Electronic Arts launched its first soccer game without the FIFA tag on Friday, betting that its “FC 24” title will maintain momentum in its best-selling franchise and provide a bulwark against an industry downturn.
A The nearly three-decade partnership between EA and FIFA ended last year Media reports said it had demanded that the videogame maker double its annual payment of $150 million to world football’s governing body.
This deprives “FC 24” of the visibility and marketability of the FIFA brand. The game’s success is important to EA as some analysts estimate that the franchise accounts for a large portion of the company’s sales and its $32 billion market value.
“The end of such a high-profile partnership … creates an uncertain future for the publisher,” Joost Van Drunen, a lecturer at NYU’s Stern School of Business, said in his newsletter.
“Both gamers, who fear dilution of the franchise, and investors, concerned about how this will impact EA’s ability to generate revenue, are watching closely.”
EA has tried to boost the appeal of “FC 24” with new features like cross-platform play and HyperMotion V technology that uses data from actual footage to program in-game movements.
The standard edition of the game sells for $69.99 in the United States, while the Ultimate Edition sells for $99.99.
Analysts also believe that the FIFA split should open up a larger marketing budget for “FC 24”, which has retained the licenses of most football leagues, teams and players.
Wedbush Securities analyst Michael Pachter said, “EA spent less than 10% on marketing before they lost the FIFA name and they’re probably able to double that to 16%.”
“I’m sure sales won’t be affected…the company expects a small decline and they’re talking 5%.”
Pachter also pointed to the strength of the franchise’s Ultimate Team game mode, which generates over a billion dollars in sales annually by allowing gamers to purchase card packs to create their own virtual teams.
This has helped EA at a time when its other games, including Apex Legends, are suffering from a slowdown after the pandemic. company Net bookings missed expectations in the last quarter And laid off 6% of its workforce in March.
