Madden 12 News Post

EA/NFL Extend NFL Exclusive License by One Year to 2013

07:10 PM - February 14, 2011 by RaychelSnr

The Sports Business Journal is reporting that the NFL and EA have come to terms on extending the current exclusive deal one more year with the uncertainty surrounding the 2011 NFL Season.

Quote:


	"The NFL has restructured its lucrative licensing and sponsorship contract with Electronic Arts to account for the sport�s uncertain future, significantly reducing the video game maker�s contractual obligations next season but adding a year to the deal, according to several well-placed sources. The contract now runs through 2013. The league is believed to have so far rebuffed pleas for fee reductions from other licensees and sponsors, many of which, like EA, find it difficult planning for the next season under the threat of a work stoppage. The league�s collective-bargaining agreement with the players expires March 4, and the two sides are far apart on reaching a deal. EA, however, is a special case, with its iconic �Madden� video game title. The licensing deal it agreed to with the league in early 2008 is believed to be worth well into nine figures in guarantees and royalties over its original five-year term. That stands as one of the most, if not the most lucrative non-TV contract the NFL enjoys. The NFL Players Association, which signed a companion EA deal for rights to the players, reaps regularly between $30 million and $40 million annually, according to the union�s annual filings with the Labor Department. The league deal allows EA to use team colors, names and logos."

This basically means that EA has exclusive rights to Madden now until after Madden NFL 14 -- or roughly right about the time the next generation of consoles are set to hit.

This just shows how strong of business partners the NFL and EA Sports are at this point. The NFL is giving EA a break on payments this year and has basically given them an additional year as a make-up of sorts to make right. Also, if you read my 2011 Predictions Post back in January, you saw this was my first prediction, that the deal would be extended in some way this year.

So in that respect, this news is not unexpected -- and with the deal stretching into the next console generation, I have serious doubts any other company is going to be in a position enter the market anytime soon due to the extreme cost of entry into quality sports game development that will be present at that time.

Thanks to Pasta Padre for the news tip.

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Member Comments

# 381 kehlis @ 02/17/11 07:10 PM

Quote:

Originally Posted by EddieV


	This is the same guy who's constantly putting down 2k5 and BB. Makes me wonder.

Drop the personal attacks and stop being hypocritical.

You are defending your view point like your job depends on it yet find it hysterical that someone else is defending the opposing viewpoint to the same lengths?

# 382 ryan36 @ 02/17/11 07:26 PM

Quote:

Originally Posted by kehlis


	Drop the personal attacks and stop being hypocritical. You are defending your view point like your job depends on it yet find it hysterical that someone else is defending the opposing viewpoint to the same lengths?

Kehlis is here, ...it's safe to post!

EVERY year people say "this is the end for Madden/exclusive license" , EVERY year people argue. EVERY year, Madden survives.

All the hope in the world ain't gonna change that. I would LOVE to go back to 2 or 3 or 4 games in every sport. I'd probably buy them. But it's not happening

# 383 mestevo @ 02/17/11 08:56 PM

Quote:

Originally Posted by RememberMe12


	What I want to know is how many people would actually buy Madden if Madden didnt have the exclusive license and another company did? The majority of buyers purchase it because they can play as "Aaron Rodgers" or "Clay Matthews", not because of how stagnant the gameplay is or how bare the franchise mode is. Sad but true.

I'd consider buying any game that is complete, real info or not. A couple threads in Football Other forum have touched on this topic. I play to build my team in Madden and would play a lot more of the other sports games doing the same thing if I understood them better.

Sent from my Droid using Tapatalk

# 384 CYST2000 @ 02/17/11 09:34 PM

Quote:

Originally Posted by Giants4Natic


	It is not a sign, they have a 5 yr deal. What this does is extend the contraxct one year to make up for a possible lost year. In 2013 they will talk about an extension which if EA wants they will get The sales have to dip way more then it has recently for that to not happen

Sales have slipped in a very bad way, plus the one year extension is a way of telling the developers to get the game in the right direction, or else. And If EA wanted a 5 year extension, then they would have signed on that dotted line when the opportunity was given. Like I said, this shows some hesitation on EA's part. The exclusive rights don't mean that much if they can't make the money they once did when the game was a non-exclusive. I rest my case.

# 385 droopizzle34 @ 02/17/11 09:46 PM

Quote:

Originally Posted by RememberMe12


	What I want to know is how many people would actually buy Madden if Madden didnt have the exclusive license and another company did? The majority of buyers purchase it because they can play as "Aaron Rodgers" or "Clay Matthews", not because of how stagnant the gameplay is or how bare the franchise mode is. Sad but true.

i would probably buy/rent every game if there was choice,see which one is the best and second best and keep those two. i remember back in the day I had madden,2K,and NFL Fever just because they had things the others did not...oh those were the days!

This to me is not going anywhere,the NFL likes exclusive things but they don't realize how bad the exclusive video game license is killing us,THE CONSUMER. Man I just wish that if we gonna be stuck with one game, it be the best game...and after 7 years,I'm still waiting...with no hope in sight...

# 386 ryan36 @ 02/18/11 02:03 AM

Stop comparing the games guys, this is the madden forum

# 387 Tchonz70 @ 02/18/11 03:08 AM

I'm not particually too happy about this either. I do remain skeptical and optimistic. Though I as well as everybody else have some serious doubt about this; here is the way I look at it and maybe I am right (I doubt it!)

Im hoping that it is a possibility that EA is pulling out all the stops. We as well as EA knew that they held an exclusive long term contract over a long period of time. With that being said, I believe that they were comfortable sitting on their hands and being able to do very little necessary and they weren't in serious jeopardy of losing their rights (until now, now that the contract was about to expire). I believe that there is a real possibilty that EA is going to give everything they have to make this the best possible game ever made. I believe they revealed ther plans to the NFL and the NFL was willing to roll the dice with a 1 year extension to see how well the game was made (as well as how consumers like 2012's product and how much drastically will the sales rise-Because the $ is what it all about). I don't think the NFL is stupid and knows this and that is why they only agreed to 1 year contract or else they would have just simply signed them to another long term contract.

However, If I predicted this right-I must give you a warning. If EA manages to sign a long term extension, expect the same thing Nothing significant hasn't really changed since 2007. So 2012 may be a great year but if they were to sign a 5 year Contract don't expect anything to change until 2018 as their liscense would be again in jeopardy just like it is now.

# 388 droopizzle34 @ 02/18/11 04:06 AM

Quote:

Originally Posted by Tchonz70


	I'm not particually too happy about this either. I do remain skeptical and optimistic. Though I as well as everybody else have some serious doubt about this; here is the way I look at it and maybe I am right (I doubt it!) Im hoping that it is a possibility that EA is pulling out all the stops. We as well as EA knew that they held an exclusive long term contract over a long period of time. With that being said, I believe that they were comfortable sitting on their hands and being able to do very little necessary and they weren't in serious jeopardy of losing their rights (until now, now that the contract was about to expire). I believe that there is a real possibilty that EA is going to give everything they have to make this the best possible game ever made. I believe they revealed ther plans to the NFL and the NFL was willing to roll the dice with a 1 year extension to see how well the game was made (as well as how consumers like 2012's product and how much drastically will the sales rise-Because the $ is what it all about). I don't think the NFL is stupid and knows this and that is why they only agreed to 1 year contract or else they would have just simply signed them to another long term contract. However, If I predicted this right-I must give you a warning. If EA manages to sign a long term extension, expect the same thing Nothing significant hasn't really changed since 2007. So 2012 may be a great year but if they were to sign a 5 year Contract don't expect anything to change until 2018 as their liscense would be again in jeopardy just like it is now.

The NFL is happy with EA. That is why they always go to EA with an extension instead of opening up bidding. And I bet they re-negotiate again in 2013. I see no hope in sight,all we can hope for is EA to finally deliver a complete game....good luck with that hope...

# 389 Only1LT @ 02/18/11 10:30 AM

Quote:

Originally Posted by roadman


	Hate to rain on your parade, here. C,mon, you need to look at all the revenues streaming in, not just a slice of the pie. 1st, the difference is 1.6 million units. 6.96-5.36=1.6 million units. The added revenue of MUT, DLC and and facebook sales. Add it all together with the numbers not lying, and Madden could be in the black. We don't know because we don't know the variables of MUT, DLC and Facebook. I do know that MUT was very profitable for them.

Even if they are making enough money from the online extras, that doesn't mean that a sharp decline in sales isn't a huge cause for concern. If sales trend downward then the money made from online extras will also decrease.

If iPhone sales went down drastically, but the amount of money spent in the App Store increased to the point that they still broke even, or even scratched out a profit, do you think Jobs would be happy? Eventually current users will curb their online purchases. Without new customers to make new purchases, the well dries up.

I understand the point that you are making, and I'm not saying that the numbers, what ever they are because you can't really trust VGchartz, you certainly can't trust EA, are currently, or even will be, drastically down, but if they are, regardless of what they did with MUT et al, that is a huge concern.

You can't buy MUT without having the game. Without games sales, there are no MUT sales. The game sales will always be exponentially more important than the DLC.

Activision stands to sell a lot of DLC for COD because it's in a ridiculous number of people's hands. But if they didn't sell a single map pack (not possible) it wouldn't make much difference.

If EA is in a situation where they NEED Johnny to buy potential, or what ever the hell it is that they actually sell in that online DLC, just to pay the bills, then that is not a good position for them to be in (not saying that they are, this is just hypothetical). When the online extras are no longer extras, but actually essential to their bottom line, that's what I, as well as EA, would call a problem.

# 390 roadman @ 02/18/11 10:54 AM

Quote:

Originally Posted by Only1LT


	Even if they are making enough money from the online extras, that doesn't mean that a sharp decline in sales isn't a huge cause for concern. If sales trend downward then the money made from online extras will also decrease. If iPhone sales went down drastically, but the amount of money spent in the App Store increased to the point that they still broke even, or even scratched out a profit, do you think Jobs would be happy? Eventually current users will curb their online purchases. Without new customers to make new purchases, the well dries up. I understand the point that you are making, and I'm not saying that the numbers, what ever they are because you can't really trust VGchartz, you certainly can't trust EA, are currently, or even will be, drastically down, but if they are, regardless of what they did with MUT et al, that is a huge concern. You can't buy MUT without having the game. Without games sales, there are no MUT sales. The game sales will always be exponentially more important than the DLC. Activision stands to sell a lot of DLC for COD because it's in a ridiculous number of people's hands. But if they didn't sell a single map pack (not possible) it wouldn't make much difference. If EA is in a situation where they NEED Johnny to buy potential, or what ever the hell it is that they actually sell in that online DLC, just to pay the bills, then that is not a good position for them to be in (not saying that they are, this is just hypothetical). When the online extras are no longer extras, but actually essential to their bottom line, that's what I, as well as EA, would call a problem.

I think even a more logical post that mine(examining all possible revenue streams) is this post.

Looking at just the 360, Madden 10 sold 480,000 copies between week 27 and now. That is the point I was making. You guys are comparing 70+ weeks of Madden 10 sales to 27 weeks of Madden 11 and are dancing around arm in arm praising a 27% drop in sales.

That's not comparing apples to apples in sales, just trying to make something to fit into their equation.

# 391 Only1LT @ 02/18/11 11:33 AM

Quote:

Originally Posted by roadman


	I think even a more logical post that mine(examining all possible revenue streams) is this post. Looking at just the 360, Madden 10 sold 480,000 copies between week 27 and now. That is the point I was making. You guys are comparing 70+ weeks of Madden 10 sales to 27 weeks of Madden 11 and are dancing around arm in arm praising a 27% drop in sales. That's not comparing apples to apples in sales, just trying to make something to fit into their equation.

I agree with this, which is why I said that I wasn't saying that the numbers actually are, or will even be, down when it's all said and done. If I had to take a guess though, I'd say that they will be down. To what extent, I have no idea.

It doesn't really matter though, because until the deal expires, or is revoked, we will still only have one game, regardless of how well or poorly it does. So looking at sales numbers is really an exercise in futility.

Thinking about the consumer is the absolute last thing on anyone's mind at the NFL or EA, so it's ironic how whether EA is or isn't profitable, is the first thing on a lot of consumer's minds.

# 392 cree ross @ 02/18/11 11:56 AM

The new motto is " IT'S NOT FOOTBALL ,IT'S ONLY MADDEN"

# 393 SageInfinite @ 02/18/11 12:04 PM

I would really like to know how Madden would fair off of just the game alone. No NFL teams, no NFL players, just the gameplay and features. I wonder how good EA would feel releasing that game? Personally I think the other top sports games this gen would still be worth playing without their licenses. I'm not so sure about Madden. I haven't played the final version of Madden 11(patch work), so I honestly can't comment, but from what I played before, I don't think it would fair too well.

# 394 mestevo @ 02/18/11 12:27 PM

This is what I didn' have time to do yesterday.

Madden sales are basically flat on HD consoles, and decreased on mobile and Wii, with death of the PS2 and the continued poor performance by PSP platform accounting for a majority overall decline.

The far right 2 columns show sales of Madden 10 week 78 v M11 week 10, and YOY percentage. I am sure many of us would have expected it to be a much smaller number, I am not sure I was expecting the 360 and PS3 to sell 16-18% of their totals between weeks 27 and 78.

Madden 10 sold 1.8m copies between week 27 and now. Certainly can't expect that again due to the PS2/PSP, but the HD consoles were responsible for 780k, little reason to believe Madden 11 won't do similar numbers over the next year.

I am not sure there's much to be unhappy about here aside from probably the Wii numbers declining. This would be more interesting with multiple years probably (as if it isn't already riveting as it is!

)

# 395 Boilerbuzz @ 02/18/11 01:05 PM

Quote:

Originally Posted by Dayman


	Sounds like it's a good moneymaker for both sides. Makes perfect business sense.

Where did you get that from? Do you realize that this started with EA asking for "relief" of the payouts due to the possible lockout. What's not being told is that the request for relief is NOT just related to the lockout. EA is NOT making the money you're implying. But, whatever.

# 396 mestevo @ 02/18/11 01:31 PM

Quote:

Originally Posted by Boilerbuzz


	Where did you get that from? Do you realize that this started with EA asking for "relief" of the payouts due to the possible lockout. What's not being told is that the request for relief is NOT just related to the lockout. EA is NOT making the money you're implying. But, whatever.

You're just asserting a different implication is all, there's little to prove either of you wrong, just different interpretations to deal... often meshed with our own personal biases and/or objectivity/subjectivity on the subject.

As much money as EA spends on marketing, the NFL's games themselves are probably the biggest driver behind Madden (and the ad spots to relevant eyeballs they provide).

That's why they asked for relief, IMO. No games makes it a more difficult ROI to achieve. I am sure their current deal was negotiated with certain market expectations, and one of them was surely 'NFL games are being played'.

# 397 knighthawksfan @ 02/18/11 05:10 PM

Well I am 50/50 right now if I really want to buy madden 12 or not because I am not a huge nfl fan I am more of a college sports guy. So I might just buy ncaa football 12 and call it a day.

# 398 knighthawksfan @ 02/18/11 05:11 PM

Well I am 50/50 right now if I really want to buy madden 12 or not because I am not a huge nfl fan I am more of a college sports guy. So I might just buy ncaa football 12 and call it a day.

# 399 Boilerbuzz @ 02/18/11 06:57 PM

Quote:

Originally Posted by mestevo


	You're just asserting a different implication is all, there's little to prove either of you wrong, just different interpretations to deal... often meshed with our own personal biases and/or objectivity/subjectivity on the subject. As much money as EA spends on marketing, the NFL's games themselves are probably the biggest driver behind Madden (and the ad spots to relevant eyeballs they provide). That's why they asked for relief, IMO. No games makes it a more difficult ROI to achieve. I am sure their current deal was negotiated with certain market expectations, and one of them was surely 'NFL games are being played'.

I don't disagree with what you're saying. I was just saying that the "relief" talks with the NFL and EA has been going on before any talk of the lockout. And that the perception that EA is financially benefiting greatly with the deal is off the mark. Not implying anything beyond that.

# 400 boooey @ 02/18/11 09:32 PM

dam.. first Nokia sells out to Microsoft, and now this even worse bad news.. its been a really bad week.

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