Gamers Sue EA For Football Monopoly

By Pete Haas 2008-06-12 16:56:22 discussion comments
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Many sports gamers complain about how each installment of Madden is only a marginal improvement over the previous one. Now two gamers are finally doing something about it - by filing a frivolous lawsuit against EA that's sure to be dismissed.

The class-action lawsuit, filed by two gamers in Washington, D.C. and California, alleges that EA engaged in "blatantly anticompetitive conduct" by entering into exclusive rights agreements with the NFL, as well as the Arena Football League and NCAA football. These agreements mean that EA is the only company allowed to release games featuring the likenesses and names of these leagues' football teams.

The plaintiffs allege that as a result of owning the exclusive rights, EA is now free to "raise the price of its interactive football software substantially for a significant period of time without consumers substituting another product." They then trot this out as an example of a monopolistic price hike: "Prior to signing the exclusive agreements referred to above, Electronic Arts charged $29.95 for its flagship product Madden NFL. Immediately after the exclusive agreements entered into effect - and the effective withdrawal of its only competitor from the market - Electronic Arts increased its price for that software nearly seventy percent to $49.99."

What they're referring to there was the brief price war between 2K Sports' NFL 2K5 and Madden 2005. NFL 2K5 was released about a month earlier than Madden and was priced $19.95 from the get-go - an attempt to make inroads into a market mostly dominated by Madden. In response to strong sales and good reviews of NFL 2K5, EA reduced the price of Madden to $29.95 (from the original price of $49.99). In other words, their "seventy percent" price hike after the exclusive rights agreement with the NFL went into effect was just EA bringing the game back to its original price - which was the standard price for new sixth-generation console games, by the way. In addition, I highly doubt the NFL 2K series would've stayed at $19.99 for successive installments once they established their own player base. They also mention later in their lawsuit that Madden games now cost $59.99, but again, that's the standard market price for a new video game now. Say what you will about the quality of EA's exclusive sports franchises but they're not price hikers. On a side note, I doubt 2K Sports would want this lawsuit to be successful, anyway, seeing as they've got their own "monopoly" - the exclusive rights to Major League Baseball video games.

It's not as though no one else is allowed to make a football video game because of these exclusive agreements. Those games just can't use real teams or players. In recent years, Midway released Blitz: The League. which has fictional football players and teams, and 2K Sports released All-Pro Football 2K8, which has retired NFL players. You could argue that the sales for each game would've been stronger had they been able to use real NFL teams and players, but I think they can overcome this problem. It sucks for companies trying to crack into the football market, but I like to think it will ultimately result in very creative football video games that rely solely on great gameplay and don't need official licenses. If you doubt this is possible, look at any other genre; Perfect Dark and No One Lives Forever didn't use the 007 license but they were still pretty damn good spy shooters. I'm not going to blame Ea for making it impossible for other companies to coast on the name recognition of the NFL and other players like they can.

You could also argue that Madden had other NFL games to compete with, EA would've been pushed to create a higher quality product. I just don't see how you can quantify that, though. Every Madden game is at least somewhat of an improvement from the previous installment. Can you really sue because it's not as much of an improvement as you believe it should be? Especially if you're already arguing that a big appeal of Madden is that it has real-life players; at a bare minimum, every new Madden game has updated rosters.

The plaintiffs are seeking "restitution and damages for those who purchased an Electronic Arts football game since August of 2005, disgorgement of all profits made as a result of anticompetitive actions, and that the infringing agreements be declared null and void." I just don't see any this happening. I too have the vague, simplistic notion that having more than one NFL game on the market would somehow cause them all to be better (even though each would just end up decent in their own little way) and I'd like to see that happen but the key word is "like." I just don't think EA is breaking any laws here.
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