The Business of Battlefield

Abstract

This case places students in the context of the video game industry, and a competition between the best-selling video game in history (the Call of Duty series) and Electronic Arts’/DICE’s directly competing product, the Battlefield series. The case enables instructors to help students better understand the business side of a segment of the entertainment industry of which many of our students participate.

In the context of a parent and subsidiary organization in the video game industry, the case is intended to better familiarize students with the riskiness and complexities of the video game industry and to help students better understand transfer pricing and “what-if” analysis in the context of the video game industry. Topics that can be discussed in detail or in brief include: transfer pricing, what-if analysis, ROI calculations, product line evaluation, and consolidated financial statements (analysis of parent/subsidiary results). The ultimate decision in the case involves the evaluation of an investment (the purchase of a business).

Keywords: Video game industry, Battlefield, Parent/subsidiary, Return on investment, Transfer pricing, What-if analysis

JEL Classification: M11, L82