NFLPA Explains Position on the Exclusive License

As the NFL and EA approach the final year of the current exclusive contract to produce league licensed video games all eyes will be on whether an extension is reached between the two parties. Considering that extensions to the deal have been reached in February 2008 (for three years) and February 2011 (for one year) news on that could be coming soon.

Assistant Executive Director of External Affairs for the NFLPA, George Atallah, actually addressed the exclusive license in an AMA on Reddit yesterday. Since the exclusive license was signed in 2004 no one representing the league has publicly addressed the frustration that many felt as market options were taken away leaving only Madden. 

Q: George, I wanted to ask you about the madden exclusive license. Do you plan to end this soon? The the 9-yr exclusive license ends this year and the fans are sick and tired of not having a choice of picking a nfl game to play. Madden is becoming stale and the community wants 2k sports to have a chance to make video games again. Nfl 2k5 was the best representation of the nfl to this date…. Please make this happen Mr. Atallah. Thanks for your time

Atallah: We have an agreement with EA and Madden. I have heard some opinions like yours, but honestly, EA is one of our best partners. I know they hear some of your input as well and work to improve the game every year.

Q: Sorry Mr. Atallah, but I will not purchase another ea nfl licensed game until the consumers are ale to have a choice again. The consumers should be in your best interest sir.

Atallah: I’m sorry to hear that. One thing to clarify though, my job and the job of the NFLPA, is to ensure that the players’ interests are top priority. I know that might not be the most popular answer, but it’s our mission.

From the Player’s Association side it’s all about money. From the NFL side it’s about money, control, and image. Unfortunately for those hoping for change all those considerations suffer from the league’s perspective with an open license compared to an exclusive one.

As discussed following the most recent extension the indications are that EA will push for a much more favorable deal this time around and that could explain why no agreement has reached even as expiration begins to near. The other extensions came a year earlier in the process. EA isn’t going to accept the same terms as they did in 2004 and 2008. They had to be credited upwards of $30 million for the year of Madden NFL 12 (strike-threatened at the time) for them to agree to the one year extension. They didn’t want it otherwise under the previous structure.

The NFL has created a situation where EA Sports is their only option if they want to continue the exclusivity they prefer throughout all reaches of their business. EA is well aware that they are in the driver’s seat as no other company would be prepared to take on such a monumental project as building an NFL game and have it out in time to avoid missing a season and meet consumer expectations. It’s a similar conundrum as MLB faced as they reduced terms significantly so that 2K Sports would put out MLB 2K13 – otherwise they would have been left with no representation on the console with the biggest user base in America.

The likelihood still is that an agreement will be reached but with terms far more favorable for EA. The other scenario might be EA deciding to gamble and let the deal expire leaving the NFL in a position where they would have to open up the license and consider making smaller deals with them and potentially other companies. At this point EA may feel that the brand would be unthreatened by competitors after having secured the marketplace for themselves since 2005. They also have the benefit of the incremental development advances that have come over that time while others have been forced to sit things out – leaving them to build essentially from scratch – as the transition to the new generation of consoles approaches.