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EA Is Giving Up Two Exclusive Sports Deals, But Hanging On To The Most Valuable...

by on23 July 2012 2463 times
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There could be good news for gamers as EA (formerly known as Electronic Arts) has agreed to a settlement in the Anti-Trust case over their exclusive deal with the NFL, NCAA, and AFL. Although all of the details are not known what we do know is that EA is agreeing to end their exclusive deal with the AFL and allow their agreement with the NCAA to expire in 2014. On top of these EA will pay $27 Million in compensation to consumers that bought any of these titles and will not seek another exclusive deal for five years. What is missing here is any mention of their exclusive deal with the NFL. Why this critical piece of the puzzle is being left out we are not sure.

For those of you not familiar with the story; back in the early 2000’s EA and Take-Two Interactive were competing in the sports based games arena. Although Take-Two’s first offering (EPSN NFL Football) did not do well their second offering of NFL 2K5 at $20 was a very big hit. It prompted EA to lower their pricing on Madden 2005 from $50 to $30. Right after this EA signed exclusive deals with the NFL, NCAA and AFL. This locked Take-Two and pretty much everyone else out of the market and allowed EA to push their price back up to $50 for their games.

So again, why is there no mention of the NFL deal in the settlement? EA knows that is the money maker and wants to hang on to it for as long as they can at a premium price. They are not giving up much with the NCAA and AFL and $27 Million is also a very small slap on the wrist for a company the size of EA. This means that the settlement is nothing more than a feel good move on their part. In order to truly make an impact EA should have to give up all of their exclusive deals (which really should be illegal anyway).  It is these deals that harm the consumer and giving up only two of the three do nothing to curtail this type of behavior.

There is a small chance that the deal will get rejected after an administrative review. This is what we are hoping for and that it is returned as being insufficient to deal with the issue of price fixing and monopolistic behavior on the part of EA.

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Last modified on 23 July 2012
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