FIFA takes on video game EA Sports in new football rivalry

LONDON – The name “FIFA” can conjure up images of the World Cup and football’s greatest players, such as Pelé, Zinedine Zidane or Lionel Messi. The acronym for the sport’s governing body may also remind some of shameless bribery and corruption.

For many, however, it is the video game that is synonymous with FIFA.

For three decades, the Swiss-based football body has enjoyed a thriving and mutually beneficial relationship with EA Sports. The annual edition of the video game, as well as related products, has brought in billions of dollars and has proven so lucrative that FIFA thinks it can earn even more on its own.

FIFA on Tuesday severed the licensing partnership with Electronic Arts Inc., making FIFA23 the last new EA game with participation from both parties.

They now become adversaries.

EA will continue to make football games with the best players and the biggest teams, they will just be stripped of the FIFA branding and called EA Sports FC instead.

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Confusingly, perhaps, FIFA24 is also set to hit the shelves next year as the football body is determined to push ahead with its own launch.

EA has already started highlighting its advantages over the FIFA game, given that it has the rights to show 19,000 players from over 700 teams in over 30 leagues playing in 100 stadiums. Manchester United, Barcelona and Paris Saint-Germain will always be there, along with their best players.

“It’s the only place where you can have an authentic, famous and fully representative football experience,” David Jackson, VP of Brand for EA SPORTS FIFA, told The Associated Press. “I think there is an element of potential confusion in the market.”

FIFA’s hyperbole is already trying to undermine EA’s marketing by claiming that it is in talks with several rival game companies and plans to enter the metaverse.

“I can assure you,” said FIFA President Gianni Infantino, “that the only true authentic game bearing the FIFA name will be the best available to football players and fans.”

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How this will be achieved is far from clear, although FIFA owns the rights to the world’s greatest football spectacle. The World Cup will disappear from the EA game.

“The name FIFA is the only original world title,” Infantino said. “FIFA 23, FIFA 24, FIFA 25 and FIFA 26, and so on – the constant is the name of FIFA and it will forever remain and remain the best.”

This kind of explosive talk puts pressure on FIFA to deliver on Infantino’s vision of a game that usurps the EA franchise despite being barred from featuring leagues such as the Premier League – and the teams that play there.

“New entrants would face a steep licensing curve to compete with EA,” said Andrew Marok, an analyst covering the digital media sector at investment bank Raymond James.

Football games are big business for EA. The annual report released this week showed revenue of $6.19 billion.

“We’ve just had our biggest year – ever – for EA SPORTS FIFA games,” EA Sports CEO Andrew Wilson told investors on Wednesday, a day after the deal was announced to end. FIFA at the end of the year.

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Much of the revenue comes from the Ultimate Team mode, where customers purchase additional content in EA sports games. This generated $1.623 billion in 2021.

“We have historically derived a significant portion of our net revenue from tied sales of our largest and most popular game, FIFA, whose annualized releases are consistently one of the best-selling games on the market,” EA said. to investors.

Brand loyalty will be key from next year. Will players stick with EA’s renowned product or switch to the FIFA-launched rival?

It’s already a competitive market with eFootball, the former Pro Evolution Soccer game produced by the Japanese firm Konami. This game has a partnership with Manchester United, although the record 20-time English champions will still feature in EA’s game thanks to a Premier League deal.

EA has already warned its investors of the risks to its football games business from its rivals.

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“Any event or circumstance that has a negative impact on our FIFA franchise, such as the quality of products or services, other products that take up a portion of consumers’ expenses and time, delay or cancellation of the launch of a product or service, increased competition for key licenses or real or perceived security risks, could negatively impact our financial results to a disproportionate extent,” EA said in its annual report.

EA should have an advantage over FIFA by retaining its 300 licensed partners, 30 leagues and federations, 700 teams and 19,000 athletes, JPMorgan analyst David Karnovsky said in a client note.

“While it’s hard to think there won’t be at least some impact of the rebranding on sales, the $150 million available in the absence of licensing fees for FIFA provides enough place in marketing to raise awareness of EA Sports FC,” Karnovsky wrote.

Untangling itself from the world of football politics has its advantages for EA. Tensions between regional confederations have led European body UEFA and its South American counterpart CONMEBOL to bypass FIFA to launch their own meeting of champions. The Finalissima debut will see Italy and Argentina meet at Wembley Stadium in London on June 1. It would seem incongruous for EA to promote its FIFA game during the game.

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“What name would you put on a perimeter board at a UEFA-CONMEBOL event? It’s really hard for us to put FIFA there,” said Jackson, EA brand vice president. which used to be a springboard for our brand, and an accelerator of it many years ago, has become less valuable to us over time.”

EA might also have saved the FIFA brand. The fond association with the video game by so many fans outweighed the toxicity of the Sepp Blatter-era organization after sprawling criminal investigations into football corruption were opened in 2015.

“If you ask a young football fan what FIFA is, they are more likely to say a video game than they are the world governing body, but that value lives with us I believe,” Jackson said. “We are the predominant voice in the world of football from an interactive entertainment perspective, and we don’t see a world where that changes.”

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Associated Press writer Michelle Chapman in New York contributed to this report.

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