of the future of the gaming industry. In speaking on the topic of the future of the FIFA franchise, Wilson pointed out that all signs suggested that players want greater interactivity and real-world interpenetration in their games going forward. Examples cited of what this may look like included, alongside NFTs, the growing phenomenon of eSports.
Big Name Gaming
EA, or Electronic Arts Inc., is one of the largest video game companies in the world. The organization vies with Activision Blizzard, Ubisoft and Take-Two Interactive for the top spot as the largest and most influential developer for console and PC games alike. EA’s sub-division, EA Sports, exerts a near monopoly over the sporting video game space, benefitting from many lucrative deals with major sporting associations including FIFA, the NFL and the NBA. As of 2021, EA is said to employ just shy of 10,000 people across its various sub-brands and regional offices. As EA represents the very top tier of mainstream gaming, analysts can look at this decision as being indicative of a larger trend in the world of gaming in general.
Boom and Bust
This news will come as a boon to investors and proponents of NFT uptake, a phenomenon that has not been without controversy since they exploded into the limelight over the past 2 years. Numerous sources have warned of the potential of NFTs to go the way of the Dot Com Boom and its accompanying bubble crash and recession of the late 90s, citing strong similarities between the two tech markets. These concerns clearly haven’t fallen on deaf ears with respect to EA, with Wilson cautioning that NFTs are still in a very early stage of development, and that they are presently experiencing a lot of hype, some of which may ultimately prove to be misplaced.
Play to Earn
Wilson states that it is too early to figure out how NFTs would realistically be integrated with its games, but pundits have been pointing to the “play to earn” model being, at present, the most realistic application. Play to earn refers to the notion that players could unlock specific digital items or customization features, that would then grow in true monetary value over time. This is similar to the way limited edition baseball cards accrue value as they grow in scarcity and age. A slew of EA job postings for NFT related roles point to the fact EA may be further ahead in its plans for implementing this model than it’s letting on.
The New Freemium?
This raises questions as to how NFTs will begin to impact the wider gaming industry. Battle lines are already being drawn between platforms and services actively skeptical of the potential impact of blockchain and NFTs on gaming, pointing to the way freemium games on mobile have negatively impacted gameplay for consumers. Leading calls for caution is gaming client Steam, the largest web-store and provider of PC games, who has recently banned NFTs and blockchain games from its services.
Other Markets
In other industries, NFTs have been having a strong impact. The music industry has embraced the concept as a means to recoup funds, citing it as an opportunity to recover some of the revenue and benefits lost with the decline of CD sales. The digital art community is also experiencing an uplift from the rise of NFTs, with a noteworthy example being the fortunes of internet artist Beeple who sold their collection for £50 million as an NFT, catapulting them to the top of the art world’s rich list. That goldrush may show signs of slowing however, as numerous high profile fraud scandals have impacted the nascent NFT art market, such as the case of an over-eager collector who was scammed out of £224k when buying what they thought was an NFT created by street-artist Banksy.
