The Impact of EA Sports’ Recent Settlement on the Madden Series

By:  John Fabiano, Ruling Sports Intern (Twitter:  @Fabs5180)

With the release of Madden 2013 this week, video game retailers can expect flocks of gamers showing up to purchase one of the most popular sports game franchises.  Last year, 1.4 million copies of Madden 2012 were sold in the first week alone.  With each copy selling for around $60, Electronic Arts (EA) will have an influx of revenue that will help the company move on from this summer’s $27 million dollar settlement stemming from a price fixing lawsuit brought against the company in 2008.

The class action lawsuit alleged that the Madden series was an illegal monopoly and had driven up the price on the popular video game series.  EA Sports has had an exclusive license agreement with the NFL since 2005.  This license has allowed EA Sports to engender football games using player names, jerseys, and every other detail needed to replicate NFL football in video game form.  The deal halted the production of Madden’s main competition, the NFL 2K series, and effectively blocked any other company from producing an NFL video game. 

In the settlement, consumers who purchased the EA products Madden NFL, NCAA Football, or Arena Football from 2005 on are allowed to collect compensation.  Each game purchased for the Playstation 2, Xbox, or Gamecube systems will net a refund of $6.79, while Playstation 3, Xbox 360, and Wii games carry a refund rate of $1.95 per title. 

Along with the monetary settlement, EA is also restricted from negotiating a exclusive license with the NCAA for a period of five years after their current deal expires in 2014.  There is also a five-year ban restricting EA from signing an exclusive deal with the Arena Football league, but EA Sports has not released an Arena Football game since 2007. 

One of consumers’ main concerns with the exclusive licensing agreement EA Sports has with the NFL is that the company has been able to release new versions of Madden with little improvements.  Madden has such a loyal following that many gamers buy the new version of the game every year.  Is this because they love the Madden franchise, or is it due to the demand for an NFL video game?  Without any substitutions, Madden has always been the easy choice and sales are high year after year.

This year’s initial reviews claim that this is the best version of Madden in years.  This could be due to the fact that the exclusive agreement between the NFL and EA expires in 2013.  Nothing in the settlement restricts the two sides from reaching a new exclusive agreement for the Madden franchise, but if they fail to due so, the door will be opened for competitors to develop a competing NFL video game.  It would be interesting to see how loyal the Madden fan base would be if a new, possibly better, football game were to hit the market.

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1 Comment

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One response to “The Impact of EA Sports’ Recent Settlement on the Madden Series

  1. castercorey

    Thank you for this article. It clears up the gray area I had concerning the NFL licence deal. What’s the point in offering people refunds because it was an illegal move to buy it and not restirct the NFL deal forever. The college deal is still shaky because in 5 years after 2014 they can buy it again. Also lets be real who buys the Arena Football anyway?

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