To millions of football fans, “Fifa” does not refer to the sport’s international governing body, but to their favorite video game.
This connection was formed 30 years ago, when California-based Electronic Arts licensed the name to Zurich-based Fifa. The game is now played by 100 million people worldwide, has become a multi-billion dollar business and is a cultural phenomenon.
Despite the long-term and profitable association, the two parties are in bitter dispute over the value of FIFA Name. David Jackson, senior executive at EA’s soccer brand, told the Financial Times: “We’re not sure we’ll move forward with Fifa as a naming rights partner.
Jackson said “the name FIFA lives in the minds of many young players around the world”, but it has “many and many players. . . We don’t see why that will change in the future.”
In preparation, the company has trademarked “EA Sports FC” across Europe and plans to make a final decision on the name of its football franchise by the end of the year.
The battle highlights the growing tension as some in the sport seek a bigger share from the game’s enormous success.
Mino Raiola, super agent for footballers including Zlatan Ibrahimovic and Paul Pogba, has said hundreds of players want to sue EA over the use of their identities in Fifa. In recent years, Juventus has withdrawn from the game, alongside other Italian clubs such as Roma and Lazio. EA says it has the contractual right to include images of all existing players in its game.
“The economics of the game is amazing,” said Gareth Sutcliffe, from media analytics firm Enders Analysis. But he added that there are only so many battles that EA can choose with the football authorities.
“You don’t want to be in a position where all of a sudden you start deselecting [naming] he said.
Console owners pay up to $70 to buy each new iteration of FIFA released every year, although there are also free-to-play mobile versions. At the end of September, it has 36 million unique “entitlements”, meaning people who are logged in FIFA 21, version of the game was released last October. This compares with 35.3 million at the end of September for FIFA 20.
EA says 27% FIFA 21 players have made “in-game” purchases, such as through “Ultimate Team,” where players spend money to improve their team in order to compete with others online. Analysts reckon Ultimate Team is worth around $1.5 billion a year to EA.
Fifa has tried to capitalize on this to claim a significant boost from the roughly $150 million EA receives per year, according to people familiar with the negotiations, after the game company’s 10-year deal electronic to use this name expires at the end of the FIFA Men’s World Cup in Qatar 2022.
The first sign of the dispute was an open letter released last month by Cam Weber, executive chairman and general manager of EA Sports, which said it was “exploring” a new name.
EA’s Jackson said Weber’s provocative statement was made to show “the future is in our hands”.
The video game company and Fifa held further meetings in Zurich last week, according to people familiar with the discussions, and a renewed naming rights deal is still possible.
But the sticking points still exist. Fifa wants to grant exclusivity that is narrow compared to its name, mainly related to the sale of video games. EA wants more franchise rights, such as selling digital memorabilia as non-fungible tokens and hosting e-sports tournaments.
EA was annoyed by not being consulted on issues such as the push to launch a Biennial Men’s World Cup, a project led by Fifa president Gianni Infantino designed to secure additional revenue for his organization.
Internal research also led EA executives to determine that the company could be better off without Fifa. It already has 300 naming licensing deals to ensure the biggest teams, players and leagues stay in the game for years to come.
This includes agreements with Uefa, European football’s governing body, which runs the Champions League; many top soccer leagues in the country in the world; and Fifpro, the players’ alliance, take over hundreds of top players.
Faced with the biggest potential loss of commercial contracts beyond hosting the Men’s World Cup, Fifa said it was “optimistic and excited about the future in gaming and esports for football, and clearly this needs to be done.” must be a space where more than one party controls all rights”.
For EA, severing ties is a risk. FIFA helped transform it from a small video game publisher into a Fortune 500 company with a market capitalization of approximately $39 billion. The Company does not divide revenue directly related to FIFA, but EA’s annual report says the game is “documenting our business and will continue to be”. The company has spent billions of dollars developing its game, with 1,500 employees dedicated to it.
The United States – which for decades has proven resistant to the allure of football – is FIFAsecond largest market, after the UK.
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EA executives have calculated that it could go without some sort of deal with key soccer teams, believing most gamers are unlikely to give up on the franchise.
Next, the company wants to invest in “volumetric capture,” a system that can capture hundreds of hours of footage from past matches to create even more realistic action. The aim is to simulate how former Brazilian star Pelé dribbles or former England international David Beckham takes free kicks. However, such technology would require a new and expensive round of licensing agreements.
“We’re not naive, things can change,” Jackson said. “But we don’t anticipate major risks as long as we continue to meet our players’ expectations for the entertainment value they get from the products we build.”
