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EA expanding ahead of new consoles

Racing to supply video games for the next generation of consoles, Electronic Arts said it would step up its hiring and investment even after a period of fast and costly growth.
/ Source: Reuters

Racing to supply video games for the next generation of consoles, Electronic Arts Inc., the largest game software publisher, on Wednesday said it would step up its hiring and investment even after a period of fast and costly growth.

Electronic Arts said it plans to offer six titles within a few months of the expected November launch of Microsoft Corp.’s upcoming Xbox 360 game and entertainment system with 25 more games in development.

Asked whether it plans to offer a similar number of games for Sony Corp.’s PlayStation 3 console, EA’s John Schappert, the head of EA’s biggest game studio, said the company can devote an equal amount of resources to the PS3.

Sony has targeted a spring 2006 launch for the next version of its best-selling game machine.

Schappert said his studios in Canada, which create more than half of EA’s games, have nearly tripled their development staff in three years to around 1,700 workers.

“We have an awful lot of those people working on new platforms,” said Schappert, a senior vice president at EA.

“I wish we had 2,000 or 3,000. When we have 3,000, I am sure we will wish we had 5,000.”

EA, the maker of “Madden NFL” and “The Sims”, said it plans to nearly double its capacity next year with a new 170,000 square-foot building in Canada as well as a new motion capturing studio.

“We’re very much in growth mode,” he said.

Electronic Arts said it is making “massive investments” to lay the groundwork in developing games for the Xbox 360 and PS3, which both promise to deliver movie-like realism with powerful new processing technology.

“If you look at the balance sheet and profit and loss numbers, it doesn’t always look that pretty. We’re spending an awful lot of money right now to do all the heavy lifting,” Schappert said.

Earlier this month, EA forecast an unexpected net loss for the current quarter, saying that hardware shortages continued to hamper sales. Analysts also cited large investments for product development as a factor weighing on EA’s outlook.

“It is a challenging time for us,” said Schappert. “But we’re building these games for the next five years not just this one year.”