Analysts Weigh in on Madden's Mega Licensing Fees

February 5, 2009 -

Yesterday, GamePolitics broke the news that Madden publisher Electronic Arts paid the National Football League Players Association more than $35 million in licensing fees during 2007.

We asked a couple of financial gurus to comment on the eye-popping figure, which is buried within a massive document filed by the NFLPA with the U.S. Department of Labor.

Wedbush-Morgan financial analyst Michael Pachter told GP:

The [Madden licensing] deal is likely a guarantee of around $50 million total, and $35 million [going] to the players makes sense. The old deal was around $15 million per year, and I know that it went up substantially when renewed in 2005.
 
[EA sells] around 5.5 million copies a year, so they're burdened with [about] $9/unit in licensing. That's reasonable, on par with the royalty paid to the console manufacturers.

So, Mike, yesterday GP speculated that the league would get at least as much as the NFLPA from EA. Are you saying we were wrong and that the NFLPA actually gets more than the NFL?

Most definitely.

 

The product is the players, and the league used to get most of the money. The reason the royalty went up was the players, not the league. The league looks at the game as a marketing tool, but the players want to be paid for their likenesses.

Meanwhile, analyst Doug Creutz of Cowen and Company termed the $35 million paid by EA to the NFLPA "a gigantic number," adding:

I’d estimate Madden generates $350-400 million in revenue for EA annually.

 


Comments

Re: Analysts Weigh in on Madden's Mega Licensing Fees

Those fees are insanely high.. i dont see how they make it

 

Cookie Stuffing Guide

Re: Analysts Weigh in on Madden's Mega Licensing Fees

Because of the ban on other games on using player likenesses and names, EA has a virtual monopoly on football games.  I like Madden Football, but I'd like to have the choice between competing game designs.  Lack of competition is not good for anyone - it encourages the sort of stagnation that we've seen in EA's sports line-up in the last few years.

Re: Analysts Weigh in on Madden's Mega Licensing Fees

Of course Madden makes that much. What other NFL choice do people have? None, because of these assholes at EA and their exclusive deal!

When Jack Thompson runs his mouth, does anyone really care what he has to say anymore?

Re: Analysts Weigh in on Madden's Mega Licensing Fees

I don't think giving approximately 10% of revenues from Madden to licensing is too big of a chunk for EA to pay.  

www.20sidedwoman.blogspot.com

Re: Analysts Weigh in on Madden's Mega Licensing Fees

Keep at it, take down Madden.  I am sick of that carbon copy game.

Nido Web Flash Tutorials AS2 and AS3 Tutorials for anyone interested.
How to set Xbox 360 Parental Controls

Nido Web Flash Tutorials AS2 and AS3 Tutorials for anyone interested.
How to set Xbox 360 Parental Controls

Re: Analysts Weigh in on Madden's Mega Licensing Fees

Then don't play it? Why are you trying to encurage the prevention of people who ligitimatly like playing the game?

Re: Analysts Weigh in on Madden's Mega Licensing Fees

If they lose the deal, the NFL will likely take some time signing another exclusive deal if they ever do.  I want more developers making NFL games, because I actually enjoyed the fact of developers competing to make a good game every year instead of EA only owning it and doing a roster update.

Nido Web Flash Tutorials AS2 and AS3 Tutorials for anyone interested.
How to set Xbox 360 Parental Controls

Nido Web Flash Tutorials AS2 and AS3 Tutorials for anyone interested.
How to set Xbox 360 Parental Controls

Re: Analysts Weigh in on Madden's Mega Licensing Fees

But there are people who ligitimatly like Madden (crazy I know!). Why do you want to encurage the death of madden, and as a result people who like the game can no longer play it anymore?

Re: Analysts Weigh in on Madden's Mega Licensing Fees

They won't be losing anything, they will always have the last copy EA made, they just have to make the roster update themselves with the create a player. (or with the last version that has that)

Maybe another company will make football games those people like too, but the majority of Madden fans from years past are sick of this recycling of the game.

Nido Web Flash Tutorials AS2 and AS3 Tutorials for anyone interested.
How to set Xbox 360 Parental Controls

Nido Web Flash Tutorials AS2 and AS3 Tutorials for anyone interested.
How to set Xbox 360 Parental Controls

Re: Analysts Weigh in on Madden's Mega Licensing Fees

Madden is the Tony Hawk Pro Skater of football games. People want NFL, there is only one choice. That doesn't mean it was good by any means. I played THPS because I enjoy skateboarding.. not because I like Tony Hawk. Now that I have an option to choose a different game (skate), I certainly will.

Backbreaker looked to be a Madden killer if the NFL would allow the license. But the shitty players in the league demand too much for their likenesses. Horrible role models.

Re: Analysts Weigh in on Madden's Mega Licensing Fees

True, but that's because NFL is an actual license. If people want American football, you can go somewhere else for that. Are you the same person who complains about the fact that Activision is the only company that can make spider-man games?

Re: Analysts Weigh in on Madden's Mega Licensing Fees

"Backbreaker looked to be a Madden killer if the NFL would allow the license. But the shitty players in the league demand too much for their likenesses. Horrible role models."

 

Yes....how dare they ask to be fairly compensated for using their likenesses....

 

It wasn't the players.  The League gave EA sole video game rights.  That means no NFL video games that isn't Madden.  You wanna blame anybody, blame EA for asking for such protection.

 

 

"You know what I wish? I wish all the scum of the Earth had one throat and I had my hands about it."

"You know what I wish? I wish all the scum of the Earth had one throat and I had my hands about it."
 
Forgot your password?
Username :
Password :

Poll

Will the FCC preempt state laws that limit municipal broadband services?:

Shout box

You're not permitted to post shouts.
PHX CorpI'm going to do a test stream later today, if anyone is intrested07/31/2014 - 2:40pm
Andrew EisenYes, I'm such a big Nintendo dork that I read Nintendo's quarterly financial reports.07/31/2014 - 2:09pm
Andrew EisenCool tidbit - Mario Kart 8 sales account for more than half of total Wii U software sales for the last quarter even though it was only available for the last third.07/31/2014 - 2:09pm
Andrew EisenStill a pretty cool promotion. Unfortunately for me, I'm not interested in purchasing Mario Kart 8 and I already owned or didn't want any of the free games on offer.07/31/2014 - 1:43pm
Andrew EisenInteresting that EU had 10 games to choose from while North America only had four.07/31/2014 - 1:41pm
MaskedPixelanteIt certainly worked, I probably would never have bought Mario Kart 8 if it didn't come with a free copy of Wind Waker HD.07/31/2014 - 1:14pm
Andrew EisenI imagine will see similar promotions like "Buy Mario Kart 8 get a download code for one of these specific games" but almost certainly not for all of its (however you would define) biggest releases.07/31/2014 - 11:24am
MaskedPixelanteI wonder if Nintendo is going to be doing "buy one get one free" promos for all their biggest releases going forward.07/31/2014 - 10:48am
MaskedPixelantehttp://www.mcvuk.com/news/read/special-report-retail-revolt-over-pc-code-strippers/013614007/31/2014 - 8:27am
ZippyDSMleeWouldn't they be able to afford and get done in a timely manner a general gba emluator for the 3DS? It seems to me if they want to make money off sales they need to do it.07/31/2014 - 7:25am
Sora-ChanAmbassador program, that's what I was looking for. Anyway the other games that have been made no longer exclusive to the early adopters got updates in their software. It'll only be a matter of time more than likely for the GBA to get the same treatment.07/31/2014 - 5:35am
Sora-ChanI might be naming it incorrectly when I say "founder" i mean the program for earlier adopters.07/31/2014 - 5:34am
Sora-Chanthe 3DS's GBA emulator was a rush job due to the founder program. No other GBA titles have been released on the 3DS yet. If/When they do get around to it, they'll more than likely update the emulation software.07/31/2014 - 5:32am
Zenemulator...it's not just a slap job that makes "some" work..they do it for each which is why they work so well. I would rather have the quality over just a slap job.07/30/2014 - 5:48pm
ZenMatthew there is a difference between "worked" and "accurate". You play the Nintendo VC titles they play as damn close to the original as possible. The PSP would just run them as best they could, issues and all. And Masked...EACH VC title has their own07/30/2014 - 5:48pm
MaskedPixelanteOnce again, the 3DS already HAS a GBA emulator, it just can't run at the same time as the 3DS OS.07/30/2014 - 4:54pm
Matthew Wilsonyou cant street pass in ds mode ether, and if moders can make a gba emulator that runs very well on the psp as I understand it. you are telling me that Nintendo devs are not as good as moders?07/30/2014 - 4:49pm
Zenperformance. Halo 1 and 2 worked great because they actually did custom work on each of them...just like Nintendo does now lol07/30/2014 - 4:08pm
Zenexisting hardware while the GBA has to be emulated completely. Same reason the 360 couldn't run most Original Xbox games correctly, or had issues because they just did "blanket approach" for their emulation which led to game killing bugs or horrible07/30/2014 - 4:07pm
ZenSora/Matthew: It's not just Miiverse, but the whole idea of streetpass and things like that would be affected if the OS is not running. And just because a 3DS game can be downloaded and run does not mean that GBA can as easily. Those 3DS games use the07/30/2014 - 4:06pm
 

Be Heard - Contact Your Politician