FIFA And EA To Finally Part Ways From The $20 Billion Empire- Header

FIFA And EA To Finally Part Ways From The $20 Billion Empire

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FIFA is set to part ways with EA. What it means for the video game soccer space?

For over a decade now EA’s FIFA franchise has been singlehandedly dominating the video game soccer space. The FIFA Ultimate Team has been responsible for bringing in millions of dollars revenues.

However, this successful partnership of over two decades, between EA and FIFA is steadily coming to an end, soon. The franchise has brought in over $ 20 billion and FIFA earned $ 150 million, per year, on licensing fee alone. But this partnership is coming to a close as both parties have been unable to come to an agreement about the renegotiation terms.

The Story So Far…

According to an article published in the New York Times, the game sales for the franchise has crossed the $ 20 billion mark, in the past two decades since the first game came out. With a new title coming out on a yearly basis and FIFA earns $ 150 million as annual licensing fee.

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What Went Wrong Between FIFA and EA?

The latest deal between EA and FIFA will be active till the end of the 2022 World Cup that will be held in Qatar. Both parties have been unable to reach a common ground with the renegotiation terms for a new contract. The highlights of the same being as follows:

FIFA, the not for profit organization is the governing body responsible for running the football (soccer) World Cup, wants more money from EA. It wants to charge a fee of over $ 1 billion for each World Cup cycle, each cycle spanning over four years (the interval at which the World Cup happens, four years).

On the other hand, EA wants to use the FIFA name for its new ventures, which include NFT (Non Fungible Tokens) and even video game and esports tournaments.

... The Way Ahead

With both parties at an impasse and not willing to carry this partnership forward, for reasons of their own, the question that now remains to be asked is what now? Here is what we know, so far.

EA Plans To Forge Ahead Alone

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As per reports, EA has already filed for trademarks in Britain as well as in the EU for EA Sports F. C., it almost sounds like a potential new name for a game.

The company currently has more than three hundred licensing agreements. This includes one with UEFA (Union of European Football Association), the governing body of football in Europe. The organization is not only responsible for acting as the umbrella organization of over fifty five national associations but also responsible for conducting the Champions League, a massively popular football league featuring some of the best clubs in the region. Thus, even without the FIFA title, EA will have a stronger position in the video game soccer scene than most of its other competitors.

It is of utmost importance to understand that it is these licenses that allows EA to use the likeness and names of players, playing in the league, such as, Cristiano Ronaldo, Lionel Messi, Kylian Mbappé along with popular clubs such as Real Madrid, Manchester United and many more others.

FIFA Too Plans On Going On Its Separate Way

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On October 15, 2021, FIFA had released a statement on its official website, where it has in very clear and succinct terms states that it is “bullish and optimistic about its long-term future in gaming and eSports following a comprehensive and strategic assessment of the gaming and interactive entertainment market”. It further stated that it was looking to “adopt a new commercial positioning in gaming and eSports to ensure that it is best placed to make decisions that benefit all football stakeholders”.

FIFA also further stated that it was ready to shopping its name. The organization is interested in finding a partner that will be allowing it to tap into the “in game microtransactions”. These transactions had been responsible for bringing in $ 1.6 billion in sales for EA, in the last year alone.

Moreover, it has announced that starting from 2026; it is planning to hold the football World Cup, an event that like the Olympics currently happens every four years, every two years instead of the current four year interval.

This is all we know so far about the current situation between EA and FIFA, a partnership that could very well go down in history as probably one of the most successful partnerships in the history of video games industry. We will be keeping you posted about all the developments in this case, as and when they happen.

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