German Online Games Group Bigpoint Signs Strategic Deal With Electronic Arts

Deal will see Bigpoint distribute games from EA's Free4Play site on its own website, which has 177 million registered users worldwide.

 

COLOGNE, Germany -- German online games group Bigpoint has signed a strategic deal with traditional giant Electronic Arts in what could prove a milestone for the games industry.

The deal will see Bigpoint distribute games from EA's Free4Play site on its own website, which has 177 million registered users worldwide. EA will not take a equity stake in Bigpoint, which is controlled by NBC Universal's investment arm Peacock, GMT Communications and founder Heiko Hubertz.

Hubertz said the EA deal would be the first of several between Bigpoint and traditional producers of console games.

For EA, the deal marks a further move into the high-growth world of Internet gaming. EA jumped into the online world in 2009 with its $300 million plus acquisition of Internet gaming group Playfish. EA boss John Riccitiello has said in five years half of the company's revenue will come from online games.

EA certainly needs a new source of growth. In the nine months to Dec. 31, 2010, the company booked a net loss of $322 million. Over the past five years, EA has seen its market cap shrink from some $17 billion to $6.4 billion.

Compare that to leading online gaming company Zynga, makers of FarmVille and Mafia Wars, which in its latest funding round, was valued at close to $10 billion.

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