EA Leaps into Free Video Games

Electronic Arts aims to make money online through in-game ads and micro-transactions. Will the radical new business model fly?

Back in 2006, video game giant Electronic Arts (ERTS) faced a tough situation in South Korea, where rampant piracy was killing off retail sales of new titles. So the company experimented with a bold new business model, giving away free online access to its popular FIFA soccer game but charging customers for all sorts of so-called "micro-transactions," such as buying new clothes or performance-enhancing accessories for their avatars at an average of $1.60 a pop.

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