EA To Get Exclusive NFL Player Rights?

Thanks to GameSpot for its news story reporting that EA may be on the verge of an exclusive contract for NFL football player likenesses. According to the piece, which quotes a Sports Business Journal article: "Electronic Arts is in final negotiations with Players Inc., the NFL Players' Association marketing arm, to exclusively license all NFL player rights for the next four years. The Journal set the price tag of the deal at $250 million each year, which EA would pay Players Inc.; in other words, a literal billion-dollar contract." The story goes on to note: "If that turns out to be the case, no non-EA Sports game could license NFL player likenesses--an almost certainly fatal blow to the Madden series' rivals." Update: 05/19 21:07 GMT by S : It seems the linked article has been retracted: "When contacted by GameSpot, NFLPA executives said that not only was the story false, but The Sports Business Journal has since run a retraction."

Comments

Scary part is that they can afford it

[*weasel]

From what I googled:

Madden 2k3 was the #4 best selling console game in 2003 -- selling 2.6m units for the PS2 alone. (~$130m USD)
Madden 2k2 was the #6 best selling game in 2003 -- selling 1.99m units (~$97m USD)
Madden 2k1 was the #33 best selling console game -- selling a respectable 900k units (~$46m USD)
Madden 2k3 for the XBoX is way down at #76 with 490k units (~$22m USD)
Madden 2k2 for the XBox is clinging to #96 with 411k units (~$19m USD)

So the Madden franchise brought in ~$314m USD in 2003 on the consoles alone. EA also has the NFL Blitz and NFL Street franchises which also require likeness rights' licensing.

Also keep in mind retailers don't typically make much profit (if any) off video game sales. (the publisher/distribution/storefront business is more hackneyed and assinine than film distribution) -- So nearly all of the revenue goes right back to EA, who as we all know, puts very little development money back into its minute incremental gameplay updates for each season. However, it's marketing budget is likely quite sizeable for the industry.

The shocking part of this is that EA can afford this contract. But will it be worth squeezing out their competitors?

Sega NFL 2k3 sold only 600k units (~$16m), and MS Fever 2k2 sold only 500k units (~$25m)
Is a potential increase of $40m worth spending $250m to get?
(granted we don't know what the current fees are for non-exclusive likeness rights -- but I have to assume exclusivity adds more than $40m to the price)

Gamespot reports the article has been retracted

[yoDon]

http://www.gamespot.com/gba/sports/maddennfl2005/n ews_6098784.html