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EA pumping $80m in SWTOR?

Ben Parfitt
EA pumping $80m in SWTOR?

The total amount of money EA has so far ploughed into BioWare's still delayed Star Wars: The Old Republic could be near to $100m, according to estimates from a leading US analyst.

As part of EA's deal with rights holder LucasArts, as well as paying a loyalty EA has to fund development, marketing, server and distribution costs.

"Given that the game was in development for over four years, with an estimated 200 full-time developers working on it, we estimate that EA’s investment exceeds $80m," Michael Pachter told investors.

"Fortunately for investors, the company expenses R&D spending, meaning that its revenues on sales of the Star Wars MMO will be pure profit.

"We estimate that EA will cover its direct operating costs and break even at 500,000 subscribers (this is exceedingly conservative, and the actual figure is probably closer to 350,000), meaning that with 1.5m paying subscribers, EA will have 1m profitable subs.

"We estimate that the incremental operating cost for each subscriber above break even is around $5 per month (also quite conservative), so if the revenue split is 33 per cent to LucasArts, EA will be left with $5 per subscriber per month in operating profit. At 1million profitable subscribers over the last six months of its fiscal year, EA should generate $30m in operating profit from subscribers."

The estimate is actually some way short of numbers thrown around last year when an anonymous Mythic developer claimed the project had already cost in the region of $300m.

It was reported earlier this week that the game, though still speculatively on track for a release at some stage in 2011, is looking an increasingly likely candidate for a launch some time in early 2012.

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Tags: ea , lucasarts , bioware , old republic , star wars , cost , money , swtor

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