London (AFP) – The name “FIFA” can bring back images of the World Cup And the greatest footballers, like Pele, Zinedine Zidane or Lionel Messi. The abbreviation of the Sports Management Authority may be reminiscent of some shameful bribery and corruption.
For many, it’s the video game This is synonymous with FIFA.
For three decades, the Swiss-based football authority has enjoyed a prosperous and mutually beneficial relationship with EA Sports. The annual edition of the video game, along with related products, has raised billions of dollars and proved so profitable that FIFA thinks it can achieve more on its own.
FIFA has severed its partnership agreement with Electronic Arts Inc. on Tuesday, making FIFA23 the last new EA game with both sides involved.
They are now opponents.
EA will continue to make soccer games with the best players and the biggest teams, and they will be stripped of the FIFA branding and instead called EA Sports FC.
Confusingly, perhaps, FIFA24 should also be on the shelves next year as the football authority is determined to go ahead with its launch.
EA has already begun to highlight its advantages over FIFA, since it has the right to show 19,000 players from more than 700 teams in more than 30 tournaments playing in 100 stadiums. Manchester United, Barcelona and Paris Saint-Germain will still be present alongside their best players.
“This is the only place where you can have an authentic, iconic and fully representative football experience,” David Jackson, EA SPORTS FIFA Vice President of Brand, told The Associated Press. “I think there is an element of potential confusion in the market.”
FIFA’s exaggeration is already trying to undermine EA’s marketing by claiming that it is in talks with several competing game companies and has plans to enter the metaverse.
FIFA President Gianni Infantino said: “I can assure you that the only real game called FIFA will be the best game available to players and football fans.”
How this will be achieved is far from clear, even though FIFA holds the rights to the biggest football show on Earth. The World Cup will be gone from EA.
“FIFA’s name is the only world title,” Infantino said. “FIFA 23, FIFA 24, FIFA 25, FIFA 26 and so on – constant is the name of FIFA and will be forever and will always be the best.”
This kind of explosive talk pressures FIFA to deliver Infantino’s vision of a game that usurps the EA franchise despite not having the rights to present leagues like the English Premier League – and the teams they play in.
“Newcomers will face a steep licensing curve to compete with EA,” said Andrew Maroc, an analyst who covers the digital media sector at investment bank Raymond James.
Football games are EA’s big business. The annual report released this week showed revenues of $6.19 billion.
“We just had the biggest year – ever – for an EA SPORTS FIFA game,” EA Sports CEO Andrew Wilson told investors Wednesday, a day after announcing the year-end deal was halted by FIFA.
A large portion of the revenue comes from Ultimate Team mode, where customers purchase additional content in EA sports. That generated $1.623 billion in 2021.
“We have historically derived a significant portion of our net revenue from sales related to our largest and most popular game, FIFA, of which annual releases have always been one of the best-selling games on the market,” EA told investors.
Brand loyalty will be a major factor starting next year. Will players stay with the renamed EA product or jump into the FIFA-released contender?
It is already a competitive market with eFootball, the previous Pro Evolution Soccer game produced by Japanese company Konami. This game has a partnership with Manchester United, although the 20-times England champion will still be present in EA’s game through a Premier League agreement.
EA has already warned its investors about the risks to its football business from competitors.
Any events or circumstances that negatively affect our FIFA franchise, such as product or service quality, other products that take up a portion of consumer spending and time, delay or cancellation of the launch of a product or service, increased competition for major licenses, or security risks perceived, could adversely affect our financial results to a disproportionate extent,” EA said in its annual report.
JP Morgan analyst David Karnofsky said in a client note that EA should outperform FIFA by retaining its 300 licensing partners, 30 leagues and associations, 700 teams and 19,000 athletes.
“While it’s hard to believe that there would be at least some impact from the brand’s shift to sales, the $150 million available from no licensing fee for FIFA provides plenty of marketing space to raise awareness about EA Sports FC,” Karnofsky wrote.
Disengaging itself from the world of football politics has benefits for EA. Tensions between the regional confederations have led UEFA and its South American counterpart, CONMEBOL, to circumvent FIFA to start the Champions League. The Finalissima debut will see Italy and Argentina meet at Wembley Stadium in London on 1 June. It would seem inappropriate for EA to promote its FIFA match in a match.
“What name are we going to put on a surround panel at the UEFA-CONMEBOL event? It’s really hard to put FIFA out there,” said Jackson, Vice President of Brand at EA. It has become less valuable to us over time.”
EA may have saved the FIFA brand, too. The sweet association with the video game by many fans has balanced out the toxicity of the Sepp Blatter era organization after the opening of large-scale criminal investigations into football corruption in 2015.
“If you ask a young football fan about FIFA, they are more likely to say video game than they are the world’s governing body, but that value lives on with us, I think,” Jackson said. “We are the dominant voice in the world of football from an interactive entertainment perspective, and we don’t see a world in which that changes.”
Associated Press writer Michelle Chapman in New York contributed to this report.
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