Why the NFL’s Labor Strife Might Be the Best Thing That Happened to Madden (Kotaku)

[KBLover]

Why does the NFL want just one company making NFL games?

MLB evidently doesn't have just one company making baseball games. There's All Pro and The Show at the minimum (I believe OOTP uses real players/teams by default these days)

So why wouldn't the NFL want more people paying them for right to use NFL images, teams, etc? Wouldn't that mean more money?

I mean if Backbreaker or some other company comes up with a game that does capture the attention of Madden fans and has some sales success - wouldn't the NFL want that company also paying them for rights?

Then if in some fantasy fairy land I came up with a FB game that was awesome - now there's Madden, Backbreaker, and Knuckleball Lover Football. (Hey, KLF!! LOL). Wouldn't NFL want all of us paying them for rights, not just EA? I mean, why not bleed EA and getting money from two other companies?

[roadman]

Quote: Originally Posted by KBLover

Why does the NFL want just one company making NFL games? MLB evidently doesn't have just one company making baseball games. There's All Pro and The Show at the minimum (I believe OOTP uses real players/teams by default these days) So why wouldn't the NFL want more people paying them for right to use NFL images, teams, etc? Wouldn't that mean more money?

No, not at all. The NFL loves exclusives.

EA paid around $400 million for the right for the license. At that time, that was more money than multiple companies vying for the same license. If you look through this thread, there might be a post from an ex-EA employee explaining the breakdown.

Not this thread, but this one.

Post #339.

http://www.operationsports.com/forum...post2042125500

[kjcheezhead]

Quote: Originally Posted by KBLover

Why does the NFL want just one company making NFL games? MLB evidently doesn't have just one company making baseball games. There's All Pro and The Show at the minimum (I believe OOTP uses real players/teams by default these days) So why wouldn't the NFL want more people paying them for right to use NFL images, teams, etc? Wouldn't that mean more money? I mean if Backbreaker or some other company comes up with a game that does capture the attention of Madden fans and has some sales success - wouldn't the NFL want that company also paying them for rights? Then if in some fantasy fairy land I came up with a FB game that was awesome - now there's Madden, Backbreaker, and Knuckleball Lover Football. (Hey, KLF!! LOL). Wouldn't NFL want all of us paying them for rights, not just EA? I mean, why not bleed EA and getting money from two other companies?

With the No Fun League, the number one priority is money over anything else. EA pays more than multiple companies did.

Number two priority is image. The NFL doesn't want the game to be too violent, players to have tattoos or celebrate too much when they return a pick for a td in the Super Bowl ala Nick Collins.

They know full well that there is a fair number of football fans wanting choices in video games. They just don't care. Sucks to love a league that treats their fans this way, but just like the rest of America I love football and the NFL has the best athletes in the game.

[SpeedyMikeWallace]

The NFL doesn't have to give away an exclusive license.

It all started after 2K sold their game for $20, which forced EA to drop their price to $30. Games were $50 at the time. The NFL saw this as some sort of weakening of their brand image, or something like that, so they put up their license for bidding. EA obviously won, but what has ended up happening is (and I'm pretty sure almost everyone foresaw it) they've become lazy. Without competition, they know they can just roll out the game year after year with minor tweaks and new rosters and charge $60 for it. It's why I haven't bought a new one since Madden 09/ Head Coach 09.

The NFL, seeking to protect it's brand, went exclusive. Ironically, that move probably did MORE to harm their brand image, because, now, instead of a few cheap games, they have 1 game that is the butt of many poor quality video game jokes.

I think the NFL would be better off selling their license to 2K, EA, Microsoft Game Studio, and Sony to, once again, create a competitive market. They could put in a condition that the MSRP must remain $59.99 or the contract will be voided. There's no reason why they couldn't maintain $300million for their license, it just will not all come from the same source.

That is, of course, assuming the courts do not find EA and the NFL guilty of price fixing: Judge Allows Madden "Price Fixing" Lawsuit to Proceed

[roadman]

Quote: Originally Posted by SpeedyMikeWallace

The NFL doesn't have to give away an exclusive license. It all started after 2K sold their game for $20, which forced EA to drop their price to $30. Games were $50 at the time. The NFL saw this as some sort of weakening of their brand image, or something like that, so they put up their license for bidding. EA obviously won, but what has ended up happening is (and I'm pretty sure almost everyone foresaw it) they've become lazy. Without competition, they know they can just roll out the game year after year with minor tweaks and new rosters and charge $60 for it. It's why I haven't bought a new one since Madden 09/ Head Coach 09. The NFL, seeking to protect it's brand, went exclusive. Ironically, that move probably did MORE to harm their brand image, because, now, instead of a few cheap games, they have 1 game that is the butt of many poor quality video game jokes. I think the NFL would be better off selling their license to 2K, EA, Microsoft Game Studio, and Sony to, once again, create a competitive market. They could put in a condition that the MSRP must remain $59.99 or the contract will be voided. There's no reason why they couldn't maintain $300million for their license, it just will not all come from the same source. That is, of course, assuming the courts do not find EA and the NFL guilty of price fixing: Judge Allows Madden "Price Fixing" Lawsuit to Proceed

That is all great in theory, but an ex-EA employee posted on here that the NFL made more than double going exclusive vs other football game manufactures contributing with several liscenses.

As we have all seen, the NFL is greedy and their standard business agreements have been mostly exlcusive. Nike, Rebok, Directtv, etc......


It's better for consumers to have competition, but it's more revenue producing for the NFL to go exclusive.

[SpeedyMikeWallace]

In 2005 that may have been the case. 6 years ago, the VG industry wasn't grossing as much as the film industry. In 2-3 years, it will definitely have surpassed it. I find it hard to believe they couldn't make equal to, or more than, $300million in licensing by selling to multiple companies.

If EA wants to spend half a billion on an exclusive license, more power to them. They may not have that option if they're found guilty in that lawsuit, however.

The NFL has "Official" apparel. Redbok, however, is not the only company allowed to make clothing with the teams' logos and players' names on them.

DirecTV isn't similar either. The only thing they're allowed that other carriers are not is bypassing regionalization. Every single cable company, and Dish, are capable of showing NFL games.

[carnalnirvana]

I really dont have a problem with the exclusive deal, it seems the nfl likes the promotion it gets from madden.

i dont believe they are aware of the outrage the community has with the product's percieved quality.

they care about the hits in madden and how it paints the league image. other than that madden could be released with Manning doing KR and they would not be bothered.

it may not be related but look at sony and the show, i dont see a riot to get 2k baseball on the ps3, i am sure 2k fans who have both consoles may miss the opportunity if they favor playing games on their ps3 but if you only have a ps3 you are covered.

i think its EA who has made a mess of this situation with its fanbase, also with a paid for exclusive license they have creative freedom to release whatever they want as long as they follow the fine print.

[LiquorLogic]

Quote: Originally Posted by SpeedyMikeWallace

In 2005 that may have been the case. 6 years ago, the VG industry wasn't grossing as much as the film industry. In 2-3 years, it will definitely have surpassed it. I find it hard to believe they couldn't make equal to, or more than, $300million in licensing by selling to multiple companies. If EA wants to spend half a billion on an exclusive license, more power to them. They may not have that option if they're found guilty in that lawsuit, however. The NFL has "Official" apparel. Redbok, however, is not the only company allowed to make clothing with the teams' logos and players' names on them. DirecTV isn't similar either. The only thing they're allowed that other carriers are not is bypassing regionalization. Every single cable company, and Dish, are capable of showing NFL games.

The NFL won't make more money by selling licenses to multiple publishers because, without exclusivity, publisher's aren't guaranteed the entire market share. It's doubtful that any publisher would agree to pay an upfront fee. Why would they when another publisher, that the NFL also awarded a license to, may garner a lot of sales, thus the company takes a hit financially.

With multiple licenses publishers pay the licensor a percentage of their sales, which is usually around 10 percent.

Reebok is the only company allowed to make jerseys and hats; if you want an NFL jersey or hat, you have to buy it from Reebok. That means that Reebok doesn't have to worry about competition, so prices are higher. If Nike was allowed to make Jerseys and hats simultaneously, Reebok would have to make sure their pricing was competitive.

As for Direct TV, it's true that other companies can show NFL games, but ,as you stated before, they're the only ones that offer every game from every market; if you're a fan of a team but you don't live in that local market, you have to get Direct TV; if you want access to every single NFL game that's not on National TV, you have to purchase NFL Sunday Ticket. Exclusivity places a tremendous value on the license for Sunday Ticket. If you want it, you have to get Direct TV. For that reason, the exclusive license for Sunday Ticket is expensive. It would be a lot cheaper if Comcast, the Dish, and whatever other companies were allowed to offer Sunday Ticket.

The problem that the NFL may have created for themselves is that, at this point and time, EA is the only publisher that can pay for an exclusive license, and is the only company that seems interested in making a football game right now. If there's no one to freeze out, why should EA have to pay a high premium anymore to do so.

In the football video game world, there are no Comasts, Dish Networks, or Time Warners any more; there's only Direct TV (EA).