Videogame developer and publisher, Electronic Arts Inc. (ERTS), popularly known as EA, is set to launch a free version of Tetris exclusively for Android smartphones. EA will be launching this hugely popular and one of the most played games in the world in association with Blue Planet Software Inc., the company that manages the exclusive licensing rights to the Tetris brand.
The Android version of Tetris will carry no charges and will have new and enhanced visuals. The new avatar of Tetris will have all the features that fans are accustomed to, and additionally, the features will be more challenging and improved.
Tetris is available in over 50 platforms and played in more than 185 counties and has reached over 132 million paid mobile downloads worldwide.
EA will be introducing the game in a new platform and expects the game to multiply the fan following that Tetris already boasts of. This would be EA’s second game for the Android platform after it launched SCRABBLE Free.
EA’s plans of entering the rapidly growing games market on cell phones and social networks was boosted by the acquisition of PopCap Games. With PopCap games’ exposure to Apple Inc.’s (AAPL) iPhone and iPad as well as Google Inc.’s (GOOG) Android-based platforms, EA can now cater to almost every platform and category of mobile gaming.
EA is targeting a large percentage of revenues from the digital platforms based on its broad array of titles. In the social gaming circuit, which is being dominated by Zynga, EA has made the right moves to gain traction in the segment.
To strengthen its social gaming circuit, EA has launched The Sims Social, the Facebook version of The Sims and it comes after a series of games that are made available for the social networking fans such as Monopoly Millionaires, FIFA Superstars and Scrabble.
We believe Electronic Arts has a strong product pipeline for fiscal 2012 and beyond, which will drive its top-line growth going forward. We believe that the high quality titles, impressive product line, increasing online exposure, social games and diversified portfolio guarantees market share gains over the long term.
Additionally, the strategic acquisitions made by the company in the field of social and casual gaming platforms will reap benefits in the long run.
However, the lower sales and changing customer preferences along with cut throat competition from Activision Blizzard Inc. (ATVI) and Take-Two Interactive Software Inc. (TTWO) may act as headwinds going forward.
We have a Neutral recommendation on Electronic Arts over the long term (for the next 6 to 12 months). Currently, Electronic Arts has a Zacks #2 Rank, which implies a Buy rating in the short term.
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