EA Sports buying everything

[Dooby]

Not too long ago, EA bought hte exclusive licensing rights to the NFL for video games; it tried to do the same thing with the NBA. Now, EA has bought the licensing rights to ESPN...

Electronic Arts, ESPN sign 15-year deal

01:41 PM CST on Tuesday, January 18, 2005


Associated Press



SAN JOSE, Calif. – Electronic Arts Inc. has signed a 15-year deal with ESPN, giving the video game publishing giant exclusive rights to use the sports network's brand and content in games.

The deal, announced Monday, will solidify Electronic Arts' dominance in sports-related video games and help counter attacks from rivals. It commences in 2006 after ESPN's deals with Sega Sammy Holdings and Take-Two Interactive Software Inc. ends.

Financial terms were not disclosed, but sources close to the deal told the New York Times and Wall Street Journal Electronic Arts will pay at least $750 million.

Though some Wall Street analysts doubt the payout was that really that large, they say the deal is one of the longest-running exclusive deals of its kind in the video game industry, lasting through at least two generations of game consoles.

"EA is trying to destroy the competition," said Michael Pachter, an analyst with Wedbush Morgan Securities Inc. "They're saying, 'If you mess with us, we're going to get in your face."'

Electronic Arts, the largest video game publisher in the United States, has long cornered the sports game market with its popular franchises, "Madden NFL" and "NFL Street" but recently faced stiffened competition and declining sales.

Sports games from Take-Two and Sega are based on the ESPN brand name. Their latest ESPN NFL title, sold for $20 – less than half of Electronic Arts' premium $50 price tag – and received good gaming reviews.

The challenge forced Electronic Arts in November to cut the prices of some of its sports games, including Madden NFL 2005, NBA Live and NHL 2005 to as low as $30.

Then last month, Electronic Arts scored exclusive licensing deals with the National Football League and its players' association, giving the Redwood City-based company exclusive rights to use NFL teams, stadiums and players in its football video games from 2005 until 2009.

"For the first time in quite a while, the Madden franchise was under siege with a game that scored quite well and was $30 cheaper, so EA responded with force," said P.J. McNealy, analyst with American Technology Research. "They went out and cut the check and made it happen – to shut out Take-Two."

Frank Gibeau, Electronic Arts' senior vice president of marketing, said the agreement could help the company create new game franchises "like poker and X Games."

Take-Two said in a statement that it would continue to publish sports games.

"The ESPN license was principally a branding tool and as such does not have a meaningful impact on game play," the firm said.

Perhaps so, but in an era of video gaming that is getting increasingly more realistic in both game play and graphics, analysts say that it will be tough for Take-Two to market their football video game without the ability to use the NFL team names, players, or stadiums.

"Take-Two could sell a generic version, but it's less appealing to not have the NFL teams and setting," McNealy said.

Shares of Electronic Arts were up 2 percent, at $62.03, in morning trading on the Nasdaq Stock Market.

[AnMan21]

i'd heard from an inside source that there was something big in the works, but i had no idea it was this big.....i would imagine the preseason, post game, and post season segments of the games are going to be killer going forward.

[mavsman55]

Does this mean no more ESPN sports games?

If so, that sucks majorly. ESPN games blow EA Sports out of the water.

[AnMan21]

Originally posted by: mavsman55
Does this mean no more ESPN sports games?

If so, that sucks majorly. ESPN games blow EA Sports out of the water.

Sega and Take-Two were the creators of those games. They no longer have rights to the NFL or ESPN names, so their games will have the same gameplay, but will be all generic names. hopefully EA will expand on the already popular ESPN game abilities - creating the type of franchise mode detail everyone's been waiting for. I'm guessing the price tag will jump back up to $50+.

[sike]

BLACK AND GOLD.. we might bend, BUT WE NEVER FOLD

uhhh?

[Dooby]

The ESPN games' major selling point has been price, which has been nothing more than a 1 year marketing ploy. They didn't touch the games software for the 2004-05 cycle (i.e. the ESPN NFL 2004 is the same game as 2003, except with 2004 roster moves, but no other improvements), intending to totally redesign the games for '05-'06. This is a huge coup for EA Sports. But look for Sega to pair up with Fox Sports, I suppose. Back in the early days of Madden, players were refered to only by number, until EA made a deal with the NFLPA. Such a deal may be possible for Sega. They could refer to teams solely by city and use player names and numbers and just never say "NFL" or "Cowboys" or "Redskins", for example. Still, EA is going to dominate the market.

This may be the death of Sega software. I think most of their developement costs for Football 2005 just went out the window. It wouldn't surprise me if Microsoft acquired them within 3-5 years.

[mavsman55]

Originally posted by: sike

uhhh?

I'm from Pittsburgh.

[mavsman55]

Well, looks like I'm back to spending $50 bucks for a decent sports game now. Way to go EA.

[capitalcity]

NFL2K on the Dreamcast was the shit. Visual Concepts' graphics and gameplay were, IMO, superior.

Sega tried their hardest but tell me how a mom & pop general store is supposed to compete with Wal-Mart.

Tell me again - how exactly is a monopoly is good for the gamer?

[FreshJive]

On the plus side mabye Sega will put everything into thier basketball game. Its the one I care about the most.

[capitalcity]

My brother's take -

[/quote]It's all about bargaining chips and whatnot now. EA is really pissing a lot of people off. By shutting out the competition, they indirectly have caused a profit loss for Nintendo, Sony and MS because there's less football games.

Furthermore, video game football is a sub genre of it's own-- football games are system sellers. With the next generation of systems arriving soon, and with EA holding the only football game in town, EA now has the ability to demand that Nin, Sony and MS lighten or completely remove their licensing fees (permission to play on the systems) because none of them-- not even Nintendo-- would dare have their system release without a licensed NFL game!

In other words, it would seem EA is calling all the shots....

...but not if companies decide to untie against them. EA most likely won't make any demands that are too irrational because all Nin, Sony, and MS would need to do is altogether stonewall EA and ban Madden from their systems. EA can't rake in the dough if Madden only comes out for the PC.

The latest rumors say that Take Two (aka Visual Concepts) is appealing to the MLB and NBA in hopes of grabbing exclusive rights: link

However, I don't see that happening quite as we would like it to. The fact is that Electronic Arts is cash behemoth. Do you have any idea how much a deal like the one with the NFL is probably costing them? Easily upwards of 250 million dollars. They can very easily outbid Sega, so odds are that they're just using Sega in order to try and raise the price for EA.

And of course this all blows big donkey balls, but that's how it is. And now to make up for the major expense, EA is likely to cut corners and continue to charge $60 for their games..... as opposed to 20.

-Austin[/quote]

[capitalcity]

why the hell can't the NFL figure it out?
NBA.com

NBA Inks Deal with Video Game Companies

NEW YORK, March 22, 2005 -- The National Basketball Association today announced new non-exclusive licensing agreements with Electronic Arts Inc. (NASDAQ: ERTS), Take-Two Interactive Software, Inc. (NASDAQ: TTWO), Sony Computer Entertainment America, Midway Games Inc. (NYSE: MWY) and Atari (NASDAQ: ATAR) to continue to develop, publish and distribute NBA video games.

The new multiyear agreements, which begin in October 2005, provide fans with the most comprehensive and diverse video game offering in sports, with titles from multiple publishers. NBA video games will be available to fans in more than 100 countries and on more platforms than ever before, maximizing the reach of NBA video games around the world.

"This is a great day for NBA gamers," said Adam Silver, NBA Entertainment President and Chief Operating Officer. "By partnering with the top developers of sports video games, our fans will be assured a broad and competitive selection of innovative products."

EA, Take-Two, Sony Computer Entertainment America and Midway will each have the rights to use NBA teams and current and retired NBA players in their NBA video game titles. The NBA will also work closely with each licensee to heavily promote the basketball video games with marketing and global branding through the league's various assets including NBA TV and NBA.com.

Electronic Arts Inc.
EA, an NBA licensee since 1991, will continue to publish two NBA video game franchises: NBA LIVE and NBA STREET. The NBA LIVE franchise title, a 5-on-5 simulation game currently celebrating its 10th anniversary with NBA LIVE 2005, will be released on a yearly basis under the EA SPORTS™ brand. NBA STREET, an arcade-style game, will be released every other year under the EA SPORTS BIG™ brand. NBA STREET V3, which debuted in early February, unveils a new PSP™ (PlayStation® Portable) version in April.

EA NBA video games will be available on all leading video game and handheld platforms.

"We look forward to continuing our long-standing partnership with the NBA and delivering the most innovative and entertaining NBA simulation and arcade basketball videogames for years to come," said Jeff Karp Group Vice President of Marketing, Electronic Arts.

Take-Two.
Take-Two, the NBA's newest video game licensee, will publish the NBA 2K franchise through its 2K Sports publishing label and develop the games through its Visual Concepts studio, the highly acclaimed developer of the series since 1999. NBA 2K, a 5-on-5 simulation, will be released on a yearly basis on all leading video game platforms.

"We are extremely pleased with the commitment of the NBA to preserve competition and provide sports fans with choice," said Greg Thomas, president of Visual Concepts. "At the heart of 2K Sports is a passion for innovation and the desire to make the best titles possible. With our proven ability to make outstanding video games and our understanding of the nuances of basketball, we will work to fully leverage current and new video game platforms to provide a gaming experience that rivals what an NBA player experiences on the court."

Sony Computer Entertainment America
Sony Computer Entertainment America, makers of the best selling PlayStation videogame systems, and an NBA licensee since 1994, will publish NBA 2006, a 5-on-5 simulation game which originally debuted in 1995 as NBA SHOOTOUT. NBA 2006 will be available on a yearly basis through the PlayStation family of products, including the new PSP™ (PlayStation® Portable) handheld entertainment system which is scheduled to be unveiled later this month.

"As a platform holder and software developer, we are very pleased with the NBA's decision to create a competitive environment for league licensed basketball games." said Jack Tretton, executive vice president, Sony Computer Entertainment America "Sony Computer Entertainment America has always championed competition and diversity on our platforms and we believe that the new deals with the NBA will lead to better choices for our consumers and that innovation will attract new consumers to the category."

Midway
Midway, an NBA licensee since 1992, has agreed to continue to publish NBA BALLERS™, an arcade-style game which debuted for the first time in 2004. The game is expected to be available every other year on all leading video game platforms.

"This deal will allow Midway to keep delivering innovative and engaging gameplay to gamers and NBA fans," said David F. Zucker, president and CEO, Midway. "We've had a long relationship with the NBA and we look forward to continuing to produce the highest quality games and growing our NBA Ballers franchise."

Atari
Atari, an NBA licensee since 2003, will continue to publish Backyard Basketball™ games which are designed specifically for younger players and feature NBA professionals as kid-sized versions of themselves. The Backyard Basketball series, which originally debuted for the first time on PC in 2003, is also currently available on PlayStation 2 and the Nintendo Game Boy ® Advance.

"We look forward to continuing our relationship with the NBA to create Backyard Basketball games that feature the NBA teams and pros that young gamers look up to," said Wim Stocks, Executive Vice President of Sales and Marketing, Atari, Inc

[bernardos70]

So simple, kudos to the NBA. I'm boycotting EA games, as many others will as well.

[LonestarROB]

Boycott EA all you want but its not entirely their fault. The NFL, afterall, contacted EA first. I look at it as the NFL selling out its fans.

[bernardos70]

I forgot about that bit of info. I'll just boycott EA for not paying employees overtime then!