EA and Fifa’s 30-year-old video game union is on the verge of a name dispute

For millions of football fans, “FIFA” is not the international governing body for sports, but their favorite video game.

This connection was formed 30 years ago when California-based Electronic Arts licensed the name of FIFA, headquartered in Zurich. The game is currently played by 100 million people around the world, making it a multi-billion dollar business and a cultural phenomenon.

Despite a long and informative relationship, both sides are in fierce debate over their value. FIFA name. “I’m not sure if Fifa will move forward as a naming rights partner,” David Jackson, senior executive at EA’s football brand, told the Financial Times.

Jackson said, “Name FIFA I live in the hearts of many young players around the world, “but” there were a lot of players … I don’t know why that will change in the future. ”

In preparation, the company has trademarked the name “EA Sports FC” throughout Europe and will make a final decision on what it calls a football franchise by the end of the year.

The fight highlights heightened tensions, as some parts of the sport are seeking greater share from the game’s great success.

Hundreds of players want to sue EA for their use of identity within, said Mino Raiola, a super agent representing soccer players such as Zlatan Ibrahimovic and Paul Pogba. FIFA. In recent years, Juventus has withdrawn from the game alongside other Italian clubs such as Rome and Lazio. EA has stated that it has a contractual right to include portraits of all players currently in the game.

Paulo Dybala of Juventus
Paulo Dybala of Juventus. Italian club withdraws from “Fifa” game © Isabella Bonotto / AFP via Getty Images

“The economy of the game is great,” said Gareth Sutcliffe of media analyst company Enders Analysis. But he added that EA had only so many fights to choose from in the football body.

“I don’t want to be in a position to suddenly start deselecting. [naming] Arrangement, “he said.

Console owners pay up to $ 70 each time they buy a new iteration FIFA Released annually, there is also a mobile version that you can play for free. At the end of September, there were 36 million unique “qualifications”. This means the person who signed in. FIFA 21, A version of the game released last October.This is compared to 35.3m at the end of September FIFA 20..

27% of EA FIFA 21 Players purchased “in-game” through “Ultimate Team” and others. In this case, gamers spend money to improve their teams to compete with other teams online. Analysts suggest that the Ultimate Team is worth about $ 1.5 billion a year for EA.

According to people familiar with the negotiations, Fifa took advantage of this and sought to demand a significant increase from the approximately $ 150 million it receives each year from EA. The 10-year contract for a video game company that uses this name is the Men’s World Cup in Qatar in 2022.

The first sign of controversy was an open letter released last month by EA Sports Executive President and General Manager Cam Weber, stating that the name change was “under consideration.”

EA’s Jackson said Weber’s provocative statement was issued to show that “the future is in our hands.”

Video game companies and Fifa held another meeting in Zurich last week, leaving the possibility of a new naming rights deal, according to people familiar with the discussion.

However, the commitment remains persistent. FIFA prefers to grant narrower exclusivity than its name, primarily in connection with the sale of video games. EA wants a wide range of franchise rights, including selling digital souvenirs as non-fungible tokens and hosting esports tournaments.

EA was frustrated by the lack of discussions on issues such as promoting the launch of the biennial Men’s World Cup, a project led by FIFA President Gianni Infantino, aimed at increasing the organization’s bottom line. rice field.

After an internal investigation, EA executives determined that without Fifa, the company could be profitable. We already have 300 naming license agreements to help the largest teams, players and leagues stay in the game for the next few years.

This includes dealings with Uefa, the governing body of European football, which runs the Champions League. Many top domestic soccer leagues around the world. And Fifpro, a union of players who hold the rights of hundreds of top players.

Gamers playing FIFA 19 at a gaming industry event in Cologne, Germany in 2018
Gamers playing FIFA 19 at a gaming industry event in Cologne, Germany in 2018 © Kriztian Bocsi / Bloomberg

Faced with the possibility of losing the biggest commercial contract outside of hosting the Men’s World Cup, Fifa said, “We are bullish and excited about the future of football games and esports. This needs to be an occupied space. That’s clear. ” Multiple parties governing all rights. ”

For EA, cutting a tie is a risk. FIFA It helped transform a small video game publisher into a Fortune 500 company with a market capitalization of approximately $ 39 billion.The company does not split directly related revenue FIFAHowever, according to EA’s annual report, the game is “important to our business and will continue to do so.” The company spends billions of dollars developing games and has 1,500 employees dedicated to games.

The United States, which has been proven to be resistant to the appeal of football for decades, FIFAThe second largest market after the UK.

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EA executives considered it unlikely that most gamers would abandon the franchise and calculated that it could proceed without dealing with a significant football group.

The company then wants to invest in “volume capture,” a system that can capture hundreds of hours of footage from past games and create more realistic actions. The goal is to recreate how former Brazilian star Pele dribbled or former England national team David Beckham hit a free kick. However, such technologies require new and costly license agreements.

“We are not naive. Things can change,” Jackson said. “But as long as we continue to meet player expectations regarding the value of entertainment we receive from the products we build, we can’t predict big risks.”

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