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EA Sinks $80 Million into Development

Posted by Suzie Ford on May 10, 2011  | Comments

EA Sinks $80 Million into Development - Star Wars: The Old Republic - MMORPG.com

EA has invested $80 million in the development of Star Wars: The Old Republic. Additional revelations include the fact that LucasArts will score a 30% share of profits after EA recoups its initial investment in the development, licensing, marketing and distribution costs.

"We estimate that EA will cover its direct operating costs and break even at 500,000 subscribers (actual number is closer to 350,000 subscribers), meaning that with 1.5 million paying subscribers, EA will have 1 million profitable subs," said Pachter. "We estimate that the incremental operating cost for each subscriber above break even is around $5 per month, so if the revenue split is 33 percent to LucasArts ($5 per subscriber per month), EA will be left with $5 per subscriber per month in operating profit. At 1 million profitable subscribers over the last six months of its fiscal year, EA should generate $30 million in operating profit from subscribers."

EA also announced this week that the launch of "Star Wars: The Old Republic" may be delayed until January 2012.

Read more about the Star Wars: The Old Republic investment financials.

Thanks to AmazingAvery for the tip!

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Suzie Ford / Suzie is the Associate Editor and News Manager at MMORPG.com. Follow her on Twitter @MMORPGMom