Updated from 12:01 a.m. EDTElectronic Arts ( ERTS) is teaming up with Steven Spielberg to develop original video games, the game-publishing giant plans to announce later Friday. Spielberg will collaborate with EA on the development of three titles under the deal. Although EA will own the intellectual property underlying the games, Spielberg will have the exclusive right to develop movies or television shows based on the titles. Shares of EA moved higher in early Friday trading, up $2.37, or 4.5%, to $54.77. Company officials had no time line for when the games would appear on store shelves, but noted that the typical development time required for similar projects was 18 months to two years. EA made the deal with Spielberg, director of hit movies ranging from Jaws to Saving Private Ryan, to help broaden the appeal of its games and to help develop game structure, said Neil Young, general manager of EA's Los Angeles studio, which is working directly with Spielberg. "We haven't been able to deliver on the full promise of the medium," said Young. "What we're phenomenal at is building games, game design. What we're not great at is the narrative. ... We think
EA's deal is with Spielberg, not Spielberg's DreamWorks ( DWA) studio, Young said. EA declined to give the financial details of the arrangement with the director, who will have an office in the Los Angeles studio. But Young said Spielberg will "participate in the success" of the games he helps develop, while EA also should see upside if the games are turned into movies or television shows. The agreement is something of a return to roots for E.A.'s Los Angeles studio. The studio began its life as DreamWorks Interactive division. In collaboration with Spielberg, the studio developed the Medal of Honor series, which has become a hit. EA acquired DreamWorks Interactive from DreamWorks and Microsoft ( MSFT) in February 2000.