FIFA, the global governing body for football and California-based Electronic Arts or EA, known for its video games are looking to end the decades-long profitable partnership over the video game FIFA – named after the governing body.
The video game is so immensely popular that people relate the term FIFA to the video game and not to the sports governing body. The game brought in $20 billion in sales over the past two decades for the gaming developer. For FIFA, this is the most valuable commercial arrangement, now worth about $150 million per year. The current 10-year agreement ends with next year’s Qatar World Cup. FIFA is looking at $1+ billion in a renewed licensing deal for a four-year world cup cycle.
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As first reported by NYTimes, the sports governing body would like to have limitations on EA’s exclusivity to the narrow parameters around use in a soccer game. FIFA is also looking for additional revenue streams for the rights it would retain as electronic sports and digital collectibles like NFTs gain ground. The governing body recently launched FIFAe competition structure and consumer brand. The governing body also expects a non-exclusive deal will bring in more revenues in the massively growing gaming industry.
In a letter released on October 7, the video game company said it is exploring the idea of renaming the game and is reviewing the naming rights agreement with FIFA. The company recently registered two trademarks, one in the European Union and the other in Britain, for the phrase EA Sports F.C.
The video gaming company has inked 300 other similar licensing agreements with organizations like UEFA, which runs the Champions League, CONMEBOL Libertadores, Premier League, Bundesliga, LaLiga Santander, etc. While the agreement with FIFA grants it only a right to use the organization’s name and logo and rights to the World Cup.
The company recently renewed its agreement with FIFPro, the global soccer players union. With other licensing agreements in place, the company expects the discontinuation of its relationship with FIFA to have minimal impact.
In a blog post released last week, FIFA said it will adopt a new commercial positioning in gaming and eSports to ensure that it is best placed to make decisions that benefit all football stakeholders. “The relationship and affinity that the gaming and eSports market has developed over time with the FIFA name clearly underscore that football-based gaming and the FIFA name are intrinsically intertwined,” it said. The governing body said it is engaging with various industry players, including developers, investors, and analysts, to build out a long-term view of the gaming, eSports, and interactive entertainment sector.