EA's Exclusive License with the NFL Set to Expire This Year

Mr. Monopoly Pairs the NFL & EA Together

       In 2005, both the NFL and the NFL Players Association gave video game publisher Electronic Arts an exclusive license to use its players' names and likeness.  The NFL license gives the Madden franchise the teams' names, uniforms and symbols, but the NFLPA's license gives it more than 2,000 real world players.  So how did Electronic Arts obtain this agreement?  Electronic Arts pays the National Football League and NFL Players Association $50 million to be the exclusive video game licensee, and the company pays John Madden an additional $2 million for the rights to his name. This effectively gave Electronic Arts a monopoly on football video games.  Competitors like 2K Studios, whose final NFL game entitled ESPN NFL 2K5 was given a 9.4 out of 10 rating by IGN, were no longer able to produce football games with any official NFL teams, players, or logos.

       This past year, Electronic Arts lost its exclusive licensing rights with the NCAA.  As a result of this, Electronic Arts opted not to produce a NCAA Football game for next year.  NCAA Football 2014 will likely be the final installment in the franchise.  Down the road, this may lead to better quality NCAA Football games from multiple video game publishers, but for now there is a possibility that there may not be a viable NCAA football game for a few years. 

       So is the fate of Electronic Arts' NCAA Football franchise any indicator as to what will happen with their NFL Madden franchise?  Will we see a restoration of competition with, now dead, NFL franchises such as NFL 2K and NFL Gameday?  Or will the NFL & the NFL players' union simply extend their contract with EA?

       The real question here is: How much money is EA willing to pay in order to remain as the one and only NFL video game publisher?

       Let's not kid ourselves, the contract may expire this year, but that doesn't mean it's up for debate as to who will get a new one for several more years to come. EA doesn't sell that many Madden games because they are the best quality NFL simulation games available; rather, they sell because there is no competitors who are legally able to compete.  The sad truth is that Electronic Art's NFL video game monopoly is not likely going away. The "Madden" deal ends this year, but the NFL Players Association representatives have all but promised they'll continue to deal with one company.

       From a business standpoint, Electronic Arts has sold over 100 million copies of Madden games life to date, generating over $4 billion in revenue.   What company wouldn't do everything in their power to keep their cash cow flowing?  As an avid sports gamer myself, I would love to see the revival of the previous NFL franchises.  I think it would benefit the gamer, as all the studios would have to ensure they were putting out a high-quality product.  Sadly, the businessman in me sees the writing on the wall;  Electronic Arts will extend its NFL exclusive license and we'll continue to see new additions of NFL Madden year after year which will amount to nothing but annual roster updates.